TL;DR: A cold-climate heat pump will heat a custom home in eastern Idaho and Teton Valley through a normal winter, and on most of our builds it is now the primary system. But I still put a furnace or a boiler behind it on anything above about 6,000 feet, because our design temperature runs near -10°F and a single point of failure at -10°F is not a design, it is a gamble. The honest answer for 2026 is usually both: a cold-climate heat pump doing 80 to 90 percent of the hours, with gas or propane backup for the rest.
Contents
- Heat pump or furnace: which one belongs in an Idaho custom home?
- Will a heat pump even work when it is below zero here?
- What does a heat pump cost compared to a furnace?
- Why propane changes the whole math in Teton Valley
- What is a dual-fuel system, and is it the safe middle?
- Do mini-splits make sense in a custom home?
- I want radiant floors. Does that settle it?
- Why the house decides this before the equipment does
- What is Manual J, and why will I not spec a system without one?
- Where does fresh air and ventilation fit in?
- Are there still tax credits for this in 2026?
- What is not included when someone quotes you a number?
- How this actually gets decided on a SwagerBuilds build
- FAQ
Heat pump or furnace: which one belongs in an Idaho custom home?
If you are building new in eastern Idaho or Teton Valley, a cold-climate heat pump should be your starting assumption, and a furnace should be the thing you add on purpose rather than the thing you default to. That is a real change from how I was speccing houses even five years ago, and it is not because of a rebate or a trend. It is because the equipment finally got good enough at low temperatures to be the primary heat in a well-built house at 6,000 feet.
Here is the part most articles skip. A heat pump is not a different kind of furnace. It is an air conditioner that can run backwards. In summer it moves heat out of your house. In winter it moves heat from the outdoor air into your house, which sounds impossible when it is 5°F outside, but cold air still holds heat energy. The machine just has to work harder to find it. That is the entire argument in one sentence: a heat pump moves heat, a furnace makes heat. Moving is cheaper than making, right up until it gets cold enough that moving gets hard.
So the question is never really “which one is better.” It is “at what outdoor temperature does the cheap option stop being the cheap option, and what happens the night it does.” Everything below is me answering that for the specific valleys we build in.
Will a heat pump even work when it is below zero here?
Yes, if you buy the right one, and no, if you buy a standard one. That distinction is the single most expensive thing a homeowner can get wrong on this decision, and almost nobody explains it.
A standard air-source heat pump has no low-temperature performance requirement at all. None. It can meet its efficiency rating entirely on mild-weather performance and fall off a cliff at 20°F, and it still gets to be called a heat pump. A cold-climate unit is a different product held to a different bar.
To carry the ENERGY STAR Cold Climate designation, an air-source heat pump has to deliver a coefficient of performance of at least 1.75 at 5°F, hold at least 70 percent of its 47-degree heating capacity down at 5°F, and hit HSPF2 of 8.1 ducted or 8.5 non-ducted along with SEER2 of 15.2. Those thresholds are published in the ENERGY STAR key product criteria for air-source heat pumps, and that capacity-retention number is the one that matters most here.
Translate it: a cold-climate unit at 5°F still has roughly three quarters of the output it had at 47°F, and it is still producing about 1.75 units of heat for every unit of electricity it draws. A standard unit at the same temperature might be at 40 percent of capacity and barely better than a resistance coil. Same category, same marketing word, completely different machine.
Now the local number. The 99 percent winter design temperature we calculate to in Teton Valley runs right around -10°F, and on the Idaho Falls and Rigby side it is milder, closer to -5°F. Design temperature means the house has to hold temperature in weather that cold, not that it never gets colder. It does get colder. We have all watched the thermometer go past -20°F in Driggs.
At those temperatures even a cold-climate heat pump is losing capacity and its efficiency is approaching break-even against straight electric heat. That is not a failure of the technology. It is physics, and it is exactly why I do not leave a house with only one heat source. For more on what our winters actually do, I wrote up the eastern Idaho climate year-round in detail.
What does a heat pump cost compared to a furnace?
I am going to be careful here, because there are two different kinds of numbers and mixing them is how people end up angry.
SwagerBuilds does not publish an equipment rate card. Our custom home pricing starts at $400 per square foot and goes up on the Idaho and Teton Valley side, and starts at $1,000 per square foot and goes up on the Jackson Hole side, and mechanical is inside that, specified to the house we actually design with you. What I can give you is third-party market data so you can see the relative shape of the decision. The ranges below are 2026 national market figures from HomeGuide, not SwagerBuilds pricing and not a quote:
| System (2026 market data, installed) | Typical range | Notes |
|---|---|---|
| Ducted air-source heat pump | $10,000 – $25,000 | $20,000 – $32,000 on homes over 3,500 SF |
| Ductless mini-splits | $2,000 – $17,000 | Scales with the number of indoor zones |
| Gas furnace, 80-89% AFUE | $3,800 – $6,200 | Needs a flue; not what I would install new |
| Gas furnace, 90-95% AFUE | $5,200 – $8,800 | Condensing, PVC venting |
| Gas furnace, 96%+ AFUE | $7,500 – $12,000 | Where new construction should start |
Read that table correctly. The furnace line looks cheaper because it is only half a system. A furnace heats and does nothing in July. A ducted heat pump is your heating and your air conditioning in one box, and air conditioning is no longer optional in this valley the way it was when I started. Smoke season alone has made a sealed, filtered, conditioned house a comfort item people will not give up. If you are comparing a furnace price to a heat pump price, the fair comparison is furnace plus air conditioner against heat pump alone, and the gap closes most of the way.
The second half of cost is the part nobody quotes: what it costs to run. That depends almost entirely on what fuel you can actually get at your lot, which brings us to the thing that decides this more than any brand or SEER rating.
Why propane changes the whole math in Teton Valley
There is no natural gas service in Driggs, Victor, or Tetonia. None. If you are building in Teton Valley, combustion heat means a propane tank on your property, delivered by truck, at a price that moves with the market and with how far up a snowy road your house sits. Idaho Falls, Ammon, Rigby, and Rexburg do have natural gas, and that single utility fact flips the recommendation.
Natural gas in Idaho Falls is cheap, stable, and piped. A high-efficiency furnace burning natural gas is genuinely hard to beat on operating cost at deep-winter temperatures, and I will spec one without hesitation on a Bonneville or Jefferson County build. Propane is a different animal. It carries a tank, a delivery schedule, a seasonal price swing, and a real failure mode where the truck cannot get up your driveway in February. When the alternative fuel is propane, the heat pump’s running-cost advantage gets much wider, and the case for making it the primary system gets much stronger.
| Where you are building | What I usually lead with | Why |
|---|---|---|
| Idaho Falls, Ammon, Rigby, Rexburg | Cold-climate heat pump with a 96%+ natural gas furnace as dual-fuel backup | Natural gas is piped and cheap, so backup costs almost nothing to own and run |
| Driggs, Victor, Tetonia, Alta | Cold-climate heat pump as primary, propane furnace or boiler sized as true backup | No gas service; propane is the expensive fuel, so you want to burn as little as possible |
| Jackson Hole side | Heat pump plus hydronic or propane backup, engineered per lot | Colder design temps, bigger houses, stricter review; the load calc drives it |
| Off-grid or weak-service lots | Combustion primary, heat pump only after the electrical service is confirmed | A heat pump is an electrical load; if the service cannot carry it, nothing else matters |
That last row is not theoretical. Electrical service capacity has killed more heat pump plans on rural Idaho lots than cold weather ever has, and it is one of the things we check during site evaluation rather than discovering at rough-in. If you are starting from raw ground, that whole category of problem is covered in how to prepare land to build a house in Idaho.
What is a dual-fuel system, and is it the safe middle?
Dual-fuel means one system with two heat sources and a thermostat smart enough to pick between them. The heat pump runs whenever it is the cheaper option. Below a crossover temperature you set, the furnace takes over. One set of ductwork, one thermostat, two ways to make the house warm.
On most of our builds this is the answer, and I will say plainly why: it removes the argument. You get heat pump economics for the vast majority of winter hours, because the vast majority of winter hours in eastern Idaho are above 20°F, not below zero. And you get a combustion appliance standing by for the week in January that makes the news. You are not betting your house on a single machine at -15°F, and you are not paying propane prices in October.
Where I set the crossover matters. Set it too high and you burn expensive fuel on mild days for no reason. Set it too low and you run the heat pump into its inefficient range and your electric bill spikes. On a natural gas house the crossover usually lands lower, because gas is cheap enough to hand off earlier without much penalty. On a propane house it lands higher, because every gallon you avoid burning is real money. That is a tuning decision, not a product decision, and it is one of the things I stay on top of through the first winter after you move in.
Do mini-splits make sense in a custom home?
In the right places, yes. As a whole-house strategy on a $2 million custom home, usually no, and I will tell you that even when a client has read that mini-splits are the efficient choice.
Ductless mini-splits are excellent at conditioning a specific space independently. Where they earn their keep on our builds is a bonus room over a garage that the main system fights, a detached office, a shop space, a guest suite that needs its own setpoint, or a great room with a wall of glass and a load nothing else wants to carry. Those are real problems and a mini-split solves them cleanly.
What I do not like is a custom home with eight wall cassettes hanging in eight rooms. You get indoor heads on your walls in a house where you paid for the millwork and the window detailing, you get eight filters nobody remembers to clean, you get refrigerant lines run all over the building, and you get no central filtration, which matters more every smoke season. A ducted system with a properly designed distribution layout gives you hidden equipment, one filter rack that can take a real MERV filter, and balanced air in every room. On a custom home, that is worth more than the handful of efficiency points.
The honest exception: a small, very tight, open-plan house can be heated well by two or three mini-splits and it is a legitimately good solution. It is just not what most people building a $1 million-plus custom home are describing to me.
I want radiant floors. Does that settle it?
No, and this is the most common mix-up I untangle in design meetings. Radiant floor heat and a heat pump are not competing choices. Radiant is a delivery method. A heat pump is a heat source. You can absolutely have radiant floors fed by an air-to-water heat pump instead of a boiler.
What radiant does not do is cool, dehumidify, filter, or ventilate. So if you want radiant floors, you still need an air system for summer and for air quality, and now you are buying and maintaining two distribution systems in one house. That is a legitimate choice. It is comfortable, it is quiet, and in a high-ceilinged mountain great room it feels different in a way people who have lived with it will not give up. It is also meaningfully more money, both up front and in maintenance, and it does not replace the decision in this article. I broke the economics down separately in what radiant floor heat costs in Idaho.
The pattern I see work best: radiant in the spaces where you will feel it every day, meaning primary bath, mudroom, and the main living floor, with a ducted heat pump handling the rest of the house, the cooling, and the filtration. Not radiant everywhere out of principle.
Why the house decides this before the equipment does
Here is the thing I wish every homeowner understood before shopping for equipment: a heat pump works better in a better house, and “better house” is not a vague compliment. It is insulation, air sealing, and glazing, and it is decided in design, months before anybody orders a condenser.
Idaho enforces the 2018 IECC with state amendments, effective January 1, 2021, which you can confirm through the Department of Energy’s state code status page for Idaho. In our climate zone that means roughly R-49 at the ceiling, R-22 in the walls or R-13 plus R-5 continuous, R-19 or R-15 continuous at basement and crawl walls, a U-0.30 window maximum, and an air-leakage target of 5 air changes per hour at 50 pascals. That is the legal minimum. It is not a target I am proud of hitting.
Why it matters for this decision: a tighter, better-insulated house has a smaller heating load, and a smaller load means the heat pump’s reduced capacity at 0°F is still enough to cover it. Build loose and you force the system into its weak range on exactly the nights you need it, then blame the heat pump. Build tight and the same equipment coasts. The envelope decision and the mechanical decision are the same decision made twice, and if you only have budget to upgrade one of them, upgrade the envelope. It lasts fifty years; the equipment lasts fifteen.
That is why these posts connect: spray foam versus blown-in insulation, whether triple pane windows are worth it in Idaho, basement versus crawl space versus slab, and the broader list of energy efficient custom home features worth paying for. Every one of them changes the size of the machine you need.
What is Manual J, and why will I not spec a system without one?
Manual J is the room-by-room heating and cooling load calculation for a house. It takes your actual plan, your actual window schedule and orientation, your actual insulation assemblies, your actual air-tightness target, and your actual design temperature, and it produces the number of BTUs each room loses on the coldest night. The ACCA Manual J standard is the ANSI-recognized method for this and national codes require it.
What happens without it is that somebody sizes your system off square footage and a rule of thumb, rounds up to be safe, and you get equipment that is too big. Oversizing is not harmless. An oversized system short-cycles, which means it blasts, satisfies the thermostat fast, and shuts off before it has evened out the house or pulled moisture out of the air. You get hot and cold rooms, more wear on the equipment, and worse comfort than a correctly sized smaller system would have given you. On a heat pump it is worse, because these systems are at their most efficient running long and steady at part load, which is exactly what oversizing prevents.
So on a SwagerBuilds build, the load calc comes before the equipment selection, and the duct design comes from the load calc, not from wherever the joists happened to leave room. That coordination with the mechanical engineer is part of what we handle in-house during design. You are not expected to go hire an engineer and bring us a spec. That is covered under our custom home design services and the design and engineering side of the business, and it is the main reason we lock scope before we lock a construction price. I wrote about why that order matters in the design phase and getting a real number before signing.
Where does fresh air and ventilation fit in?
If you build the house tight, and you should, you have to bring fresh air in deliberately. A tight house with no ventilation plan holds moisture, cooking odors, and whatever the air inside is doing. The equipment for this is an HRV or an ERV, a heat or energy recovery ventilator, which exhausts stale air and brings in fresh air while recovering most of the heat from the air it is throwing away.
HRV or ERV is a question I get asked as though it is a big fork in the road. In practice the real-world difference is slight. The usual summary from the building-science world, including GreenBuildingAdvisor’s take on HRV versus ERV, is that houses are happiest around 20 to 40 percent relative humidity while people are comfortable from 30 to 70 percent, and either machine, sized and commissioned correctly, will get you there in our dry climate. The thing that actually determines whether it works is whether it was sized right, ducted to the right rooms, balanced, and commissioned. An ERV installed badly is worse than an HRV installed well, every time.
Budget for it as part of the mechanical system, not as an upgrade. In a house hitting modern air-tightness numbers, it is not optional equipment.
Are there still tax credits for this in 2026?
No, and you need to hear that from somebody before you build a budget on a number you read in an old article. As of today, the federal residential clean energy and efficiency credits that used to apply here are gone. The 25C energy efficient home improvement credit is not allowed for property placed in service after December 31, 2025, and the 45L new energy efficient home credit is not allowed for a qualified home acquired after June 30, 2026. The IRS lays this out in its FAQ on energy efficient home improvement and residential clean energy credits.
Practically, that means a 2026 heat pump decision has to stand on its own operating-cost math, with no federal credit propping it up. The good news is that it still does, especially on the propane side of the pass. The bad news is that any quote or comparison you were handed before 2026 was built on assumptions that no longer exist. Same goes for utility and manufacturer incentives, which change on their own schedules. Verify anything you are counting on in writing, in the month you are buying.
What is not included when someone quotes you a number?
Every time a dollar figure shows up in a conversation about mechanical systems, the next honest question is what is missing from it. Usually a lot:
- Ductwork and distribution. Equipment pricing frequently assumes existing ducts. On new construction, the duct design and install is a real line item and it is where comfort is won or lost.
- Electrical service and circuits. A heat pump is an electrical load. Panel capacity, a dedicated circuit, and sometimes a service upgrade ride along with it.
- The backup appliance. If you are going dual-fuel, that is two pieces of equipment, not one.
- Propane tank, pad, line, and permitting where there is no gas service.
- The ventilator. The HRV or ERV, its ducting, and its commissioning.
- Load calculation and engineering. Manual J, duct design, and the engineer’s coordination.
- Commissioning and balancing. The step most commonly skipped, and the one that decides whether the system you paid for performs like the system you paid for.
- Snow and site realities. Outdoor unit placement up off the ground, out of the drip line, and clear of where the roof dumps. I have seen a condenser buried to the top by one slide off a metal roof.
This is the same pattern as every other part of a custom home, which is why I keep writing about it. If you want the full version of that conversation, read the hidden costs of building a custom home in Idaho and why three custom home bids do not compare. Mechanical is the single most common place where two bids look $30,000 apart and are actually quoting different houses. How allowances are written matters too, which I covered in construction allowances on a custom home.
How this actually gets decided on a SwagerBuilds build
I have been in construction 20 years and I am involved in every phase of every build we take, so this decision does not get handed off to whoever shows up to set equipment. The sequence looks like this.
During design, we lock the envelope first: assemblies, glazing, air-tightness target. Then the mechanical engineer runs the Manual J against that actual house, not a square-footage guess. Then we look at your lot: what fuel can get there, what the electrical service can carry, where an outdoor unit can live and survive a Teton Valley winter, and whether snow shed or a long driveway changes anything.
Then, and only then, we pick equipment and design the distribution. Then it gets installed, commissioned, and balanced, and I check the numbers myself rather than taking a startup sheet’s word for it. Then we are back through the first winter under the same workmanship warranty that covers the rest of the build, tuning the crossover point against real weather and your real bills.
Nine times out of ten in eastern Idaho that lands on a cold-climate ducted heat pump with a high-efficiency gas or propane furnace behind it, radiant in a few rooms where you will actually feel it, an ERV or HRV sized to the house, and a filter rack that can handle August. But I am not going to tell you that is your answer before I have seen your plan and your lot, because the whole point of a load calculation is that your house is not the average house.
If you are planning a custom home in Teton Valley, Jackson Hole, or eastern Idaho and want this settled properly instead of defaulted into at rough-in, start a conversation with us. Call the office at (208) 520-0636 or reach out through the site, and we will walk your lot and your plan before anybody talks about equipment.
Our pricing starts at $400 per square foot and goes up on the Idaho and Teton Valley side, and starts at $1,000 per square foot and goes up on the Jackson Hole side, with a fixed design fee quoted per project and a fixed construction price after design lock. You can see how that per-square-foot number behaves in practice in cost per square foot to build in Teton Valley and cost to build a house in Idaho per square foot.
FAQ
Can a heat pump heat a house in Idaho all winter by itself?
A cold-climate heat pump can carry a well-built Idaho house through nearly all of a normal winter on its own. I still install backup heat above about 6,000 feet, because our design temperature is near -10°F and real cold snaps go colder, where capacity and efficiency both drop. On a tight, well-insulated house in Idaho Falls or Rigby, a heat pump alone is more defensible than most people expect. In Driggs or Victor, plan on backup.
Is a heat pump cheaper to run than a propane furnace in Teton Valley?
In most hours of the heating season, yes, and that gap is wider in Teton Valley than almost anywhere else in the state because there is no natural gas service in Driggs, Victor, or Tetonia, so the alternative is trucked propane. The heat pump loses its advantage only in the coldest stretches, which is exactly what a dual-fuel setup with a tuned crossover temperature is built to handle.
What size heat pump do I need for a 3,000 square foot custom home?
There is no honest answer from square footage alone, and anyone who gives you one is guessing. Two 3,000 square foot houses in Driggs can differ by more than 40 percent in heating load depending on glazing area and orientation, insulation assemblies, and air-tightness. That is what a Manual J load calculation exists to answer, and it is run on your actual plan during design.
Do I need air conditioning in a custom home in eastern Idaho?
It is no longer something I would leave out of a new custom home. Summers run hotter than they used to and smoke season has made a sealed, filtered, cooled house something people are not willing to give up. The practical argument for a ducted heat pump is partly this: it is your air conditioning and your heating in one piece of equipment, so cooling stops being a separate purchase.
Are there any federal tax credits left for a heat pump in 2026?
No. The 25C energy efficient home improvement credit does not apply to property placed in service after December 31, 2025, and the 45L new energy efficient home credit does not apply to a qualified home acquired after June 30, 2026. Any article or quote assuming those credits is out of date. Check current utility or manufacturer incentives separately and get them in writing in the month you buy.





