Heating cost, Tennessee
What It Costs to Heat a Home in Tennessee This Winter (2026-27)
Short answer: heating a typical 2,000 sq ft home in Tennessee costs about $574 a year with the cheapest option, a natural gas furnace, and about $2,396 with the most expensive, a heating oil boiler. Heating oil runs $2,396 and propane $1,772.
By Marcus Reed. Updated Nov 3, 2026. Part of our heating cost by state study.
Yearly heating cost in Tennessee, by system
| System | Tennessee a year | US average | Fuel used |
|---|---|---|---|
| Natural gas furnaceCheapest95% AFUE | $574 | $831 | 502 therms |
| Air-source heat pump8.1 HSPF2 | $776 | $1,138 | 5,888 kWh |
| Propane furnace95% AFUE | $1,772 | $1,631 | 549 gallons |
| Electric resistance100% | $1,842 | $2,702 | 13,977 kWh |
| Heating oil boiler85% AFUE | $2,396 | $2,788 | 405 gallons |
Estimates for one reference home: 2,000 sq ft, average insulation, a normal winter. Equipment, maintenance, fan and pump electricity and tank rental are not included.
How Tennessee compares
Tennessee ranks 43rd most expensive of 50 places with a real heating season when each uses its cheapest option, and 43rd for a gas furnace. Its gas figure of $574 is 31% below the US average of $831.
The climate explains part of it. Tennessee averages 3,785 heating degree days a year (1991-2020 normal, weighted by where people live), 89% of the contiguous US figure of 4,230, so the same house needs 47.7 million BTU of heat a winter against 53.3 nationally. The rest is prices: electricity at 13.2 cents per kWh against a US average of 17.3, and the fuel prices below.
Is a heat pump worth it in Tennessee?
On running cost alone, an air-source heat pump costs $776 a year here. That is $1,620 a year less than heating oil, $996 less than propane and $1,066 less than electric baseboards. A gas furnace is still $202 a year cheaper where gas service is available.
Sizing decides whether a heat pump keeps up. Use our central heat pump size calculator for a ducted house or the mini-split calculator room by room.
Prices used for Tennessee
- Electricity
- 13.2 cents per kWh
- EIA 2025 state average
- Natural gas
- $1.14 per therm
- EIA state average
- Propane
- $3.23 per gallon
- EIA October 2026, state average
- Heating oil
- $5.92 per gallon
- EIA October 2026, regional average (PADD 2 (Midwest))
Where the EIA does not publish a Tennessee figure, we use its regional or US average and say so above. The full method and sources are in the main study.
Lowering the bill
- A setback schedule on a smart thermostat trims heating energy by about 8% by ENERGY STAR's estimate, about $46 a year on the natural gas furnace figure here.
- A space heater only saves money if the rest of the house is allowed to cool. At 13.2 cents per kWh a 1,500 W heater costs about $0.20 for each hour it runs on high; see what a space heater costs to run.
- Air sealing and attic insulation lower every number on this page in proportion, because they cut the heat the house needs.
Tennessee heating cost FAQ
How much does it cost to heat a house in Tennessee?
For a 2,000 sq ft home with average insulation in a normal Tennessee winter: $574 with a natural gas furnace, $776 with an air-source heat pump, $1,772 with a propane furnace, $1,842 with electric resistance heat, $2,396 with a heating oil boiler. That uses EIA prices for Tennessee and its 1991-2020 normal of 3,785 heating degree days.
What is the cheapest way to heat a home in Tennessee?
A natural gas furnace, at about $574 a year for our reference home. The next cheapest is an air-source heat pump at $776, and the most expensive is a heating oil boiler at $2,396. If you have no gas line, the choice is usually between a heat pump, propane and oil.
Is a heat pump cheaper than oil or propane in Tennessee?
Yes against oil: about $1,620 a year less. Against propane it saves about $996 a year. That uses a 8.1 HSPF2 heat pump.
How much heating oil or propane does a house in Tennessee use in a winter?
Our 2,000 sq ft reference home needs about 405 gallons of heating oil in an 85% efficient boiler, or 549 gallons of propane in a 95% furnace, in a normal Tennessee winter. Smaller or tighter homes use less; a cold winter uses more in proportion.
Marcus Reed
Founder and Editor, CrunchYourDollars
Marcus Reed builds the sizing tools on CrunchYourDollars. He is a software engineer with a long-running PC hardware and power supply habit, which is where the watts, watt-hours and surge math on this site comes from. Product specs are pulled from manufacturer data sheets, electricity rates from the U.S. Energy Information Administration, and water chemistry rules from the Water Quality Association. He is not a licensed electrician or plumber: the tools show the math and the matching models so you can make the call, and anything involving your electrical panel should be checked by a licensed pro.
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