Readers typically pay for natural gas based on price per therm and the efficiency of their gas-powered equipment. The main cost drivers are energy content, regional gas prices, delivery charges, and the efficiency of furnaces or boilers converting gas to heat. This article breaks down the cost per kWh and related pricing considerations to help homeowners estimate monthly bills and compare options.
| Item | Low | Average | High | Notes |
|---|---|---|---|---|
| Natural gas price per therm | $0.60 | $1.10 | $1.90 | Regional price swings. |
| Gas-to-kWh conversion (BTU to kWh) | Not applicable | 3.0 | 3.9 | BTU per kWh factor ≈ 3412 BTU/kWh. |
| Delivery charges (monthly) | $2 | $10 | $25 | Utility-imposed fees. |
| Efficiency of equipment (AFUE) | 60% | 78% | 98% | Higher efficiency lowers cost per kWh. |
| Annual usage (therms) | 400 | 900 | 1800 | Household heat demand. |
Overview Of Costs
Costs span price, usage, and efficiency. The typical price range for natural gas in the U.S. is measured in dollars per therm, which then translates to a cost per kWh after accounting for system efficiency. Assumptions: region, home size, climate, and heating equipment. The total bill depends on how many therms are used and how efficiently gas is converted into heat.
Assumptions: region, specs, labor hours. For a standard 2,000-square-foot home in a moderate climate, average annual gas consumption runs in the 800–1,000 therms range, with monthly bills fluctuating with seasonality and rate structures. The conversion to kWh helps compare gas to electric options or to review efficiency gains.
Cost Breakdown
Breakdown shows where money goes: fuel, delivery, and system efficiency. The following table presents a mix of totals and per-unit pricing to illustrate typical pricing components for a heating season.
| Component | Low | Average | High | Format | Notes |
|---|---|---|---|---|---|
| Materials | $0 | $0 | $0 | Total | Gas itself is the primary material cost. |
| Labor | $0 | $0 | $0 | $/hour | Not always applicable for ongoing fuel use; included for maintenance work. |
| Equipment (AFUE impact) | $100 | $600 | $2,000 | Est. | Higher-efficiency furnaces reduce ongoing kWh cost. |
| Delivery/Transmission | $2 | $10 | $25 | $/month | Variable by utility and region. |
| Permits & Codes | $0 | $0 | $100 | $/project | Typical only for new installations or major replacements. |
| Taxes | $0 | $0 | $50 | $/season | State and local taxes where applicable. |
What Drives Price
Region and efficiency are the top price drivers. The price per therm can vary by region due to supply contracts, seasonal demand, and pipeline costs. The efficiency of a gas furnace or boiler (AFUE) directly affects how many therms you need to produce a given amount of heat, which alters the cost per kWh. Additionally, how a home is insulated and how heat is distributed impacts total consumption.
Two numeric thresholds frequently matter: furnace AFUE ratings (e.g., 78% vs 95%) and annual consumption (therms). If you replace an old 70–80% AFUE unit with a 90%+ AFUE unit, you can expect a meaningful reduction in gas per delivered kWh, especially during peak winter usage.
Regional Price Differences
Prices differ across urban, suburban, and rural areas. In the Northeast, higher winter demand can raise a therm price relative to the South. The West generally benefits from more moderate winter heating needs but can see higher delivery charges in remote areas. Rural households often encounter higher per-therm delivery costs than urban settings due to longer distribution lines. A typical three-region comparison shows +/- 10–25% deltas in price per therm, with a corresponding impact on cost per kWh when converted for heat requirements.
Assumptions: climate, utility structure, and access to pipeline networks affect regional pricing. The following scenario illustrates typical differences in costs by market type.
Real-World Pricing Examples
Concrete scenarios help translate pricing into expected bills. The examples assume a moderate climate, an average-efficiency furnace, and typical household usage. Each card provides materials, labor where relevant, and a total with a per-kWh equivalent.
Basic
Specs: small single-family, older 70% AFUE boiler, 800 therms/year, standard delivery. Labor: none for annual usage.
Totals: $850 per season; roughly 2.6 kWh per therm-equivalent (approx 2,260 kWh total energy content). Assumptions: region, specs, labor hours.
Mid-Range
Specs: 2,000 sq ft, mid-efficiency 82% AFUE, 1,000 therms/year, average delivery charges.
Totals: $1,400–$1,900 per season; per-kWh equivalence about 3.0–3.2 kWh per therm, depending on BTU conversions. Assumptions: region, specs, labor hours.
Premium
Specs: newer 95%+ AFUE boiler, 1,400 therms/year, optimized distribution and smart controls.
Totals: $2,100–$2,900 per season; per-kWh efficiency improved by equipment, lowering the effective kWh cost by 10–20% relative to baseline. Assumptions: region, specs, labor hours.
Factors That Affect Price
Seasonality and usage patterns matter. Winter peaks typically raise per-therm price through demand and delivery costs, while summer months may show lower consumption but still include fixed charges. A home’s insulation quality, duct integrity, and thermostat settings influence actual gas usage, affecting the cost per kWh on a monthly bill.
Other drivers include: thermostat technology (programmable vs. smart), heating system age, and maintenance frequency. A well-tuned system reduces wasted gas and improves the effective cost per kWh, especially during the coldest weeks.
Ways To Save
Efficiency upgrades and rate comparisons often yield meaningful savings. Start with an efficiency upgrade, such as a higher AFUE furnace or boiler, and consider sealing ducts to reduce losses. Compare supplier pricing and fixed charges across utility plans, and review off-peak rates if available. Seasonal maintenance helps keep burners clean and combustion efficient, lowering fuel usage per cooling or heating cycle.
Additionally, consider smart thermostats and zoning to avoid heating unoccupied areas. When evaluating a replacement, include installation costs and potential rebates to determine true price per delivered kWh over the system’s life.
Maintenance & Ownership Costs
Long-term ownership adds predictable costs. Annual maintenance typically runs $150–$300 per year for a gas furnace, depending on service level and parts coverage. A new unit may carry a 5–10 year warranty on parts and a separate labor warranty, reducing long-term outlays. Factor in filter replacements, vent cleaning, and occasional duct work when estimating lifetime costs.
Over a 5-year horizon, a mid-range system with average consumption and standard maintenance may show a total cost variance of 5–15% based on efficiency gains and energy price changes. Assumptions: region, specs, labor hours.