What Is the Most Efficient Heating and Cooling System

The best heating and cooling system is the one that takes the size of your house, your lifestyle, and the climate that you live in into consideration.

The most efficient systems available on the market today are geothermal heat pumps; they are great for old or small houses and cold climates. For old houses that have a radiator system, opt for a boiler, and portable heaters can be an efficient option for tiny homes.

Below you will find all the information needed to choose the perfect heating and cooling system for your particular case.

The Energy Efficiency of Different Heating and Cooling Systems

Heating/Cooling SystemEfficiency Ratings
Heat pumpsThe ratings should be above 14 SEER (Seasonal Energy Efficiency Rating). Heat pumps with ratings above 18 are highly efficient.
Air conditionersThe most energy-efficient air cons have a SEER between 20 and 26.
FurnacesHighly efficient furnaces have an AFUE (annual fuel utilization efficiency) of 90% or higher. An electric furnace is the most efficient type and might have an AFUE that is as high as 100%.
BoilersAccording to ENERGY STAR, the AFUE rating of oil boilers should be at least 87% and the rating of a gas boiler – over 90%.
Portable heatersPractically all portable heaters are considered to be close to 100% efficient.
Wood heatersSome systems are up to 80% efficient.

Heat Pumps

Heat pumps transfer heat from the outside during the heating season and pump the heat from the inside of your house to the outside during the cooling season.

These systems use electricity and do not generate heat. They simply transfer the air from one area to the other.

  • Air-source heat pumps

An air-source heat pump is a system that is connected by ducts. This type makes the heat travel between your home and the outside.

The newer models of air-source heat pumps can reduce your electricity consumption by up to 50% (if compared to a regular furnace). 

By the way, air-source heat pumps can do a great job at dehumidifying the air in your house during the warmer time of the year.

  • Geothermal heat pumps

You can get a heat pump installed in your house, even if you don’t have ducts. In such a case, go for a geothermal option.

These pumps transfer the heat between the home and a water source or the ground. The temperatures of the soil and water are relatively constant and this is exactly what makes this system extremely energy-efficient.

In fact, the system is able to reduce energy consumption by up to 60%. Moreover, the pump is able to control the humidity levels.

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However, do bear in mind that a geothermal heat pump can’t be installed in every house. They are suitable only for homes surrounded by appropriate landscapes.


Out-of-date models are inefficient and sometimes even dangerous. But newer systems that utilize new technologies have extremely high efficiency levels.

Hint: an AFUE is an indicator of the efficiency of your furnace (the number helps you figure out how much energy is converted into heat). The systems that have an AFUE higher than 90% are highly efficient.

  • Gas furnaces

The heating efficiency of natural gas is relatively low. But the operational costs of such a system are among the cheapest.

  • Oil furnaces

It is much more expensive to run an oil furnace than one that uses gas. But such heating systems have high AFUE ratings (between 84% and 90% for the newer models).

  • Electric furnaces

The main advantage of such a furnace is that it doesn’t burn any fuel, which means no gases that can pose a safety hazard.

Moreover, electric furnaces are able to convert 100% of electricity into heat, so it definitely has very high energy efficiency.


Even though residential boilers are not as common as furnaces and heating humps, they can still become a great heating option.

In fact, some boilers have an AFUE higher than 90%. Condensing boilers are even more efficient – their ratings can reach 95%.

The latter use exhaust gases to extract heat, while residential boilers work by heating up water which then travels through your house’s pipes.

Portable Heaters ; Wood Heating

  • Portable Heaters

Electric heaters are typically 100% efficient.

Such heaters can come in handy if you need to heat one room. However, trying to warm up the whole house with the help of portable heaters alone might not be the best decision as it would cost you a small fortune.

  • Wood Heating

In some cases, you’d be able to maximize the efficiency of your wood heater to about 75%.

You can choose to go for a centralized heater that burns not only wood but also combustible gases. Such an option might be great for areas that have plenty of wood, but overall, these heaters are made more for show rather than efficiency. 

Most Efficient Heating System for Old House

When it comes to improving an old house, the fewer changes are required – the better.

  • Boilers

Did you know that a lot of houses that were built in the 18th century already have a radiator system installed?

This means that the buildings have a boiler, pipes, and radiator units that will help you keep the house warm.

The great news is that existing radiators are, in the majority of cases, still in good condition. So, all you would have to do is install a new, more energy-efficient boiler.

You might want to go for a modulating-condensing boiler. This device doesn’t heat up all the water at once, it increases the temperature of a certain portion that is able to bring the home’s temperature to a comfortable level.

  • Heat pumps

Practically all old houses don’t have enough space for ductwork. That’s why the only thing that you can do is go ductless.

Heat pumps have a single outdoor condenser and one or more indoor units. These quiet systems require only a small hole in the wall.

Heat pumps are incredibly energy efficient as they offer zoned heating which means independent control over the air handlers and efficient targeted usage. 

Most Efficient Heating System for Cold Climates

A good-quality heat pump is the most efficient heating and cooling system for the majority of homes, including the ones located in cold areas.

A lot of homeowners might be hesitant about investing in a heat pump as they have heard that these systems become inefficient as soon as the temperatures drop.

Thankfully, modern heat pumps utilize advanced technology that allows the system to remove the heat from the air even when it becomes freezing cold outside. Such solutions will cost you a small fortune at the moment, but things are going to change for the better in the nearest future.

Until then, here are a few things that you should remember when using a heat pump to keep your house nice and toasty.

  • Don’t be afraid of the defrost cycle.

Every heat pump has such a mode for the times when ice forms on the outside unit. The system will need around 15 minutes to melt the ice and then it is ready to get back to its normal mode.

  • Pairing your heat pump with another heating source can be a good idea.

If you live in an area where it tends to get extremely cold, the system might not be able to cope with the freezing temperatures efficiently.

For such days, you can have a backup plan. For example, a gas furnace.

Such a ‘dual-fuel’ strategy is still much more efficient than simply having a furnace running all winter long.

Best Heating System for Small House

Your choice of the heating system would certainly depend on your specific case.

These are a few options that you might want to consider.

Heating SystemFeatures
Electric heaterThe easiest and cheapest option for a tiny home, but do bear in mind that such heaters take up valuable floor space.
Propane heaterThis one is relatively cheap, burns clean, and you can use the heater to cook.But it sometimes might be challenging to find the fuel.
Wood stoveA good option for the people who enjoy the wood-burning process. Moreover, you are not dependent on electricity and you can sometimes use the top of the stove to heat food.However, wood-burners are messy and can be a safety hazard.
Heat pumpWith a heat pump, you can do both heat and cool your house. These systems are also highly efficient and don’t require any floor space.But the initial cost might be too high for some.

To Sum Up

What is the most efficient heating and cooling system?

A geothermal heat pump certainly does have the highest efficiency ratings, but it might not be the best choice for your particular situation.

So, make sure to take the climate you live in, the size of your house, safety, and, of course, the price point into consideration before making a final decision.