Heat pump vs. gas furnace in Memphis, TN
Memphis technically pencils out, but only past the point the equipment would need replacing anyway. Against a like-for-like gas furnace and AC swap, going electric costs $3,500 more up front here (already netting out a $2,000 tax credit). Memphis's residents would see roughly $161 a year back in running costs, putting the payback around 21.8 years. Memphis's own numbers say this pencils out only in theory, not in practice.
The climate behind Memphis's payback figure
2396 heating degree days pile up here every year, so Memphis has a mild winter by US standards; the cooling side runs to 2383 cooling degree days, where summers are hot enough that cooling matters as much as heating. The 99% winter design temperature here — the cold snap equipment must be sized for, not the seasonal average — is 12°F, against a record low of 1.9°F. That puts the seasonal coefficient of performance at 2.99 for the recommended cold-climate unit. A cold-climate unit is the right call in Memphis — below 25°F design temperature, a standard heat pump leans hard on electric-resistance backup, which erases most of the savings. Source: NOAA station MEMPHIS INTERNATIONAL AIRPORT, 3.8 miles from Memphis — the closest one on record.
The month-to-month numbers for Memphis
Modelled on a typical 2000-square-foot house, the heat pump draws about 2,029 kWh a year to keep it warm, plus cooling, for a combined electric bill near $563 a year. Memphis's gas rate of 11.84 per Mcf, applied to the 25 Mcf a year the furnace burns, puts its running cost near $724 a year, against 13.87¢ per kWh for electricity. Priced as a standalone purchase rather than against a like-for-like replacement, equipment payback runs about 84.1 years, for a 15-year net position $1,092 behind.
If your home heats with electric baseboard instead of gas
Gas isn't universal in Memphis — many houses run on electric heat already. Against electric-resistance heat — baseboard or an electric furnace, both 100% efficient but still just resistance — the case for switching gets stronger here. Switching saves about $707 a year here — a heat pump moving heat rather than generating it needs far less electricity than resistance coils — so the extra $8,000 spent up front comes back in about 11.3 years.
Where Memphis ranks in this dataset
Among 3206 cities, Memphis's winter puts it at rank 2237 for severity, while its size puts it at rank 29 for population — 1 in both cases being the extreme. That's the mildest third of cities covered, where utility rates carry more of the answer than climate does.
Deciding what's next in Memphis, TN
About 610,919 people live in Memphis, Tennessee, and every number on this page is what a contractor would actually work from when quoting a system here — the point isn't to replace that quote, it's to tell you whether to bother asking for one. Here, there's no cost penalty to waiting until your current furnace or AC actually needs replacing.
Line up a few local HVAC quotes before you decide.
More on how this number was built
Nothing above is a black box: the methodology guide shows the full arithmetic behind Memphis's 2.99 seasonal COP and payback figure. Memphis's 12°F design temperature is below the 25°F line, which is why a cold-climate unit is the right call here — see what that changes in the cold-climate unit guide.