If you’re shopping for a new home furnace, you’ve likely run across the abbreviation “AFUE.” It stands for Annual Fuel Utilization Efficiency — a long title that serves an important purpose.
That’s because your furnace’s fuel efficiency makes a direct, long-ranging impact on your heating bill. If you’re looking for a new furnace to buy or wondering if it’s time to upgrade your old one, this rating should be a key factor in making the decision.
At Wyckoff Heating & Cooling, we help customers choose the right heating systems for their homes every day. Here’s a quick guide to furnace efficiency ratings and how to choose the right one for you.
What Is an AFUE Rating? Understanding Furnace Efficiency.
About 60% of Iowa homes use natural gas furnaces. When a furnace runs, it burns the gas to produce heat, which it then uses to heat the air in the home. However, some of the original energy from the natural gas is lost during the process. Annual Fuel Utilization Efficiency (AFUE) measures how much of the energy used to power a furnace or a boiler actually converts into heat.
The rating is calculated by taking a furnace’s (or a boiler’s) total annual heat output divided by its total annual energy input. For example, an AFUE rating of 80% means that 80% of the fuel that your furnace consumes is actually converted into energy, and 20% goes to waste. Essentially, 80 cents of every dollar you spend on energy is actually converted to heat.
A higher AFUE rating (such as 90%) means that less fuel (only 10%) went to waste when the furnace ran.
While gas furnaces are the most common, electric furnaces and propane furnaces also have AFUE ratings. Electric furnace ratings are typically very high, often between 95 and 100%, because they do not need to vent exhaust gases.
It’s important to note that the AFUE rating does not take the rest of your home’s heating system into account, such as any heat that’s lost in your ducts. This additional heat loss can be significant, and it’s one of the reasons it’s important to have your home heating system regularly inspected. However, choosing a furnace with a high AFUE rating is a key step to making your home energy efficient.
What’s a Good AFUE Rating for Colder Climates Like Iowa?
When you purchase a furnace, you’ll see each model has an AFUE rating that’s been assigned during testing. Higher efficiency furnaces are often more expensive up front. However, they can lower your energy costs over time.
For example, if you have a 96% AFUE rating on your furnace vs. an 80% AFUE rating, you can expect to save 16 cents for every dollar you spend on gas to heat your home.
AFUE ratings can be categorized into these efficiency tiers:
- Low-efficiency systems are typically below 80%.
- MId-efficiency systems are between 80% and 90%.
- High-efficiency systems are above 90%.
For colder climates, like Iowa, a high-performing furnace should have an AFUE rating of 95% or more. That’s the percentage needed to achieve an ENERGY STAR® certification in Iowa and the rest of the northern United States. Some gas furnaces run even higher, in the 97-98% range, with very low margins of energy waste.
Since 1992, the federal government has also set a minimum baseline for fuel efficiency in gas furnaces nationwide:
- In 1992, the minimum AFUE level was 78%.
- The minimum increased to 2015 in 80%.
- The minimum is expected to increase to 95% in 2028 due to new federal rules.
If your furnace was installed after 1992, you should have an AFUE rating of at least 78%. If it is older than that, it could be significantly lower.
How Does a High Efficiency Furnace Work?
High efficiency furnaces are built differently from low- and mid-efficiency furnaces. They include a few specific elements:
- A sealed combustion chamber. Your combustion chamber is where the natural gas, oil, or propane is burned to create heat. A lower efficiency furnace will pull air into this chamber from within your home, which means that it’s using already heated air to heat more air. The combustion chamber in a high-efficiency furnace is sealed off from the inside and draws in cold air from the outside, making it more efficient and safer.
- A second heat exchanger. Your furnace’s heat exchanger transfers heat from the combustion chamber to the rest of your heating system. By adding a second exchanger to the process, a high-efficiency furnace (90% or more) is able to capture more heat from exhaust gas before it’s released, reducing the overall energy waste.
Should I Buy an 80% or 95% Efficiency Furnace?
Home furnaces account for more than 40% of the average American’s annual energy bill. To keep your costs down, your AFUE rating should be a key consideration when you’re choosing a new furnace. This is especially essential in Iowa, where harsh winters mean furnaces often run every day for several months at a time.
One of the questions you may wonder, though, is, “How much efficiency is enough?” Since higher-efficiency systems cost more, you may wonder when – or if – you’ll break even.
In Iowa, purchasing a high efficiency furnace often is worth the added cost due to the long-term benefits. However, purchasing the highest efficiency furnace every time isn’t always worth the added cost. It may be helpful to run a cost-benefit analysis to figure out how much the added cost would be outweighed by any decrease in your energy bill. For example, if you spend $800 on gas per year, choosing a 99% efficiency furnace over a 96% would only save about $24 each year — with a much higher price tag on the overall unit.
ENERGY STAR certified products are designed to be more cost-effective over their lifespan, but it’s also important to consider outside factors that could influence the cost, such as inefficiencies in the rest of your system. That’s where working with an HVAC professional can help. At Wyckoff Heating & Cooling, we will be able to help you determine the right mixture of price and efficiency for your specific home. We can also help you explore other options, such as radiant heating or geothermal systems.
Another important note: Even the most energy efficient furnace will not save you money if it is not properly installed. That’s why working with our certified furnace installers is essential to getting the most out of your home’s heating system.
Work With Iowa’s Furnace Installation & Repair Experts
If you need to purchase a new furnace, Wyckoff Heating & Cooling can be your decision-making partner. We’ll help you understand your home’s heating and cooling system from a holistic perspective so you can navigate AFUE ratings and other factors to select the best system for you. Want to learn more? Contact us today.
Aside from investing in a new furnace, there are many ways you can improve the efficiency of your existing furnace unit. If you’re looking for some tips, check out our guide to saving money on your home heating bill.