For homes not connected to a natural gas utility, propane is the main alternative for gas-fired appliances. The cost comparison between propane and natural gas is straightforward — but propane's advantage is availability in rural and off-grid areas.
Energy Content and Cost Comparison
Natural gas: ~100,000 BTU/therm, national average $1.30/therm → $13 per million BTU. Propane: ~91,500 BTU/gallon, national average $2.50–3.50/gallon → $27–38 per million BTU. Natural gas is 2–3x cheaper per BTU than propane in most markets. However, natural gas requires utility infrastructure — if you're not in a service area, it's not an option.
Heating Cost Comparison
Annual heating cost for a 2,000 sq ft home in a moderate climate: Natural gas furnace (95% AFUE): $800–1,200/year. Propane furnace (95% AFUE): $1,800–2,800/year. The difference — $1,000–1,600/year — represents real ongoing cost for rural homeowners who must use propane. At this savings rate, the cost of connecting to a gas main (often $2,000–8,000 for a nearby street connection) pays back in 2–6 years where available.
Propane's Advantages
- Available anywhere — no utility infrastructure required
- Higher BTU per cubic foot than natural gas — more energy dense in liquid form
- Slightly lower carbon emissions per BTU than natural gas (though still a fossil fuel)
- Can be stored on-site, providing energy security independent of utility outages
When to Switch from Propane
If natural gas service is available on your street: connecting almost always pays back within 3–5 years given the cost difference. If not: a heat pump can cost less to operate than propane in most climates, even accounting for electricity costs. Use our Heating Cost by Fuel Calculator to compare your specific rates.