AFUE stands for Annual Fuel Utilization Efficiency. It measures what percentage of the fuel a furnace or boiler consumes is converted into usable heat. For example, a furnace with a 96% AFUE rating converts 96 cents of every fuel dollar into heat, losing only 4 cents up the flue.
Older furnaces typically have AFUE ratings between 56% and 70%, meaning they waste 30 to 44 percent of the fuel they consume. The current federal minimum for new gas furnaces is 80% AFUE, but we recommend 90% AFUE or higher for the best balance of performance and savings.
High-efficiency condensing furnaces (90 to 98% AFUE) extract so much heat that the exhaust gases condense into water, which is safely drained away. These systems cost more upfront but typically save homeowners $300 to $500 per year in fuel costs, paying for themselves within five to seven years.