Lower Bills, Cleaner Air: Heat Pump Benefits for Homes Relying on Delivered Fuels

This briefing by RMI outlines the economic, health, and environmental benefits of transitioning over 10 million US homes that rely on delivered fuels (oil and propane) to electric heat pumps. It provides data on potential energy savings, carbon pollution reduction, and recommends specific policy interventions and outreach strategies to accelerate this transition.

• More than 10 million single-family and manufactured homes in the United States currently use delivered fuels such as oil and propane for heating or water heating, with two-thirds of these homes located in the upper Midwest and Northeast.
• Switching to air-source heat pumps (ASHPs) and heat pump water heaters (HPWHs) can save delivered fuel households an average of $970 annually and nearly $15,000 over the equipment's lifetime. If all such customers in the US switched, total annual energy bill savings would reach nearly $8 billion, with the highest individual savings occurring in the Southeast due to low electricity prices.
• Heat pumps reduce carbon pollution by approximately 60 percent in the first year for a delivered fuel home, which equals 3.9 metric tons of carbon dioxide equivalent (MTCO2e)—comparable to a gas vehicle's annual tailpipe emissions. New York sees the largest state-wide benefits, saving over 4.4 million MTCO2e per year.
• Delivered fuels contribute to outdoor air pollution (PM2.5, NO2, and sulfur dioxide) and indoor pollution (carbon monoxide, NO2, and volatile organic compounds). Electric heat pumps eliminate these direct emissions and improve indoor air quality by filtering and controlling humidity.
• To facilitate the transition, RMI recommends that states allow fuel switching in utility energy efficiency programs—noting that 17 states currently prohibit or discourage incentives for over 3 million delivered fuel households—and implement clean heat standards. Colorado and Vermont have already enacted such legislation, while nine other states (CT, HI, MA, MD, NJ, NY, PA, RI, IL) are considering them.

APA

RMI (2025). Lower Bills, Cleaner Air: Heat Pump Benefits for Homes Relying on Delivered Fuels. https://rmi.org/resources/lower-bills-cleaner-air-heat-pump-benefits-for-homes-relying-on-delivered-fuels/

Chicago

RMI. Lower Bills, Cleaner Air: Heat Pump Benefits for Homes Relying on Delivered Fuels. 2025. https://rmi.org/resources/lower-bills-cleaner-air-heat-pump-benefits-for-homes-relying-on-delivered-fuels/.

Wikipedia

{{cite report |author=RMI |title=Lower Bills, Cleaner Air: Heat Pump Benefits for Homes Relying on Delivered Fuels |date=7 May 2025 |url=https://rmi.org/resources/lower-bills-cleaner-air-heat-pump-benefits-for-homes-relying-on-delivered-fuels/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2025lower, author = {{RMI}}, title = {{Lower Bills, Cleaner Air: Heat Pump Benefits for Homes Relying on Delivered Fuels}}, institution = {RMI}, year = {2025}, month = may, url = {https://rmi.org/resources/lower-bills-cleaner-air-heat-pump-benefits-for-homes-relying-on-delivered-fuels/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }