Cheapest Ways to Heat a House With Electricity

Setting your home to the right temperature—and keeping it there—can take a lot of energy.

In fact, the typical U.S. household spends about 55% of their annual electricity usage on heating and cooling alone. That’s more than all your other electrical appliances combined.

We get it. You want to feel comfortable in your home, and there are few things better than a warm and cozy home on a winter day. But all that electricity can come with a serious price tag. The good news is that, when it comes to heating your home with electricity, there are also tons of opportunities for saving money and lowering your carbon footprint.

Here’s your guide to the cheapest ways to heat a home with electricity.

The benefits of heating a home with electricity

The two most common energy sources used to heat homes are natural gas and electricity. Historically, natural gas has been the more popular choice with roughly 47% of households using gas to heat their homes in comparison to 36% that rely on electricity. Other common heating sources include oil, kerosene, and wood.

The main reason natural gas is more common than electricity is that it’s cheaper. But that’s pretty much its only advantage. And as the world moves towards decarbonization and electrification, heating your home with electricity is becoming an increasingly appealing option.

Here are the top benefits of heating your home with electricity.

1. Electricity is cleaner than natural gas

Natural gas is a fossil fuel, which means when you use it to heat your home, you’re releasing carbon dioxide into the atmosphere. In fact, the carbon footprint of using gas to heat buildings is so significant, the International Energy Agency (EIA) has recommended that countries ban the selling of new gas and oil boilers by 2025 to help meet the world’s climate goals.

On the other hand, electricity generally is much cleaner than gas. Clean energy sources like nuclear and renewable sources like solar, wind, and hydro are quickly taking over as the predominant sources of electricity. The spread of renewables is not only helping to reduce carbon emissions but is also helping drive down prices.

2. Electricity poses fewer health risks than natural gas

Although it’s uncommon, boilers and furnaces that use natural gas can sometimes leak carbon monoxide and pose other dangerous health hazards. Electric boilers on the other hand don’t release any carbon monoxide. Additionally, homes with electric boilers and furnaces are reported to have better overall air quality than homes that use gas boilers.

3. Electric boilers and heaters require less maintenance and are easier to install

Most gas boilers require annual maintenance to ensure that they’re safe and efficient to run. Additionally, gas furnaces are much more difficult to install and can take up a lot of space in your home.

Electric boilers, heat pumps, and space heaters tend to be more maintenance-free—though it’s always important to monitor any heat generating device while in use. In addition, electric furnaces have been found to have longer lifetimes, sometimes up to 30 years.

What are the cheapest ways to heat a home with electricity?

It depends on your heating needs.

How big is your home? Do you spend your time mostly in one room? How cold does it get in your climate? What are the electricity rates? Are you installing a new heating system or trying to reduce costs with an already-installed system?

Below, we’ll break down some of the best options for heating your home with electricity and talk about the pros and cons of each.

Electric furnaces

The most powerful, but also most expensive

Electric furnaces are the most common system for heating homes with electricity. They work by blowing hot air to different rooms in your home via ducts—kind of like a massive hair dryer. Electric furnaces are typically more expensive than most other heating devices, partially because they’re so powerful. While it is possible to install an electric furnace on your own, most experts recommend letting professionals handle it.

Is an electric furnace right for you?

Electric furnaces are best for homeowners looking for a system that can effectively heat their entire home. While electric furnaces have a considerable upfront cost, you’ll see the payoff in effectiveness. You may also want to look into installing an electric furnace if you already have a gas furnace installed—especially if it’s an older gas furnace. Switching to electricity will not only significantly lower your home’s carbon footprint, but it will also help to improve the air quality of your home. Not to mention, electric furnaces require far less maintenance than gas furnaces.

Pros of an electric furnace:

• The most effective device for heating an entire house
• Can heat a whole house in any climate
• Easy to use—just adjust your thermostat
• Don’t require much maintenance and can last up to 30 years
• More environmentally friendly than gas furnaces (and better for your health)

Cons of an electric furnace:

• Require a lot of electricity to run
• Take up lots of space
• Difficult and expensive to install

Heat pumps

The most efficient

Heat pumps are extremely efficient heating and cooling devices that function by transferring heat in and out of a room rather than creating it. There are two main types of heat pumps: geothermal and air-source. The difference between the two has to do with where they draw their heat from. Air-source heat pumps transfer heat from, you guessed it, the air. Geothermal heat pumps draw their heat from the ground. Generally, geothermal heat pumps are much more expensive, but they also require less maintenance and are typically more efficient in colder climates.

Is a heat pump right for you?

We highly recommend heat pumps, especially if lowering your carbon footprint is one of your main goals. While they can be expensive to install, you’ll likely see savings benefits in the long run due to how efficient they are to run once installed. The one reason you might want to consider an alternative heating system is if you live in an extremely cold climate. Heat pumps work by transferring heat rather than creating it, so if you live in a cold climate where there is not much heat in the air or ground outside, then your heat pump won’t be as efficient.

Pros of a heat pump:

• Most energy-efficient way to heat a home using electricity
• Heat pumps can reduce your heating costs by up to 50%
• Effective for both heating and cooling your home

Cons of a heat pump:

• Might not be suitable for extremely cold climates
• Not good for room-specific heating
• Requires regular maintenance to replace filters and keep clean

Space heaters

Best for room-specific heating

Space heaters are designed for heating individual rooms or areas of your home. As portable heating devices, they’re great alternatives to electric furnaces and heat pumps because you can target your heating efforts to specific rooms.

Although space heaters are not as energy efficient as heat pumps or electric furnaces, you can end up saving lots of money by using them strategically to heat individual rooms while you’re using them. Space heaters can be great additions to central heating systems if you’re only going to be hanging out in a single room for most of your day. Instead of turning on your furnace and heating your whole home or a few rooms at a time, you can target your heating efforts to just the space you’re in.

Is a space heater right for you?

Space heaters can help you save money by targeting their heating efforts to specific rooms. Space heaters are great for anyone looking to reduce how often they have to turn on their central heating system, especially if you’re only spending most of your time in certain rooms of your home. The other main advantage of space heaters is that they’re portable, so you can take it with you from room to room. Space heaters are a great supplement to heat pumps and electric furnaces.

Pros of a space heater:

• Cheapest way to heat individual rooms
• Don’t take up a lot of space and are portable
• Much cheaper than heat pumps or electric furnaces
• Can be a great addition to a central heating system

Cons of a space heater:

• Not very efficient for heating large spaces
• Can’t use them to heat a whole house
• Require a lot of electricity to run
• Need to monitor them while in use

When using a space heater, it's imperative that you follow the instructions, take proper precautions, and monitor the unit at all times. Learn more here about safely using a space heater.

Electric baseboard heaters

A more efficient space heater—but not portable

Electric baseboard heaters are essentially space heaters that you hardwire into a room’s electrical system. In other words, they’re not portable space heaters. The tradeoff is that they’re typically much more efficient than space heaters.

While baseboard heaters may not be as effective as heat pumps or electric furnaces, they are still solid solutions for heating individual rooms and can be a great supplement to a central heating system.

Another benefit is that it’s possible to install an electric baseboard heater on your own. They’re also much cheaper than larger heating systems. You can even connect them to a thermostat so you can program them to operate on schedules. If you spend most of your time in one room every day, you may want to consider installing an electric baseboard heater to keep that room nice and toasty.

Is an electric baseboard heater right for you?

Electric baseboard heaters are great for people who spend most of their time in one room throughout the day. If you don’t need the portability of a space heater, then you’ll want to consider an electric baseboard as they are far more efficient than space heaters. Like space heaters, electric baseboards can be a great supplement to other central heating systems.

Pros of an electric baseboard heater:

• Cheap and easy to install (DIY friendly)
• Great supplement to central heating systems
• Most efficient option for room-specific heating
• Safer to use than portable space heaters
• Silent to operate

Cons of an electric baseboard heater:

• Not portable (but possible to relocate)
• Can only heat the room in which they’re installed
• Less efficient than heat pumps and central furnaces
• More expensive than space heaters

Just like a portable space heater, make sure you take necessary safety precautions when using an electric baseboard heater.

Electric radiant floor heating

Heat from the feet up

Radiant floor heating works by heating up coils beneath the floorboards of a room in order to heat up the rest of the room. Radiant floor heating is typically very energy efficient because in comparison to other heaters, you don’t have to use as much heat to warm up a room as it is more evenly dispersed across the room.

Is radiant floor heating right for you?

Radiant floor heating is a great, energy efficient heating option, but the installation is rather complex and can be expensive (you'd likely want to hire a professional). We recommend radiant floor heating for homeowners who are already in the process of building or rebuilding parts of their home.

Pros of electric radiant floor heating:

• Very efficient—can cut heating costs by 25-50%
• More consistent heating than forced air systems (heat pumps and furnaces)
• Warm floors are simply delightful
• Doesn’t take up any space once installed

Cons of electric radiant floor heating:

• Difficult to install
• Considerable upfront costs
• May not be suitable for every home

Tips for lowering your heating costs

1. Improve your home’s insulation

Insulation is key to an efficient heating system. Houses with old insulation can end up losing tons of heat, resulting in their heating systems having to work overtime. The EPA and ENERGY STAR estimate that homeowners can save 15% on their heating and cooling costs with proper insulation in attics, windows, and basements.

Replacing and updating your home’s insulation can be a good weekend DIY project. Or you can have a professional come to your home and evaluate where you can improve insulation.

2. Bundle up

Who doesn’t love a good blanket or sweater? If you’re really looking to cut down on your heating costs, pick up a few extra blankets and put them in the rooms you hang out in. Blankets are sure to boost the coziness factor of your home tenfold.

3. Keep your doors closed

Make sure if you’re using a space heater or baseboard heater that you keep the room your heating closed off from the rest of the house.

4. Use a combination of heating devices

One of the best strategies for heating your home efficiently is to use a combination of heating devices. If you have a central heating system like an electric furnace or heat pump, take some time to determine when you want to be heating your whole home vs. specific rooms. If you spend most of your time in one room, you may want to invest in a space heater that you can use to target just that room.

5. Buy a smart thermostat

Smart thermostats help track your daily habits to optimize your heating and cooling schedule. Some smart thermostats can automatically detect when you’re home and can turn your heating on and off accordingly. You can also program your heating schedules right from your phone with a smart thermostat.

While it’s possible to set schedules with any thermostat, smart thermostats are designed to make it easy and automatic. When it comes to eco-hacking your home, let technology do the hard part for you, so you can have a warm and cozy home without thinking too hard about logistics.

6. Choose clean energy

One of the biggest factors that impacts your electricity costs is the electricity rate. And for years, most consumers didn’t have a choice over where they got their electricity from. But things have changed today, and as clean energy has become more prevalent, consumers have been given a new power—the ability to choose where they source their electricity.

There are tons of options out there today, like signing up for community solar, installing your own solar panels, or taking advantage of energy deregulation by shopping yourself for more affordable plans outside of your utility company.