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Is Gas Cheaper Than Electricity For Appliances?

Andrew Dehan6-Minute Read
UPDATED: August 08, 2022

When it comes to utility costs, electricity and gas are the two major contenders. But if you had to choose between them, which is the better option? As usual, the answer for this depends on your circumstances. This choice largely depends on your needs and what you’re looking for in your home.

Here we’ll cover the expenses of gas vs. electric, including operating costs and installation costs. We’ll compare gas and electric versions of three major appliances: your water heater, furnace and stoves/ovens. Then we’ll try to weigh both and tackle whether gas or electric is right for you.

Let’s get started.

Gas Vs. Electric: What’s The Cost?

Is gas cheaper than electricity? The answer is almost always yes when talking about operating costs. Gas appliances may have a higher upfront cost but will save homeowners money on the utility bill.

In general, operating costs for appliances using natural gas are cheaper than those fueled by electricity. According to Washington Gas, a 2,300-square-foot home in the Washington, DC, area could save around $350 a year by switching from electric to gas.

Where electricity is derived from a variety of sources (including natural gas), the heat from gas comes from burning natural gas. Natural gas is historically a cheap source of fuel. Using it to heat your home and your water can be more efficient than electricity.

Though operating costs associated with gas are cheaper than electricity, there are other costs to consider. For example, if your home isn’t set up for natural gas, you’ll need to pay a plumber install a gas line. You’ll also need to pay for new appliances.

So, is gas or electric cheaper? That depends on your home and the specific appliances. There are also some other costs to consider.

Other Cost Factors To Consider

Consider whether gas or electricity would be cheaper over the appliance lifespan. When talking furnaces, for example, an electric furnace can last 10 or more years than its gas counterpart.

Paying attention to appliance lifespan and replacement cost is important when weighing electric vs. gas. Consider also:

  • Location: Natural gas prices vary nationally. The U.S. Energy Information Administration (EIA) has a helpful map of which states are most expensive. For example, people in Maine or Florida pay over twice as much for natural gas than those in much of the midwestern U.S.
  • State regulations: 17 U.S. states have deregulated energy markets. This means you can choose how you buy your electricity and/or natural gas. Research what regulations are in your state. You may have the opportunity to shop around for the best price.

Gas Vs. Electric Appliances: How Do They Compare? 

Let’s compare three common major home appliances: the water heater, furnace and stoves/ovens. There’s electric and gas versions of each of these and they each come with their pros and cons.Keep in mind that, along with cost, energy efficiency varies from appliance-to-appliance. Look for an energy factor (EF) rating. The higher the rating, the more energy-efficient the unit is.Gas Vs. Electric Water HeaterElectric water heaters on average are cheaper to purchase and install than gas water heaters. When talking efficiency, tankless water heaters – either gas or electric – are the most efficient, but also more expensive upfront.The pros of electric water heaters are that they require less space, are durable and can have less of an environmental impact than gas water heaters. Their environmental impact depends on where the electricity is coming from. If it’s from a renewable source, like wind or high efficiency solar panels, they’re much more environmentally friendly, but a large portion of electricity comes from natural gas, so in that sense, they’re not efficient.Gas water heaters have their own upsides. They tend to heat water faster, have lower operating costs and aren’t tied to the electrical grid. If your electrical goes down and you have an electric water heater, your water’s cold. On other hand, if you have a gas water heater, it’s unaffected by the power outage.Gas Vs. Electric FurnaceChoosing a gas furnace or an electric furnace could be largely dependent on where you live. In general, gas furnaces are a better choice for colder climates. They have lower fuel costs and often are more efficient than their electric counterparts.Electric furnaces have their upsides, though. They’re significantly cheaper and easier to install and maintain. They also have a longer lifespan, lasting up to 30 years. Unlike a gas furnace, you won’t have any concerns around carbon monoxide safety with an electric furnace. If you live in an area where natural gas is expensive and/or you get your energy from renewable sources, an electric furnace may be the better option.Gas Vs. Electric Range OvenWhether your current range is toast or you’re looking for an upgrade, there are plenty of options when choosing between gas and electric range ovens. The best versions of either gas or electric are going to deliver high performance and proficiency. It’s down to what you prefer for your kitchen.According to Consumer Reports, flattop electric ranges have outperformed gas ranges in terms of their power output range. Flattop electric stoves are also incredibly easy to clean if a pot boils over or oil splatters out of the pan.The downside to electric stoves is they don’t respond as quickly to changes in heat. Electric heat elements can take longer to heat up and longer to cool down. Consumer Reports also found that gas ovens outperform electric in terms of even baking.In terms of operating costs, gas range ovens are usually cheaper to run, even if all the heat from the burners isn’t used as efficiently as an electric range. The upfront costs to purchase and install a gas range oven are significantly higher than the electric variety. These units can cost around 50% more to purchase than their electric counterparts.

What’s The Cost To Convert Energy Sources?

Converting from electric to gas is much more difficult than converting from gas to electric in most cases. Since you already have electric throughout the house, it’s not hard to add an electric line for a new stove or electric water heater. Running a gas line for gas appliances is much more expensive.

According to HomeGuide, the average cost to run a gas line for a new gas appliance can cost $350 - $750. That doesn’t include the cost of installing the actual appliance. There may be other costs on top of this depending on your current setup.

For instance, if your home is currently heated with electric baseboard heat, switching to a gas furnace will require new ductwork to be installed. This can easily add hundreds if not thousands in additional costs.

Still, the cost savings on utility bill of switching to gas or electric may be worth it. Depending on what’s more affordable in your area, the upfront costs could be recouped due to lower utility bills.

Should I Power My Home With Gas Or Electricity?

There are pros and cons of using gas or electricity. Most homes are on the electrical grid, but only about half of them have access to natural gas. Natural gas appliances are more affordable to operate, but are generally more expensive to purchase and install. Still, if the power goes out, you’ll be able to use your gas appliances.

There are some big drawbacks to gas. You have to access to a natural gas supply and there’s additional danger of a gas leak. On top of that, natural gas is a nonrenewable fuel source, so its affordability is directly tied to its supply.

The main drawback with electric appliances is they cost more in operation. Otherwise, they’re cheaper to buy and install, generally have a longer lifespan, require less maintenance and are more energy-efficient. On top of that, if you ever plan to get power from renewable sources (like solar or wind), you’ll need electric appliances to take full advantage of that.

The Bottom Line: Pick The Energy Source That Works For You

What it boils down to is you need to pick the right energy source for you and your house. Both gas and electric have their upsides and downsides. If your home is setup for just electric, do the math to determine if installing gas lines is worth it for the monthly utility bill savings. Depending on where you live, the savings may not be that great.

If you’re concerned about your major appliances going down, consider getting a home warranty to cover their repair and replacement, giving you one less thing to worry about.

Andrew Dehan

Andrew Dehan is a professional writer who writes about real estate and homeownership. He is also a published poet, musician and nature-lover. He lives in metro Detroit with his wife, daughter and dogs.