Heat pumps have been the most-asked-about topic on our service calls for two years running. The questions have shifted — they used to be "do these things even work in our winters?" and now they're "what's it actually going to cost me, and when do I break even?"
So let's do the math for an actual SD&G home, with real local fuel prices and real climate data, and see where the answer lands.
The short version
If you currently heat with propane or oil in our service area, a cold-climate heat pump will almost certainly save you money. Typical payback for the system is 3 to 5 winters, after which you're effectively heating for free relative to your old fuel cost.
If you heat with natural gas — which a minority of SD&G homes do — the math is closer. Heat pumps still win on operating cost for cooling and shoulder-season heating, but the winter math depends heavily on your electricity rate.
Let's break that down.
What "cold-climate" actually means
A cold-climate heat pump (CCHP) is just a heat pump engineered to maintain useful heating capacity at very low temperatures. The standard rating to look for is the Northeast Energy Efficiency Partnerships (NEEP) cold-climate listing, which certifies units that retain at least 70% of their rated heating capacity at -15°C.
The best units on the market now (Mitsubishi Hyper-Heat, Daikin Aurora, Fujitsu XLTH) deliver useful heat down to -25°C and the equipment doesn't shut off until somewhere around -30°C. For context: Winchester's coldest January night last decade was around -34°C. That happens maybe two or three nights per winter.
The implication: a CCHP will handle the vast majority of your heating hours on its own. For the handful of extreme nights per year, you have a backup — either an electric resistance coil built into the air handler, or your existing furnace held in reserve.
The fuel cost numbers
Working numbers for spring 2026 in SD&G:
- Propane: roughly $1.10 per litre (residential delivery, varies by supplier and route)
- Heating oil: roughly $1.65 per litre
- Natural gas: roughly $0.40 per cubic metre (delivered)
- Electricity: roughly $0.13 per kWh blended rate (time-of-use), Hydro One
Now convert those to what we actually care about — cost per useful kWh of heat delivered into your home:
- Propane furnace (95% AFUE): about $0.115 per useful kWh
- Oil furnace (85% AFUE): about $0.155 per useful kWh
- Natural gas furnace (95% AFUE): about $0.044 per useful kWh
- Heat pump at COP 3.0 (typical cold-climate seasonal average): about $0.043 per useful kWh
That heat pump number is the seasonal average — at -25°C the COP might be 1.8, but at +5°C in October it's pushing 4+. The seasonal blend lands around 3.0 for a well-installed CCHP in our climate.
What this tells us:
- Propane → heat pump: about 63% reduction in heating cost.
- Oil → heat pump: about 72% reduction in heating cost.
- Natural gas → heat pump: roughly break-even on heating cost alone, but you get free AC built in.
A real example
Take a typical 2,000 sq ft Winchester home on propane, using 3,500 litres per winter. That's about $3,850/year just on heating fuel.
After switching to a cold-climate heat pump:
- Annual electricity for heating: roughly $1,400
- Annual savings: about $2,450
For a typical CCHP install (single-zone ducted, integrated with existing air handler): roughly $9,000 to $12,000 before rebates. After federal Greener Homes Grant and IESO rebates, net cost often lands in the $5,500 to $8,000 range.
At $2,450 in annual savings, payback comes in about 2.5 to 3.5 winters. After that, you're banking the savings — plus you have central AC at no additional operating cost, which the propane furnace did not provide.
For an oil-heated home, the math is even better because oil is more expensive than propane per useful kWh.
When the math doesn't work as cleanly
A few caveats from us doing this every week:
- Very old homes with poor insulation lose so much heat that no system runs efficiently. We've turned down heat pump quotes on a few drafty stone houses and sent the homeowners to an insulation contractor first.
- Homes already on natural gas don't see the same heating-cost win. Heat pumps still make sense for these homes for cooling and shoulder-season efficiency, but the simple-payback story is weaker.
- Homes with no existing ductwork can still get heat pumps via ductless mini-splits, but the install logistics are different. See our guide on ductless mini-splits in SD&G.
- Lot-specific electrical capacity matters. A few older Mountain and Brinston homes have 100-amp service that needs upgrading before a heat pump install — that's a $1,500-$3,000 add to the project. We check this on every site visit.
What we won't do
We don't quote heat pumps from a square-footage chart. Every cold-climate install we do gets a proper Manual J heat-loss calculation, an existing fuel-bill review, and a discussion of what backup strategy you want. A heat pump that's undersized for your home is a worse experience than the furnace you're replacing — we're not in the business of selling that.
Next step
Want us to run the actual numbers on your home? Call (613) 363-9011 or request a free assessment. We'll review your last 12 months of fuel bills and give you a real proposal, not a generic estimate.
We do this conversion math at least once a week. There's a good chance your home falls inside a pattern we've already seen.