SWEEP study: Benefits of heat pumps for Colorado homes

February 7, 2022 | Neil Kolwey

SWEEP study: Benefits of heat pumps for Colorado homes

In response to devastating wildfires in Colorado and other climate change-driven extreme weather around the county, more and more Coloradans are asking, “what can we do to reduce our carbon footprint?” A good place to start is switching to an efficient electric heat pump to heat and cool the home. This switch would have a similar impact to switching from a gasoline-powered car or truck to an electric vehicle. 

The Southwest Energy Efficiency Project (SWEEP) just released an updated study of the benefits of heat pumps and heat pump water heaters (HPWHs) for Colorado homes, about 85% of which currently use gas for heating. Gas prices have increased significantly in the last six months, and as a result heat pumps and HPWHs are now much more cost-effective than they were only one or two years ago. In addition, heat pump and HPWH performance and availability have continued to improve.  

For homes heated with gas, a practical option is to replace the central air-conditioner (AC) (for homes that have one) with a heat pump, when the AC needs to be replaced. Heat pumps provide cooling in the same ways as central AC systems, but also provide efficient electric heating in the colder months.

With the proper installation of an efficient heat pump — and keeping the existing furnace or replacing it if needed — it can displace up to 80% of annual gas use for home heating, while the furnace takes care of the home’s heating needs during the coldest outdoor temperatures.  

In this scenario, for an Xcel Energy electricity customer, the annual heating costs will be within about 10% (about $80 per year) of those for a home relying on an efficient gas furnace for all its heating needs. In addition, reasonable utility incentives will cover most or all the incremental costs of installing the heat pump in place of the air-conditioner.

The six largest electric utilities in Colorado, which provide over 90% of Colorado’s electricity, all have goals and plans to reduce their greenhouse gas (GHG) emissions from electricity generation by at least 80% by 2030. Because of these plans, switching to efficient electric heating reduces a Colorado home’s carbon impacts significantly. With the heat pump displacing 80% of the home’s gas use for space heating as just described, the home’s GHG emissions from heating will be reduced by about 50% over the next 15 years (the average life of a heat pump).  

For new homes, it makes sense to completely electrify the home, eliminating the need for gas service. A cold-climate heat pump will efficiently keep the home comfortable without a backup furnace. HPWHs are also very efficient, with annual energy costs slightly lower than those for gas water heaters (factoring in current gas and electricity prices). Induction stove cooktops and ranges also work great and help improve the indoor air quality and safety of the home compared to gas cooking.  

SWEEP estimates that by eliminating the cost of the gas piping to the new home, the total initial cost of an all-electric new home with these efficient electric appliances will be about the same or slightly less than the cost of a gas-heated home with gas appliances. In addition, the annual heating costs (including hot water) for an all-electric home will be about 10% less than for the gas home, and the all-electric home’s carbon emissions will be about 60% less. 

Efficient electric heat pumps and HPWHs have the potential to significantly reduce carbon and other pollutant emissions from Colorado homes, with a reasonable initial cost and without adversely affecting annual heating bills. Through our policy advocacy efforts and collaborative work with the Beneficial Electrification League of Colorado — a coalition of utility, government and nonprofit stakeholders supporting beneficial electrification — SWEEP’s goal is to steadily increase the efficient electrification of homes and commercial buildings, and to help Colorado achieve its climate goals.