How much does it cost to heat and cool a 2,000 sq ft home in California?

In California (34.7¢/kWh via PG&E / SCE / SDG&E (CPUC)), a 2,000 sq ft home averages $791/year ($66/month) with a high-efficiency heat pump, $667/year with a natural gas furnace and central AC, and $2,176/year with electric baseboards.

Are heat pumps cheaper to run than gas furnaces in California?

At California's natural gas rate of $2.15/therm, the economic break-even electricity price for a COP 3.1 heat pump is 24.7¢/kWh. Comparing this against California's residential electricity rate of 34.7¢/kWh determines annual operating savings.

California Heating & Cooling Cost Calculator (2026)

2,000 Sq Ft Heat Pump Bill

$66/mo

CA Electricity / Gas Rate

34.7¢ / $2.15

15-Yr Savings vs Baseboard

+$17,175

California Annual Heating & Cooling Bills by Home Size

In California, a 2,000 sq ft home averages $791/year ($66/mo) using a cold-climate heat pump ($579/yr winter heating + $212/yr summer cooling), compared to $667/year with a natural gas furnace and $2,176/year with electric baseboards.

Home Size	Heat Pump (COP 3.1)	Gas Furnace + AC	Baseboard + Window AC	15-Yr Heat Pump Savings
1,000 Sq Ft	$396/yr ($33/mo)	$334/yr ($28/mo)	$1,088/yr ($91/mo)	+$6,780
1,500 Sq Ft	$593/yr ($49/mo)	$500/yr ($42/mo)	$1,632/yr ($136/mo)	+$11,985
2,000 Sq Ft	$791/yr ($66/mo)	$667/yr ($56/mo)	$2,176/yr ($181/mo)	+$17,175
2,500 Sq Ft	$989/yr ($82/mo)	$834/yr ($70/mo)	$2,720/yr ($227/mo)	+$22,365
3,000 Sq Ft	$1,187/yr ($99/mo)	$1,001/yr ($83/mo)	$3,265/yr ($272/mo)	+$27,570
3,500 Sq Ft	$1,385/yr ($115/mo)	$1,168/yr ($97/mo)	$3,809/yr ($317/mo)	+$32,760

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Verify 2026 Federal 25C Tax Credit & PG&E / SCE / SDG&E (CPUC) rebate eligibility and compare turnkey contractor pricing for a 3.0-Ton system (2,000 sq ft).

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