Furnaces

With few exceptions, furnaces and installation are sold as package deals. Experts cite many valid reasons why furnace installation is not a do-it-yourself project. Syndicated columnist Tim Carter offers a detailed explanation. He concludes, "Furnaces and any fuel-burning heating device generates deadly carbon monoxide. Installing heating equipment improperly can be a recipe for disaster." Paul E. King, author of "The Furnace Book: The Heart of Your Home" says you can do it yourself. Several buyers who posted comments at Amazon.com say the book enabled them to install their own furnaces. Some furnace manufacturers will not warrant a furnace that isn’t installed by a licensed contractor, however.

We found very few dealers that sell furnaces a la carte, either locally or via the Internet. Prices from those dealers range from about $800 for a 45,000 BTU Goodman GMH950453BX 95% AFUE furnace to about $1,950 for a 90,000 BTU Ruud UGRL09EZAJS 95% two-stage gas furnace. People who buy furnaces with the expectation of doing their own installation are presumed to have professional expertise. Most contractors say choosing a reputable installer is more important than the brand of furnace you choose. The limited consumer information regarding relative brand quality leads us to believe consumers need to find a trustworthy contractor and select a contractor and furnace as a package.

Most installation businesses only sell one to three brands, but some service many brands. Contractors told us that referral business is critical to their success. They need satisfied customers to serve as references. Disreputable contractors in all types of residential services are an epidemic in the United States. Yet, we talked with contractors with years of experience doing business under the same name who intend to continue doing that. They are sincere in selling the brands they believe are best, and want to provide a level of service that will inspire you to recommend them to your relatives, friends and neighbors. Customer service ensures their business survival.

Choosing a contractor

Contractors say the first step in buying a new furnace is choosing the contractor who'll install it. Deciding between brands and models is a second step. Contractor brand choices are ideally based on the quality and reliability of the products, but may also be influenced by manufacturer incentives like cruises or cash rebates. All but one contractor we interviewed said finding a qualified contractor to install the furnace is more important than the specific brand. The dissenter said the two considerations are equally important.

If you don’t already have referrals for several contractors, the starting points are your local gas utility and local or state government. Some gas companies and government agencies certify contractors or maintain a referral list. Qualifications vary by company and jurisdiction. Call or check the websites of your local organizations for more information. While you’re doing that, you can also find out about local rebates. Many utilities and states offer rebates or tax credits for buying furnaces (and other appliances) that meet specified energy efficiency standards. For example, New Jersey offers a $300 rebate if you buy a 90% AFUE or greater furnace (and if you meet certain conditions). In addition to rebates, many public or regulated organizations also offer low-cost financing and heating assistance grants to low-income families.

If you’re considering buying a furnace from a big box store such as The Home Depot, find out how the store/chain screens its installers and which party is responsible for the installation warranty. We didn’t find any sources that recommend buying from a big box store.

Contractors agree that referrals and references are the most important selection criterion. They recommend calling references, preferably people who live near you. Otherwise, references could be a contractor’s mother or best friend. As with any service business, you can check several neutral resources to identify a public record of testimonials and complaints. Those include the Better Business Bureau, Angie's List and regional professional associations (such as a homebuilders’ association). Contractors should be licensed (if your state does that), bonded and insured.

Make sure that the contractor is certified by the North American Technician Excellence association (NATE). You can also check manufacturers' websites for premium installers who have met certain requirements and additional training designated by the manufacturer.

When you’ve narrowed your choices, contractors mention several other important screening tools. Ask how long the company has been in business. Find out how many years of experience their technicians have installing furnaces, and how many technicians they employ. An average of five to ten years experience is recommended. One contractor suggests that marketing materials are another indication of stability. At the least, a professional brochure implies that a contractor is making a long-term investment in the business.

Several contractors stress post-sale considerations. They are critical if you choose to buy a service contract, but also potentially important if you have a warranted hardware or installation problem. Some contractors offer some form of 24-hour service and many promise same-day service for a furnace emergency (no heat).

Experts say you should solicit free estimates from three furnace contractors. Each contractor should inspect your current furnace, including insulation, vent condition and vent configuration. Contractors determine the amount of BTU (British Thermal Units) your home will need by completing a Manual J Spreadsheet with computer software. This calculation takes into account the size of your home and its condition, as well as the climate where you live. The resulting figure (usually between 25,000 and 150,000 BTU) determines the furnace size. This is important, since an undersized furnace will not heat properly, and an oversized furnace, "besides raising purchase cost, will result in weaker energy efficiency due to excessive on-off cycling," according to the Department of Energy. If your insulation and/or windows have been upgraded since the last furnace was installed, chances are that you could get by with a much less powerful (and less expensive) furnace. A recent New Jersey study shows that most furnaces are significantly oversized, according to the state.

A good contractor will evaluate your entire heating system, and make appropriate recommendations, starting with whether to repair or replace the existing furnace. House and duct insulation, window upgrades and other energy efficiency improvements could make a bigger difference than a new furnace. Alex Walter, owner of Alex Walter Furnaces, A/C, & More in Aurora, Colorado, suggests that buyers of new homes bring in an HVAC contractor to inspect heating and cooling systems in addition to hiring a general inspector.

The Air Conditioning Contractors of America (ACCA) has established new standards for furnace installation. Some tips for consumers include making sure that the contractor furnishes proof of insurance, is knowledgeable about state and local building codes and ensures no more than 20% total duct leakage. The new guidelines are necessary because "there isn't a recognized level of quality installation across the entire industry," says Glenn Hourahan, vice president of research and technology at ACCA.

Contractors insist that prices are commensurate with the quality of service. Even within a region, we found that prices range from $2,100 to $6,000 for the same-brand furnace in an average sized (2,000 square feet) house. In any urban area, you’ll have no trouble finding competing installers that sell the same furnace brands. Expect to pay less for a Goodman (Goodman, Janitrol and Amana brands) furnace than other brands. Contractors say they are cheaper to buy (even those who defend the brand), and some maintain that installation costs may also be lower because Goodman is less selective about its authorized installers than other manufacturers are.

Hardware warranties may vary on paper, but in reality, contractors say they are administered pretty much the same way by most brands. Installation warranties vary up to lifetime in length. Service contracts also vary, and are not normally included in the purchase price. Some include parts, labor and maintenance, while others just cover labor or maintenance. Experts recommend annual furnace maintenance. Maintenance-only contracts commonly cost about $100 per year, which is a little cheaper than paying per service. So, with the exception of the installation warranty, service after the sale isn’t usually much of a factor in furnace/installation pricing.

Manufacturers refuse to disclose estimated installed costs. Experts agree that prices vary by region, and possibly even within a region. If you live in a development where multiple houses have the same floor plan, your neighbors may be the most accurate guide to good pricing. Make sure bids include all costs, including any government fees (such as permits) and disposal of the old furnace unit.

80% AFUE or high efficiency?

The EPA requires furnaces to have at least a 78% AFUE (annual fuel-utilization rating). This means that a minimum of 78% of the fuel consumed is directly converted to heat your home. The rest escapes through the flue. Currently, the most efficient furnaces you can buy have a 97% AFUE. If your furnace is more than 15 years old, it probably has an AFUE of only 65%, so improvements in energy conservation can have a direct impact on your fuel bill. Keep in mind that these energy efficiency ratings do not consider ducting. According to the Department of Energy and to other energy experts, 20% to 40% of heating energy ends up leaking through ductwork.

Expert posters to the HVAC-Talk forum acknowledge the importance of the AFUE rating in determining fuel consumption, but stress that contractor experience and warranty length are equally important. A high AFUE rating does not promise quality or satisfaction with the product after the furnace is installed. One contractor told us that a well-made 80% AFUE furnace can outperform a lower-quality 90% AFUE furnace.

James Dulley's latest report highlights the advantages of super-efficient two-stage condensing gas furnaces, which range from 92% to 96% AFUE. According to Dulley, the additional cost for these furnaces is offset by the decrease in heating bills which, when multiplied by the expected life of the furnace, can be a substantial savings. Units with a high efficiency rating make the most sense for those who live in areas with severe winters and high fuel prices. That's because these models can cost $1,000 more than 80% gas furnaces, and higher usage in cold climates means you'll be able to make the investment pay off sooner with decreased fuel bills. The other big reason to consider a 90% furnace is to cut down on wasted energy and help decrease the production of greenhouse gases.

Experts generally agree that an 80% efficiency furnace is acceptable if you plan to move within five years, or if you live in a milder climate where recouping the extra cost will take many years. Again, you'll need to ask a contractor to calculate energy costs in order to determine if the higher cost of a 90% unit will be worth it. Critics say you should ask the contractor to actually calculate energy costs using today's energy pricing to give you a relative idea of costs compared to what you're spending now. However, assuming that the costs of these finite natural resources continue to rise, your break-even return on investment will come sooner than projected.

The federal government offered a $150 tax credit to taxpayers who purchased a replacement gas or oil furnace or boiler with an AFUE rating of 95% or higher. That program expired December 31, 2007 and an extension failed to pass both houses of Congress. Congressional leadership still wants an extension. As we were preparing this report, Congress and the president have agreed on the core elements of a bill intended to increase consumer spending, and the final bill may include a rebate extension.

While we await resolution, many states and utilities offer their own tax credits or rebates for new high-efficiency furnace installation. See our Best Research section below for links. Though a tax break helps, most experts say there's not a huge performance gain from a 90% furnace to a 95% furnace, so you may be better off going with a less costly 90% model.

Although installing a more energy-efficient furnace can sound like a win-win plan for you and for the environment, there are some additional considerations. For one, replacing a low-efficiency furnace with a unit with over a 90% efficiency rating involves installing a vent that meets its needs, which can easily add hundreds of dollars more to the cost. While the difference between an 80% and a 94% AFUE furnace is noticeable, the difference between a 94% and a 96% AFUE is negligible, says Dave Hutchins, a 41-year HVAC veteran and owner and president of Bay Area Air Conditioning near Tampa, Florida.

Justin Crossen of D&R Heating & Air Conditioning in Canby, Oregon, maintains that a well-made 80% furnace can perform as well as some 90% furnaces. Several contractors told us that homebuilders install bottom-of-the-line models, regardless of brand. In fact, manufacturers often call them builder-grade furnaces. This is worth keeping in mind if you own a newer home with its original furnace. If you are faced with a repair-or-replace decision, any new furnace you buy is likely to provide a significant performance upgrade.

The American Council for an Energy-Efficient Economy recommends 90% furnaces, noting that they are much less likely to suffer from corrosion. That's because these high-efficiency models exhaust through a plastic pipe that exits through a side wall without using the chimney. Besides installation of a vent that meets the needs of a high-efficiency furnace, other appliances, such as a gas-fired water heater, may need modified venting, adding to total installation costs.

That said, the majority of contractors we interviewed, and articles and research papers we read, recommend furnaces with at least a 90% efficiency rating. An 80% furnace is fine for a rental property or for a homeowner on a budget, says Johnathan Youngs, owner of High Performance Heating & Air in Concord, California. "If it was in my house," he says, "I'd put in a 90%."

In summary, consider a high-efficiency furnace if you live in the Midwest or the Northeast, but realize that you may need to upgrade your vents and the long-term repair costs might be higher. In most cases, you should eventually recoup your investment in energy savings. The payoff period will be affected, however, by the climate, how well your home retains heat and the rates you pay for gas. On the other hand, if you live in a milder climate, an 80% furnace is a reliable, time-proven choice. Though your energy bills will be higher, the lower materials and installation costs might balance long-term costs, depending on how much energy costs rise and how many days per year you typically use your furnace.

Multi-stage furnaces

The latest industry trend is multi-stage furnaces. Two-stage furnaces are most common. Jim Dulley explains, "Two-stage burners operate at either a low-heat or a high-heat output level. The low-heat output level is usually about 60 percent of the high-heat output level." In comparison, a conventional furnace cycles either on or off. A multi-stage or modulating furnace minimizes room temperature fluctuations. Dulley says this type of furnace can cost up to a thousand dollars more than a conventional furnace.

The energy savings is small, but the comfort increase is substantial. Homeowner comments in forums reflect huge satisfaction with multi-stage furnaces. Dulley says they are reliable, too. The designs have undergone considerable long-term testing. Variable-speed blowers also operate more quietly.

Chad Jones, a heating and cooling service technician in Michigan says, "A two-stage variable-speed furnace no matter what brand will save you $200 to $300 per year on just your electric bill. The variable-speed blower uses only the equivalent of a light bulb’s electricity and a standard furnace uses about 600 watts of electricity when it is running. You will make your $600 back in about two to three years."

Furnace brands and features

According to large homeowner surveys, American Standard and Trane (the same company) furnaces are among the least repair-prone, and most of the contractors we interviewed ranked them among their top picks for reliability, regardless of whether or not they actually sold them. One dissenter, who sells Carrier furnaces, says Trane is the least reliable brand. He says the brand has more proprietary parts than others, and is therefore more expensive to repair. An American Standard contractor agreed that the brand has more proprietary parts than other brands, and offered a good technical explanation of why those parts were better. A Trane contractor disagreed with the premise, and pointed out many major parts that are sourced from third-party manufacturers.

The Trane XV90, for example, incorporates a variable-speed blower that delivers air more slowly and quietly when less heat is needed, using less electricity. Heat is thereby delivered continuously with fewer swings in temperature. Higher efficiency rates mean lower energy bills, but 90% gas furnaces can cost $1,000 more than 80% models. If you live in an area with harsh winters, such as the Midwest or Northeast, you'll eventually recoup this additional cost in fuel-bill savings. However, if you live in an area with milder winters, experts say an 80% AFUE furnace may be more cost-efficient in the long run. The Trane XV80 has a similar two-stage burner and variable-speed blower, features that experts say help furnaces run with fewer on-off cycles, which makes for less wear and tear. Trane now offers a three-stage gas furnace, the Trane XC95, rated at 95% AFUE. This model can actually communicate with your phone (with an extra-cost module), so you can dial-up the temperature remotely.

The Rheem Prestige Series 90 Plus Modulating with Contour Comfort Control is a high-efficiency furnace with two-stage modulating burners. This modulating furnace varies fan speed and heat automatically at the selected temperature within a variance of .5 of a degree. Conventional furnaces are either 100% on or 100% off, resulting in a temperature variation of around five degrees between cycling on and off. The Rheem (along with the Trane furnaces), however, varies its blower power to maintain a more consistent air temperature with less power-consuming on/off cycling. The downside is the price. The savings on lower utility bills may not be enough to justify the expense of the furnace plus installation if you live in a climate with only moderate winters. Contractors we interviewed generally praised Rheem. But one contractor, Rob Dowd, a service manager for DiFilippo's Service in Paoli, Pennsylvania, says he has witnessed a lot of Rheem equipment fail and criticizes the company for poor technical support. However, none of the other contractors we spoke to have such critical words for Rheem. This furnace is also available as the Ruud Ultra Series.

Reviewers say the Bryant Evolution Plus 90i series (also sold as the Carrier WeatherMaker Infinity 96 series) is the best choice among super-high-efficiency gas furnaces with AFUE ratings from 94.1% to 96.6%. Columnist James Dulley praises this unit's heat/blower controls, and according to the American Council for an Energy-Efficient Economy (ACEEE), the Infinity series’ electric motor uses the smallest amount of electricity (105 to 258 kilowatts per year). Armstrong makes a similar 95% gas furnace with an excellent repair record. If your contractor offers the choice, the Armstrong unit may be a couple hundred dollars cheaper.

We did read some comments that Carrier/Bryant models need repairs more often, and are more difficult and expensive to repair because of the high cost of parts. In spite of the class action suits (see above), both Carrier and Bryant have average to above-average long-term reliability. Bryant’s top line is called Evolution. The middle and bottom lines are Preferred and Legacy.

Lennox, Tempstar and York have supporters, including James Dulley, but reliability is below average, according to the latest survey data (which is quite outdated). Dulley commends the Lennox two-stage model for quiet operation.

The majority of households use natural gas fuel for furnaces, but if you live in an area where natural gas is not available, an energy-efficient oil-burning furnace is an option. Though there are a small handful of 95% oil furnaces on the market, the majority of oil furnaces aren't capable of the super-high AFUE rates that gas furnaces have achieved; 87% is typically the highest rating you'll find, and oil furnaces also have higher electrical demands. However, installing an 86% AFUE oil furnace to replace an old 60% AFUE furnace will still save fuel costs. ACEEE's efficiency ratings and interviews with oil-furnace contractors point to Thermo Pride oil furnaces, which have high AFUE ratings coupled with lower electrical costs.

Regardless of brand, Dulley says to install a sealed-vent model. He recommends a slew of brands. Among them, only Carrier/Bryant also makes gas furnaces.

Important Features: Furnaces

Here are some features and considerations experts say to think about when choosing a gas or oil furnace, assuming that the contractor has determined the correct size for your house.

• Super High Efficiency or 80%? If you live in an area with harsh winters, you should recoup the additional expense of super-high-efficiency (90% +) furnaces over the unit's lifetime. However, if your winters are more temperate, you may be better off with an 80% model. If you're unsure, have your contractor calculate fuel costs for both kinds of furnace, using your current bills; then you can tell if future fuel savings justify the additional $1,000 or more for a 90% furnace.

• Repair or Replace? Most experts agree that it's generally more cost effective to repair your existing furnace than to replace it, but if the heat exchanger or control module gives out, you should look at a new unit. This is especially true if your furnace is more than 15 to 20 years old. Proper maintenance, such as cleaning warm-air registers and baseboards and getting your system tuned up periodically, will save money in the long run.

• Multi-stage burners and variable-speed blowers are among the best features of this generation's furnaces. During milder weather, the furnace runs at a slower speed with less heat output, and then kicks into high gear when the temperature drops. This is more energy efficient and saves on wear and tear, since the furnace isn't always cycling on and off. They are also quieter, since they're not always running on high.

• Think about your air conditioner. If you plan to install or replace central air within the next couple of years, be sure to tell your contractor. He'll be able to recommend a furnace that's compatible with a future air conditioner. In some cases, you might want to put in air conditioning simultaneously with a furnace, since installation costs will be cheaper and you may qualify for a longer warranty period than if you did both projects separately.

• A digital thermostat can cut heating bills another 10% by maintaining more accurate temperature control. Programmable thermostats can keep the house at a lower temperature when you're not home or at night. These are also easy to install yourself.

• Noise can be a problem. If this concerns you, ask prospective contractors for the decibel ratings of the units they are proposing.

Experts stress the importance of taking your time to find a good HVAC professional. The best way to start is to ask friends and neighbors for references. Contractors should be licensed and have appropriate insurance, liability and workman's comp paperwork. You will need a permit before work is started, and you should ask your contractor to procure this for you so that the work can be checked by a local government inspector.

Even if you do everything right, editors at Consumer Reports magazine say that in recent years, about one-sixth of furnaces installed over an eight-year period ended up needing repairs.

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