What is HVAC? | Furnace Compare ®

Home heating systems are an important investment. Whether you’re fixing an older system or installing a new one, it’s important to understand what you’re buying to make the right choice for your specific space. In this guide, we provide an overview of HVAC systems, including how they work, the different types and how their energy efficiency is measured. We also detail the benefits and average costs for each of these units.

HVAC stands for…

HVAC is an abbreviated way of saying heating, ventilation and air conditioning. Each of those words describes a part of what makes up most heating and cooling systems. The purpose of these units is to control the environmental conditions of your inside space. According to the Department of Energy, Americans spend approximately $11 billion annually on monthly heating and cooling costs for their homes. That means there’s a lot riding on installing the most appropriate, efficient and highest quality HVAC system for your home.

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$5,000 – $6,000

This estimate is based on current data and is not a guaranteed price. For accurate pricing contact a local HVAC pro.

Here are a few brands we recommend:


Founded over 100 years ago, Trane is a well-known provider of HVAC products systems.

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Lennox specializes in innovative technologies that maximize efficiency and minimize noise.

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Goodman HVAC systems are proudly designed, engineered and assembled in the U.S.A.

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*Estimate is based on current data and does not represent a guaranteed price. For accurate pricing contact a local HVAC dealer.

Types of HVAC systems

There are four primary kinds of HVAC systems. Each work differently, has separate benefits and are priced differently. In this section, we’re detailing each of those differences to help you determine which is best for your home and budget.

Central heating and cooling systems

Most residential heating and cooling systems are designed with a central air conditioning system alongside a heating system, like a furnace or boiler. Central air conditioners work using the same ductwork system as your forced-air heating system. Those ducts help circulate the cool air the system produces. Furnaces heat air and use ductwork to circulate it throughout the home. Boilers heat water that flows through a home’s radiator system.

Statistics gathered by the Department of Energy indicate that Americans spend an average of $3,460 on energy bills. That breaks down to 29% for heating and 13% for cooling. The benefits of a high-efficiency heating and cooling system include increased energy efficiency, better air quality, lower energy bills, quieter operation and more precise temperature control. Expect to pay between $7,000 and $10,000 for the heating and cooling system including installation. 

The prices for HVAC systems vary according to the type of system. For example, if you’re looking for a Trane HVAC system, you’ll see different pricing for air conditioners, furnaces, and heat pumps. The average price for an air conditioner ranges between $7,500 and $12,000. A furnace’s price ranges between $4,500 and $7,500 and a heat pump’s price range between $9,000 and $13,000.

Ductless systems

A ductless system delivers cool or warm air directly into a specific zone of a home. These systems have a straightforward design that includes one small outdoor unit and another for inside. Often they’re also referred to as split systems, split-ductless systems, multi-split systems and mini-split systems.

The benefits of using a ductless system include improved air quality thanks to their multi-stage filtration, straightforward installation and greater efficiency. Expect to pay between $1,900 and $7,500 for a single zone system. If you’re looking for a multi-zone system that includes between two and four indoor units, those prices range between $6,600 and $10,500.

Commercial HVAC systems

Commercial HVAC systems keep the inside spaces of commercial buildings, including hospitals, hotels, restaurants, office buildings and schools, comfortable. These systems control the temperature and air quality within the structure using radiators and ventilation systems. The benefits of a commercial HVAC system include increasing indoor air quality and overall comfort with reliable and energy-efficient heating and cooling.

HVAC system efficiency

Below, you’ll find information about the energy efficiency of the primary HVAC unit types. This information also details what counts as an energy-efficient unit.

Central heating and cooling systems

A central air conditioner’s energy efficiency is measured using SEER (Seasonal Energy Efficiency Ratio). That’s the measurement for this unit’s cooling efficiency. According to the Department of Energy, air conditioners must have a minimum of 13 SEER if you live in a northern area of the United States, and 14 SEER if you live in the Southeast or Southwest.

A gas furnace’s efficiency is measured using annual Fuel Utilization Efficiency, or AFUE. That’s the percentage of fuel that converts to energy. The minimum AFUE for gas furnaces is at least 95% for northern parts of the United States and at least 90% for southern areas. Oil burners must have at least 85% AFUE. Hot water boilers must have at least a 90% AFUE if they’re gas-fired and 87% if they’re oil-fired. If you’re using a steam boiler, the AFUE for a gas-fired unit must be at least 90%. If it’s oil-fired, it must have an AFUE of at least 87%

Ductless systems

The cooling efficiency for a ductless system is similar to that of a central air conditioner as far as using SEER to measure its efficiency. Heat pumps also follow the same guidelines regarding a minimum of 13 SEER in northern parts of the country, and at least 14 SEER in the Southeast or Southwest. A heat pump’s heating efficiency is measured using HSPF (Heating Seasonal Performance Factor). The minimum HSPF for split-system heat pumps is 8.2 and 8.0 for split-package systems.

Commercial HVAC systems

Commercial HVAC systems include commercial air conditioners, commercial heat pumps and mini-split systems. Their energy efficiency is measured using the Energy Efficiency Ratio or EER. Compared to the Seasonal Energy Efficiency Ratio, or SEER, EER is calculated using a set inside and outside temperature. Energy-efficient commercial air conditioners must have at least a 12.2 EER. Commercial heat pumps must have an EER of between 10.7 and 11.8. Commercial mini-split systems must have at least 12.0 EER for air conditioners and between 10.7 and 11.8 EER for heat pumps.


How much is a new heating and cooling system?

Pricing for a new HVAC system can range between $900 and $4,200 depending on the type of unit you choose. For example, central air conditioning units can range between $3,400 and $12,000. If you choose a gas furnace, expect to pay between $1,600 and $7,500.

What is split system heating and cooling?

Split systems are central air conditioners or heat pumps that heat and cool your home. When the split system acts as an air conditioner, it moves heat from inside your home and moves it outside. In heating mode, the split system draws warm air from outside to heat interior spaces.

What is HVAC, and how does it work?

Commercial and residential buildings get heating and cooling from HVAC units. It is an acronym for Heating, Ventilation and Air Conditioning. HVAC units work by using an air return, blower, coils, compressor, ducts, electrical elements, exhaust and filter.

What is the difference between HVAC and AC?

HVAC and AC are both acronyms, but they mean two different things. HVAC is what refers to Heating, Ventilation and Air Conditioning. AC stands for Air Conditioning. While all AC units cool a home, not every HVAC unit has a heating option. For example, some HVAC units are only for cooling, some are only for heat and other units do a combination of the two.

What are the types of HVAC systems?

There are five primary types of HVAC systems, including commercial HVAC systems, split heating and cooling systems, packaged heating and cooling and ductless systems.

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