Gas Heat vs. Electric Heat: Which Is Best for Your Business?

If your business is struggling with high heating costs, frequent system breakdowns, or environmental concerns, you’re not alone. The heating system you choose can have long-term impacts on energy bills, maintenance requirements, and sustainability goals. Making the wrong decision could lead to inefficiencies, unexpected expenses, and even regulatory challenges.

At Harold Brothers Mechanical, we've helped countless businesses navigate the gas vs. electric heating debate, ensuring they choose the most cost-effective and efficient solution.

In this article, we’ll compare gas and electric heating systems across key factors—energy efficiency, cost, sustainability, maintenance, safety, and more—so you can confidently select the best option for your commercial building.

Gas vs. Electric Heating: Which is More Energy Efficient?

When choosing a heating system for a commercial building, energy efficiency is a top priority—it directly impacts operating costs and environmental footprint. But which system delivers the most heat for the least energy?

Gas Heating

Gas heating systems, such as furnaces and boilers, typically offer high thermal efficiency. Modern high-efficiency gas furnaces can achieve an AFUE (Annual Fuel Utilization Efficiency) rating of up to 98%, meaning almost all the fuel is converted into usable heat. 

However, some energy is lost through combustion and ventilation, making gas heating less efficient than electric systems. This is especially true when the gas furnace is not properly sealed or maintained, leading to additional heat loss through drafts or improper venting. 

Electric Heating

Electric heating systems, including heat pumps, electric furnaces, and baseboard heaters, convert nearly 100% of electrical energy into heat at the point of use. Heat pumps, in particular, can achieve efficiencies greater than 100%, often producing  three times more energy than they consume.

Key Takeaway: Heat pumps are the most efficient option, especially in moderate climates. Gas furnaces remain reliable in extreme cold but may have slightly lower efficiency due to combustion losses.

Which Heating System is More Affordable to Install?

Gas Heating

Gas heating systems often have higher upfront installation costs due to the need for:

✔ Gas line infrastructure- A commercial gas line infrastructure in Massachusetts typically includes a main gas line connecting to the property, service lines running to individual appliances, meters to measure gas usage, shut-off valves, pressure regulators, and necessary fittings, with the average cost for installation ranging from $500 to $2,000 per 10 linear feet of piping depending on the length of the line, complexity of installation, and local labor rates; factors like permits and materials also contribute to the total cost.

✔ Ventilation systems- A commercial HVAC ventilation system infrastructure in Massachusetts typically includes: air handling units, ductwork, dampers, return air grilles, supply air diffusers, controls, outdoor units (for cooling), heating sources (like boilers or furnaces), exhaust fans, and potentially energy recovery systems; the average cost for a commercial HVAC system installation can range from $6,000 to $30,000 depending on the building size, complexity, and chosen equipment, with larger buildings costing significantly more.

✔ Combustion safety measures-Commercial combustion safety measures in Massachusetts include fire prevention, carbon monoxide safety, and open burning restrictions. 

Electric Heating

Electric heating systems, such as heat pumps and electric furnaces, generally have lower initial costs because they don’t require gas lines or exhaust systems. Heat pumps, in particular, are easy to install in modern buildings.

Key Takeaway: Electric heating has a lower installation cost, while gas heating requires more infrastructure investment.

Long-Term Cost Comparison: Gas vs. Electric Heating

Gas Heating

Natural gas is often cheaper than electricity per unit of energy, making gas heating more cost-effective in many regions due to accessibility. However:

• Natural gas prices fluctuate, leading to unpredictable costs.
• Older gas systems lose efficiency over time, increasing operating expenses.

Electric Heating

While electricity rates can be higher, heat pumps offset this cost through their high efficiency. However, during extreme cold temperatures, electric resistance heating, a method that uses electricity to generate heat, may be required, which can significantly increase costs.

Key Takeaway: If natural gas prices remain low in your area, gas heating may be more cost-effective. However, heat pumps can reduce electricity expenses through superior efficiency.

Which Heating System is More Eco-Friendly?

Gas Heating

Natural gas is a fossil fuel, meaning it produces carbon dioxide (CO₂) emissions when burned. While it’s cleaner than coal or oil, gas heating still contributes to climate change. Additionally, methane leaks from pipelines increase its environmental impact.

Electric Heating

If powered by renewable energy sources, electric heating can be nearly emissions-free. Heat pumps, in particular, are among the most sustainable heating options. However, if your electricity comes from fossil fuel-based power plants, the environmental benefits diminish as  they are considered a major source of air and water pollution with detrimental effects on human health and ecosystems. 

Key Takeaway: Electric heating is the greener choice, especially when paired with renewable energy BUT electricity from fossil fuel plants significantly impacts the environment. 

Maintenance Requirements: Gas vs. Electric Heating

Gas Heating

❌ Requires regular inspections for gas leaks and combustion efficiency.
❌ Components like heat exchangers, igniters, and flues can wear out over time.
❌ Improper maintenance can lead to carbon monoxide (CO) leaks.

Electric Heating

✔ Fewer moving parts result in lower maintenance needs.
✔ Heat pumps require occasional servicing but generally experience fewer mechanical failures.
✔ Electric baseboard heaters have virtually no maintenance requirements.

Key Takeaway: Electric heating requires significantly less maintenance than gas heating.

Which Heating System is Safer?

Gas Heating Risks:

⚠ Carbon monoxide poisoning if ventilation fails.
⚠ Gas leaks can lead to explosions.
⚠ Strict safety regulations and inspections are required.

Electric Heating Risks:

⚠ Overloaded circuits could pose a fire hazard.
✔ No carbon monoxide risk or gas leaks.

Key Takeaway: Electric heating is generally safer, eliminating the risks associated with combustion and gas leaks.

Which Heating System Lasts Longer?

Key Takeaway: Gas furnaces and boilers will last longer, but electric heating systems experience less wear and tear due to the absence of combustion elements.

Are Incentives Available for Gas or Electric Heating?

• Gas Heating: Some jurisdictions are phasing out gas heating due to environmental concerns. Future regulations may limit gas system installations.
• Electric Heating: Government incentives and rebates are available for heat pumps and energy-efficient electric heating systems.

Key Takeaway: Switching to electric heating could make you eligible for financial incentives and future-proof your building.

Which Heating System is Right for Your Business?

✅ Gas heating is ideal if:

• Your building is in an extremely cold climate where gas remains more efficient.
• Natural gas prices in your area are significantly lower than electricity costs.
• You need long-lasting, high-output heating with minimal efficiency loss in cold temperatures.
  
  

✅ Electric heating (especially heat pumps) is ideal if:

• Your business prioritizes sustainability and reducing carbon emissions.
• You want lower maintenance costs and enhanced zoning control.
• You want to take advantage of government rebates for energy-efficient heating.

If you’re weighing the decision between gas and electric heating, it ultimately comes down to cost, efficiency, and sustainability. Choosing the wrong heating system can lead to unexpected expenses, maintenance issues, and potential regulatory concerns. 

If you’re looking for a cost-effective, low-maintenance solution, heat pumps might be the best fit. Heat pumps provide a cost-effective and low-maintenance solution for commercial businesses seeking efficient heating and cooling. Their energy efficiency, durability, and ability to operate year-round make them a smart investment for reducing operational costs while maintaining a comfortable environment. If your business values sustainability and long-term savings, a heat pump could be the ideal choice to meet your heating and cooling needs.

But if your business operates in extreme cold, gas heating could be more reliable. Unlike some alternative heating systems, gas heating performs efficiently even in frigid temperatures, ensuring that your operations remain uninterrupted. With its dependability and ability to generate high heat output, gas heating is a practical choice for businesses that need a robust solution to withstand harsh winter conditions.

At Harold Brothers Mechanical Contractors Inc., we specialize in helping commercial buildings choose the most efficient and cost-effective heating solutions. Contact us today for a free consultation on your building’s needs.