As gas prices surge regionally in 2022, study concludes that heat pumps outperform gas appliances on costs, efficiencies

New study: All-electric homes cheaper to build and operate in the Southwest than those that use gas

May 18, 2022

Peter Jensen, Sunstone Strategies |
Josh Valentine, Southwest Energy Efficiency Project (SWEEP) |


[BOULDER, CO] – Southwest homes in warmer climate cities such as Phoenix or Las Vegas that are built with highly efficient electric heat pumps will reduce their annual heating cost by 30%, compared with gas while reducing climate emissions by 60%, according to a study released today by the Southwest Energy Efficiency Project (SWEEP).

“For new homes across the Southwest, building with heat pumps rather than gas appliances is by far the best economic choice,” said Elise Jones, Executive Director of SWEEP. “Heat pumps lock in more affordable utility bills while eliminating a major source of climate and air pollution. It’s a win-win.”

The study analyzed heat pumps’ performance and costs in a mix of hotter and colder climate cities across the Southwest, including Phoenix, Tucson, Reno, Las Vegas, Albuquerque, Las Cruces, and Salt Lake City. In Las Vegas specifically, the study found that annual heating costs for a new all-electric home will be $230 annually, compared with $340 for gas heating. The home’s greenhouse gas (GHG) emissions are reduced by 62%. In colder climate cities, such as Reno and Salt Lake City, the study found that new homes with heat pumps see heating bills that are similar to homes that burn gas, but the GHG emissions are roughly 50% lower. Retrofits of existing homes result in emission reductions of 44-58%.

The findings come as gas heating bills are soaring across the country, prompting many households to seek alternatives to the gas furnaces. In January, gas prices in Nevada hit a 12-year high, and prices are forecasted to remain high throughout 2022 and even into 2023. For households seeking relief from painfully high gas bills, the study finds that it is economically feasible and can deliver energy cost savings to upgrade to a heat pump when the central air conditioning system needs to be replaced.

This year, however, utility companies such as Southwest Gas and Nevada Energy are attempting to double and triple down on plans to build out expensive fossil gas infrastructure, delivery systems, and residential tie-ins and hookups that will lock in more climate-heating emissions, more indoor and outdoor air pollution, as well as force new homeowners to pay for retrofits to convert to all-electric. Their plans will deepen the reliance states like Nevada have on imports of out-of-state fossil gas, rather than homegrown renewable energy solutions such as solar power.

”With today’s gas prices and current utility rebates, many Southwest homeowners will choose a heat pump the next time their air conditioner needs to be replaced, lowering their home’s climate impacts significantly,” said Neil Kolwey, Building Electrification Specialist for SWEEP.

More key findings of the report include:

  • For new homes, all-electric construction makes sense whether the home is in a warmer- or colder-climate city in the Southwest.
    • A cold-climate heat pump will efficiently keep the home comfortable without a backup furnace, and for warmer climate cities, an efficient less expensive heat pump will do the same.
  • For existing homes heated with gas, it’s feasible and can result in savings on energy bills to replace central air-conditioning (AC) systems with a heat pump when the AC needs to be replaced, partially or fully displacing the home’s gas heating in the process.

New studies demonstrate that gas appliances like stoves contribute to health risks from poor indoor air quality. Research from Stanford University found that gas stoves have much higher methane leakage rates than previously thought, making gas cooking a significant contributor to global warming. In addition, gas stoves emit nitrogen oxides, carbon monoxide, and formaldehyde, directly exposing people to risks of asthma and other respiratory issues.

The study is available here, and includes a full list of recommendations for policymakers and utilities in the Southwest.


The Southwest Energy Efficiency Project (SWEEP) is a public interest organization promoting greater energy efficiency and clean transportation in Arizona, Colorado, Nevada, New Mexico, Utah, and Wyoming.