Propane vs Natural Gas Furnace: Fuel Cost, Conversion Kits, Venting and Tank Sizing

Last updated October 8, 2026 | By Michael Haines, Founder, AC Direct

A propane furnace and a natural gas furnace are the same appliance fitted with a different burner orifice and gas regulator through a manufacturer LP conversion kit. The decision is about fuel: natural gas usually costs less per BTU where a main exists, propane works anywhere a tank fits, and the furnace itself heats the house the same way on either fuel.

If you are weighing a full furnace replacement decision this season, start with the fuel question. The equipment choice gets easier once you know what is coming into the house.

And one commercial note before we get back to the engineering: we carry Goodman and ACiQ gas furnaces that ship configured for natural gas and accept a manufacturer LP conversion kit, which is the standard path for a propane install. If you want to browse the catalog, our propane furnace category lists every size and efficiency tier we stock, with wholesale pricing and no installation markup baked in. That is the one sales paragraph in this article. Everything else is how to decide.

Is a propane furnace a different furnace?

No. A propane furnace is the same physical appliance as a natural gas furnace, with two components changed: the burner orifices and the gas valve regulator spring. Most modern residential furnaces ship from the factory configured for natural gas and are field-convertible to propane using a manufacturer-approved LP kit. The cabinet, blower, control board, heat exchanger and venting are identical.

The reason the industry works this way is practical: a manufacturer can build one furnace line, ship it anywhere, and let the installer finish the configuration for the fuel actually arriving at the house. The National Fuel Gas Code (NFPA 54) permits conversion only in accordance with the manufacturer's instructions, which is why a universal "any brand" conversion kit does not exist. The kit matches the model.

What changes mechanically comes down to two fuel properties. Propane carries far more energy per cubic foot of vapor than natural gas, and it burns at a higher manifold pressure. Typical natural gas manifold pressure is roughly 3.5 inches of water column. Typical propane manifold pressure is roughly 10.0 inches of water column. If you leave the natural gas orifices in place and raise the pressure to propane levels, you dump far too much fuel into the burners. So the orifices shrink.

After conversion, the furnace's permanent nameplate is updated with a sticker from the kit stating the unit now runs on LP gas per the manufacturer's instructions. That label matters later, when a service tech or a code inspector needs to verify the configuration. Which brings up the next natural question.

How does propane compare to natural gas on energy and cost per BTU?

Propane holds about 91,452 BTU per gallon of liquid. Natural gas holds about 100,000 BTU per therm, or roughly 1,036 BTU per cubic foot, according to the EIA energy units reference. To compare the two honestly, you convert both to the same unit, usually dollars per million BTU, then compare. Price per gallon against price per therm is not a comparison.

Here is the arithmetic without the arithmetic. Take your propane price per gallon from your last delivery ticket. Divide it by 91,452. That is your dollars per BTU on propane. Then take your natural gas price per therm from a utility bill. Divide it by 100,000. That is your dollars per BTU on natural gas. Whichever number is smaller wins on fuel cost. In most of the country where a utility main exists, natural gas wins by a comfortable margin because the pipeline infrastructure spreads delivery cost across millions of customers. Propane does not have that scale advantage.

The EPA default heat content tables give the same propane figure rounded to 0.091 million BTU per gallon, which is useful if you want to work in MMBtu directly. Either way, the math is pedestrian. The mistake is skipping it.

Two cautions on the number you land on. First, propane prices move more than natural gas prices, with winter deliveries pricier than summer pre-buys. If you set up an auto-fill contract with your supplier, you may get a locked summer rate that changes the math meaningfully. Second, natural gas utility bills include a fixed monthly service charge that propane does not. On a small, well-insulated home the fixed charge can swing the per-BTU comparison; on a large, heat-hungry home it rounds to nothing.

How do you convert a gas furnace to propane?

Conversion is a four-step procedure performed by a qualified gas technician: remove and replace the burner orifices with the smaller propane orifices in the LP kit, swap the gas valve regulator spring, verify inlet and manifold pressure with a manometer and adjust to the propane spec, then label the nameplate. The NFPA 54 fuel gas code requires that conversion follow the manufacturer's written instructions. There is no code-approved shortcut.

If you only remember one thing about this process, make it the manometer step. Changing the orifices without verifying manifold pressure is the single most common conversion error we hear about from service techs. The furnace runs. It appears to work. It is also quietly over-fired or under-fired, which shortens heat exchanger life, raises carbon monoxide risk and ruins the efficiency the AFUE rating promised.

What a correct conversion looks like step by step

The parts cost of an LP propane conversion kit is modest, usually a small fraction of the furnace price. Labor is where the real cost sits, because the manometer verification takes time to do correctly. That is a bargain compared to replacing a heat exchanger that failed because the burner was over-fired for six winters.

How big a propane tank does a furnace need?

Tank size is set by the total BTU input of every propane appliance in the home, your climate's vaporization demand, and how often you want fuel deliveries. A typical whole-house setup pairs an 80,000 to 100,000 BTU furnace with a 500 gallon above-ground tank. Smaller homes with lower loads sometimes use 250 or 320 gallon tanks. Add a water heater, range, dryer or generator and the number grows.

Two facts drive this. First, propane tanks are filled to about 88 percent of water capacity at 60°F per EPA guidance referencing NFPA 58, so a 500 gallon tank holds roughly 400 usable gallons. Second, propane has to vaporize from liquid to gas inside the tank before it can reach your furnace, and vaporization rate depends on the surface area of liquid propane touching the tank wall and the outdoor temperature. A nearly empty tank in January has less liquid, less surface area and less vaporization capacity, exactly when the furnace wants the most fuel.

Now the field problem to watch for. In January, in Idaho, with a 500 gallon tank well below a quarter full, the furnace fires, the water heater fires, the generator fires, and the tank cannot vaporize fast enough. Pressure sags, the furnace low-pressure switch opens (if the installer added one) and heat stops. If the switch is not there, combustion stays running but ragged. The tank's exterior frosts up, which is where "the propane froze" comes from. Nothing froze. The physics ran out of surface area.

The fix is boring and effective: size the tank with winter demand in mind, keep it comfortably above a low fill level through heating season, and sign up for automatic delivery. Monitoring your own tank gauge every two weeks in February is a hobby that ends badly.

Does venting or installation change with propane?

For modern condensing (Category IV) gas furnaces, venting does not change with fuel type. The same PVC, CPVC or ABS vent materials apply, the same slope back toward the furnace for condensate drainage, the same termination clearances from windows and doors, and the same combustion air calculation based on total BTU input. Fuel changes the orifices and regulator. It does not change the flue.

The reason is chemistry. Both natural gas and propane are hydrocarbons. Combustion byproducts for both are carbon dioxide, water vapor and nitrogen, with similar acidic condensate when water vapor drops below its dew point in the heat exchanger and secondary coil. The vent materials chosen for Category IV equipment are selected to resist that condensate on either fuel.

Combustion air is sized from the appliance's BTU input rating. The ICC combustion air guidance walks through indoor combustion air calculations based on total input rating, giving the same volume per BTU regardless of which fuel the appliance burns. A 100,000 BTU furnace needs the same combustion air whether it is burning propane or natural gas. For a full breakdown of flue types, materials and clearances, our furnace venting requirements explainer covers it.

The one propane-specific installation detail

Propane is heavier than air and accumulates in low or below-grade spaces when it leaks. The NFPA LP-Gas fact sheet describes this pooling behavior and the hazard it creates in basements, pits and other low areas. In practice that means a basement, crawlspace or sunken utility room with propane appliances benefits from a leak detector mounted near floor level, where the gas would actually collect. Natural gas, by contrast, is lighter than air, which is why its detectors are typically mounted higher.

So the installation story on the furnace side is: identical venting, identical combustion air, identical condensate handling. The propane-specific work lives outside the furnace, at the tank, the regulator and the gas piping.

When does natural gas make more sense, and when does propane?

Natural gas makes more sense when a utility main is already at or near the property line, because operating cost per BTU is typically lower and there is no tank to fill. Propane makes more sense when the home is beyond the gas main, when a gas extension would run thousands of feet, or when the homeowner wants fuel independence from a utility. The furnace does not care. The site conditions do.

Here is the honest trade-off most pages dance around. If the natural gas main is in the street in front of your house and the utility's tap fee is reasonable, waiting a few months for a connection usually beats installing propane. Lower per-BTU cost, no tank monitoring, no delivery scheduling. If the main is a quarter mile down the road and the utility wants to charge you to trench the extension, the math flips hard. We have talked to homeowners quoted extension costs that would take decades to recover against propane's higher per-BTU fuel cost. In that situation propane is not a compromise; it is the correct answer.

Two illustrative situations

Consider a 2,200 square foot home in a suburb where a natural gas main runs under the street and the utility's connection fee is in the low four figures. The homeowner installs a 95 AFUE natural gas furnace, pays the connection, and sees heating fuel costs that beat propane year after year. The decision was straightforward.

Now the same house, same furnace, in a rural county where the nearest gas main is 1,800 feet away and the utility quotes a steep per-foot extension cost. The homeowner installs the identical furnace model, orders the LP conversion kit, installs a 500 gallon tank set 10 feet from the house, and signs up for automatic delivery. The furnace heats the house the same way. The fuel costs more per BTU. The total project costs far less than the extension would have. Both decisions were correct for their site.

If you want to see how a homeowner in a specific propane market thinks through this choice, our Boise propane furnace guide works through local considerations in detail. The framework applies anywhere, with your fuel prices substituted for Idaho's.

One more thing worth saying out loud: picking a higher AFUE furnace matters more on propane than on natural gas, because every BTU costs more. The efficiency difference between a mid-80s and 95+ AFUE unit shows up faster on a propane bill than on a utility bill. For the full comparison, our 80 vs 95 furnace breakdown walks the math.

What should a mobile or manufactured home use?

A mobile or manufactured home should use a furnace specifically listed and certified for manufactured home installation, which is a narrower product category than site-built residential furnaces. Both natural gas and propane are available in these units; fuel choice follows the same logic as any other home. The constraint is the furnace certification, not the fuel.

Manufactured home furnaces are a separately listed category with their own installation rules on closet clearances, duct connections and venting. A standard residential furnace is not the same listing and should not be substituted even if it fits the space. On the efficiency side, the ENERGY STAR Manufactured New Homes program recognizes gas and propane furnaces at 90 AFUE and above, with higher efficiency tiers required for the colder climate zones.

Because most manufactured homes are placed on sites without a natural gas main, propane is overwhelmingly the fuel of choice in this category. The furnace ships configured for natural gas and gets converted with the manufacturer's LP kit at the same time it is installed, exactly as in a site-built home. If you need the right equipment for this application, our propane furnace for mobile home category lists only units certified for manufactured home use. Do not substitute a site-built model to save money. That substitution ends badly in multiple ways, none of them cheap.

Propane vs natural gas at a glance

One table, so the comparison lives on a single screen. Every value here is sourced in the sections above.

Notice what is identical in that table and what is not. The furnace side is almost entirely identical. The fuel side is almost entirely different. That is the whole article in one grid.

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