How much does it cost to convert from oil to natural gas heat?
Converting from oil to natural gas typically costs $6,000–$20,000 nationally, per HomeGuide: $6,000–$12,000 when a gas line already reaches the house and $12,000–$20,000 when one has to be run. The service line, chimney liner, oil tank removal and a new way to heat water decide where you land.
Key points
- Call your gas utility first. Whether gas can reach the house, and when, decides the whole project.
- Replace like with like: an oil furnace becomes a gas furnace, an oil boiler usually becomes a gas boiler.
- Watch for the hidden job: many oil boilers also make the house's hot water, so you'll need a new way to heat water.
- HomeGuide's typical national range is $6,000–$20,000 for the full conversion; the gas line and chimney are the big swing items.
- The federal 25C credit ended for equipment installed after December 31, 2025, so budget without it.
Converting an oil-heated house to natural gas typically costs $6,000–$20,000, according to HomeGuide's national cost guide: $6,000–$12,000 when a gas line already reaches the house, and $12,000–$20,000 when one has to be run. The new furnace or boiler is only part of that number. The gas service, the chimney, the oil tank and how the house will make hot water once the oil burner is gone decide where your project lands.
Oil heat is uncommon in Minnesota, but it still turns up in older farmhouses, rural homes and the occasional house in town that never switched. Most of the surprises in a conversion come from the parts around the furnace, so this is the order we'd work through it.
How do you find out if natural gas can reach your house?
Call your gas utility before you call anyone else. Depending on your address that's CenterPoint Energy, Xcel Energy, Minnesota Energy Resources or another utility. Ask three things:
- Is there a gas main on your road, and how far is it from the house?
- What does a new service line and meter cost you, and what's their timeline?
- Do they have a conversion program? Xcel Energy, for example, lists a "Make the Switch to Natural Gas" program on its Minnesota heating and cooling pages.
The utility generally runs the line from the main to the meter. Everything on the house side of the meter, meaning the piping to the furnace, water heater, range or dryer, is the contractor's job and needs a permit. Our post on gas line installation for new HVAC systems covers that side.
If there's no gas main within reach, stop here and look at propane or a heat pump instead. Our propane heating cost guide walks through that math.
Should you convert to a gas furnace or a gas boiler?
Look at how the house is heated now:
- Oil furnace with ductwork: the usual answer is a condensing gas furnace on the existing ducts. We check the ducts and return air before sizing, because old oil-era duct systems are often undersized for modern blowers and for central air.
- Oil boiler with radiators or baseboard: the usual answer is a gas boiler. The radiators and piping stay. Tearing out a working hot-water system to add ducts only makes sense if you also want central air, and even then a ductless system may be the better fit. Our boiler vs furnace guide goes through that decision, and our boiler and radiant heat service covers what we do on hot-water systems.
Either way, a replacement should be sized from a Manual J load calculation. Oil equipment in old houses is often far bigger than the house needs, and copying its size onto a gas furnace wastes money and comfort.
The chimney and the hot water: the two gotchas
Venting. Oil equipment vents up a masonry chimney. A condensing gas furnace or boiler vents through PVC out a side wall or the roof, so the chimney may end up unused. If a gas water heater will keep venting into that chimney on its own, the chimney usually needs a liner sized for it. The same venting question drives a lot of furnace jobs in older city houses, as our page on furnace replacement in Minneapolis explains.
Hot water. This one catches people. Many oil boilers heat the house's domestic hot water too, either with a coil inside the boiler or a tank connected to it. Some oil homes have an oil-fired water heater. Pull the oil system out and you need a new way to make hot water on the same day, so plan for it in the quote. Our tank vs tankless water heater guide lays out the options. In a boiler house with modest hot water use, a combination boiler such as a Navien combi boiler heats both the radiators and the tap water from one gas appliance.
What happens to the oil tank in a gas conversion?
A basement tank is the easy case: it gets pumped out, disconnected and removed, and the fill and vent pipes on the outside wall get capped or removed. Get it in writing who is doing this and who takes the leftover oil.
A buried tank is different. Before anyone digs, check your city's rules and ask the Minnesota Pollution Control Agency what applies to a residential heating oil tank. If there's any sign the tank has leaked, that becomes a separate cleanup process with its own rules. Deal with the tank on purpose rather than leaving it in the yard for the next owner to discover.
What it costs, and the fuel math
These are typical national ranges from HomeGuide's 2026 oil-to-gas conversion guide, not our prices:
| Situation | Typical national range (HomeGuide) |
|---|---|
| Gas line already at the house | $6,000–$12,000 |
| Needs a new gas line | $12,000–$20,000 |
| Large or complex homes | $15,000–$22,000 or more |
| Chimney liner, if needed | $1,500–$4,000 or more |
The furnace itself falls in our published range: $4,500–$9,500 installed for a furnace replacement, with 96–98% models roughly $6,500–$9,500. Tank removal, gas piping, water heating and the utility's charges sit on top of that. Our furnace replacement cost guide breaks down what moves the furnace part of the number.
For running costs, compare what you pay per unit of heat that actually reaches the house. Per the U.S. Energy Information Administration, a gallon of heating oil holds about 138,500 BTU and a therm of natural gas is 100,000 BTU. So to put 1 million BTU of heat into the house:
| Equipment | Fuel you buy |
|---|---|
| Oil furnace or boiler at 80% | about 9.0 gallons of oil |
| Oil furnace or boiler at 85% | about 8.5 gallons of oil |
| Gas furnace at 95% | about 10.5 therms |
| Gas furnace at 97% | about 10.3 therms |
Multiply each by your current price per gallon or your all-in cost per therm from the gas bill, and you have a fair comparison.
A conversion, start to finish
The appliance swap itself is short. The project runs longer because several parties have to line up, roughly in this order:
- The utility. Confirm gas service, the service-line cost and when the meter can be set.
- A load calculation and a written quote. Sizing comes from a Manual J. Venting, the gas connection, hot water and the oil tank should each be a line on the quote, with who is responsible for each.
- Permits. A furnace or boiler replacement normally needs a mechanical permit from the city, or from the county or state where the city has no building department. Gas piping and a new water heater can need their own.
- The meter. The utility runs the service line and sets the meter.
- Install day. The oil equipment comes out, the new furnace or boiler goes in with its venting and gas connection, and it's started up and checked for clean combustion and safe venting.
- Hot water. Back on the same day, by whichever route you chose.
- The tank. Pumped out and removed, with the outside fill and vent pipes capped or removed.
- Inspection. The permit gets its final inspection.
Keep enough oil in the tank to heat the house until the gas appliance runs. A tank run nearly dry can pull sludge into the filter and nozzle, and a no-heat call on a burner you're about to remove is wasted money.
Minnesota timing and safety
Plan a conversion for summer or early fall. New service lines are easiest to schedule before the ground freezes, and a basement full of disconnected oil piping in January means a cold house. If the oil furnace or boiler fails in midwinter before gas is available, a repair to get through the season usually beats a rushed conversion.
A new gas appliance is also the time to check your carbon monoxide alarms. Minnesota law requires a working CO alarm within 10 feet of every sleeping room, and our guide to CO detector placement shows where they go.
Are there rebates for converting from oil to gas heat?
Utility rebates can take some of the sting out. CenterPoint Energy's heating system rebates cover high-efficiency furnaces and boilers, let you use the heating dealer of your choice, and need the application filed in the same calendar year as the install. A proposal or estimate doesn't count as proof of purchase. Xcel Energy lists gas furnace rebates too, some through participating contractors. Our CenterPoint rebate guide has the details and links.
What's gone: the federal 25C tax credit ended for equipment placed in service after December 31, 2025. Minnesota's federally funded home energy rebates (HEAR and HOMES) had not launched as of mid-2026. Don't build either into your budget.
What to do next
Get the utility's answer on service first, then have the house looked at. We'll size the new furnace or boiler with a Manual J, check the ducts or piping, and give you a written, flat-rate price that states what's included, so the venting, gas piping and hot water questions are settled before work starts. Call 612-429-3465, any day 7am–9pm, or start with our furnace replacement page. If the old oil system quits before you're ready, our $79 trip charge is waived when you approve the repair.
Questions
Can I keep my oil furnace and just change the burner to gas?
Gas conversion burners made to fit oil equipment do exist. On an old oil furnace or cast-iron boiler we'd rarely recommend one: you keep an old heat exchanger and an 80%-class appliance, and you still need proper venting. In most Minnesota conversions a new condensing gas furnace or boiler is the better use of the money.
How long does an oil-to-gas conversion take?
The furnace or boiler swap itself is usually a day or two. The calendar is set by everything around it: the gas utility scheduling the service line and meter, permits, and removing the oil tank. Frozen ground can push new service line work later, so if you're planning a conversion, start the utility conversation in summer or early fall.
What if natural gas isn't available on my road?
Then the choice is usually propane, a heat pump, or both. A propane furnace works like a gas furnace with a tank in the yard. A cold-climate heat pump paired with a propane or electric backup can cut the fuel you buy. Our propane and heat pump guides compare the options for rural Minnesota homes.
Can I still get federal money for switching from oil to gas?
Not from a tax break. The federal 25C tax credit ended after December 31, 2025, so equipment placed in service in 2026 doesn't qualify. Minnesota's federally funded home energy rebates have not launched. Utility rebates on high-efficiency gas furnaces and boilers are still offered by CenterPoint Energy and Xcel Energy, with terms that change every year.
Sources
- HomeGuide cost guides (2026 editions) homeguide.com