Is Your Oversized Furnace Wasting Your Money?

Sealed Combustion Furnace

Sealed Combustion FurnaceAn oversized furnace is a very wasteful shortcut taken by many LEED homebuilders and HVAC service providers.

The result is that many unsuspecting homeowners are straddled with an appliance that overly dries their indoor air, wastes copious energy, and sends a lot of money right up the chimney.

When it comes to heating appliances, bigger is usually not better. The only truly green heating or cooling system is one that is appropriately sized for the building.

HVAC Efficiency Numbers

The most common heating appliance efficiency rating you will probably encounter is known as the Annual Fuel Utilization Efficiency rating (AFUE).

To be clear, AFUE is a rating of efficiency for combustion furnace or boiler appliances, to include natural gas, propane, and fuel oil. A typical builder-grade open-combustion gas furnace will likely have an AFUE of between the mid to high 80% range. High efficiency sealed-combustion gas heating appliances can attain efficiencies of 95% or even a little more.

Heat pumps, similar in construction to an air conditioner with the addition of an extra valve, move thermal energy from outdoor air to indoor air during the summer, and then from indoor air to outdoor during the summer months.

Heat pump efficiency ratings are expressed as SEER (Seasonal Energy Efficiency Ratio). The higher the SEER number, the greater the efficiency of the appliance.

Electric resistance heat appliances can be assumed to have a near 100% efficiency rating, since the fuel conversion efficiency loss occurs at the utility. Note that while the efficiency of electric resistance heat appliances is high (all electrical energy is converted to heat), these are usually not the most economical heating options.

The Efficiency of Nearly All Heating and Cooling Equipment Suffers If the Unit Is Oversized

In the case of combustion heating equipment, a unit that is too large for the area and heat load that it is serving will short-cycle, meaning that the published efficiency rating of the unit cannot be reached.

The efficiency rating of any appliance assumes that the unit has reached a steady-state of operation during the majority of a burn cycle. When a heating appliance first starts, efficiency is low, but quickly increases until a steady-state at or near the published efficiency rating is reached.

A furnace that is too large for the building being heated will come on, and then cycle off before the unit reaches an efficient operating state, since the building has quickly reached the thermostat temperature set-point. Over time, the furnace cycles through many short, inefficient burns, none of them lasting long enough to reach an efficient operation state.

A properly sized unit will have a lower thermal output and stay on longer, spending most of the operational duty cycle in an efficient burn state and saving money in the process.

An Oversized Furnace May Not Last Long
Newer high efficiency sealed combustion gas appliances may suffer from a reduced useful life when oversized. Short-cycling is detrimental to the secondary heat exchanger in these units.

This was one of the big industry shake-ups when these units first hit the market. HVAC contractors who had forever installed units oversized for the homes they were being placed in, continued these practices with high-efficiency units. The result was that many homeowners experienced total failure of their new heating equipment in a short period, all because the wrong sized unit was installed.

Modulated Combustion: The Best of Both Worlds
High-end combustion heating units may feature modulated combustion technology. Utilizing both exterior and interior thermostats, along with a microprocessor logic system, these units produce reduced heat output for longer burn cycles when only a little heat is needed, and then can ramp up thermal output when it’s really cold outside.

At any point in the operational cycle of modulating heat appliances, the most efficient operating state can be maintained.

Sizing a Furnace
The US Standard for HVAC equipment sizing is the Air Conditioning Contractor’s Association of America (ACCA) Manual J and Manual S. Other sizing tools such as building load calculation software and system designed software should be based on the ACCA guidelines, calculations, and data.

The ACCA Standards evaluate heating and cooling load based on a large number of factors to include climate, home insulation, window size and grade, and several other important data variables.

Any contractor who uses a rule of thumb or “professional experience” to size your heating system is, at best, only guessing. It is just as likely that they are selling you the product that gets them the biggest commission check.

Make no mistake, guessing is going to cost you every time you pay your heating energy bill.

The bottom line is that any heating installation contractor your hire should guarantee that your new furnace will be appropriately sized for the actual heating needs of your building using the ACCA standards. In my opinion, any contractor who gives any other answer should be dismissed.

If you worry that your current furnace may be oversized, a reputable residential energy auditor should be able to evaluate your home and determine if your system is appropriately sized.

About the Author:

David Arthur is a LEED-AP and Energy Auditor. He is the editor of