Comparing the Cost of an 80% vs. 96% Efficient Furnace in Denver
If your furnace is aging, you might be wondering whether it’s worth upgrading to a higher-efficiency unit. Here’s a look at what that really costs — and saves — in a typical Denver winter.
Furnace Efficiency Basics
Furnaces are rated using AFUE (Annual Fuel Utilization Efficiency):
- 80% AFUE: 80% of the fuel burned becomes heat for your home, 20% lost up the flue
- 96% AFUE: 96% of fuel becomes heat, only 4% lost
That difference may seem small, but over an entire Denver winter, it can add up.
Denver Winter Heating Scenario
Assumptions based on Denver climate:
- 1,500 sq ft single-story home with basement
- Heating load ≈ 60–65 MMBTU per season (rough estimate based on 5,800 heating degree days)
- Natural gas cost ≈ $1.30 per therm (100,000 BTUs per therm)
Seasonal Gas Usage
80% AFUE furnace:
- 65 MMBTU ÷ 0.80 ≈ 81.25 MMBTU of gas burned
- Convert to therms: 81.25 ÷ 0.1 ≈ 812.5 therms
- Seasonal cost: 812.5 × $1.30 ≈ $1,056
96% AFUE furnace:
- 65 MMBTU ÷ 0.96 ≈ 67.7 MMBTU of gas burned
- Convert to therms: 67.7 ÷ 0.1 ≈ 677 therms
- Seasonal cost: 677 × $1.30 ≈ $880
Seasonal Savings: $1,056 – $880 ≈ $176 per winter
Replacement Cost
- 80% AFUE furnace: $5,500 installed
- 96% AFUE furnace: $7,500 installed
Difference in upfront cost: $2,000
Estimated Payback Time
Payback = Extra cost ÷ Annual savings
$2,000 ÷ $176 ≈ 11.4 years
So purely on gas savings in Denver’s winter, it takes a bit more than 11 years to recoup the higher installation cost.
Things to Keep in Mind
- Comfort and features: 96% furnaces often have variable-speed blowers and better temperature control.
- Reliability and warranty: Newer, high-efficiency models may have longer or more comprehensive warranties.
- Incentives: Some Xcel rebates or financing can reduce the effective cost greatly as well.
Bottom Line
Upgrading from 80% to 96% efficiency does save money on natural gas, but the payback in Denver winters is slow if gas savings is your only goal. For many homeowners, the decision comes down to comfort, long-term reliability, and available incentives — not just the energy savings.
Premier Mechanical – www.claimyourcomfort.com – 720.207.6812