The short answer

The cost answer depends on three variables, not one. Insulation quality decides how many kWh the home actually needs. Technology decides how efficiently the chosen fuel delivers heat (a heat pump turns one kWh into two to four kWh of heating; a gas furnace converts about 90% of the gas it burns to heat). The BC Hydro stepped rate decides how much the marginal electric kWh costs. Change any of those three and the winner of the cost question changes.

Variable 1
Insulation

A leaky home needs much more heat than a tight one. The fuel costs less to the household with the tight envelope because the home uses less of it.

Variable 2
Technology (COP)

Heat pump > baseboards. Modern gas furnace > older gas furnace. The technology decides how much heat each fuel unit produces.

Variable 3
Stepped rate exposure

A home that pushes deep into Step 2 every winter pays more per electric kWh than a home that stays in Step 1.

The non-obvious thing: the comparison most often quoted (gas vs electric baseboards in a leaky home) is the worst case for electricity, because baseboards are the lowest-efficiency electric technology and the leaky home pushes consumption deep into Step 2. Swap the technology to a heat pump and the same home flips the answer in many cases.

Who wins by scenario

Scenario Electric tech Gas tech Usually cheaper to run
Poorly insulated 1970s home, Vancouver IslandBaseboardsMid-efficiency gas furnaceGas
Same home with cold-climate heat pumpHeat pumpMid-efficiency gas furnaceClose to even; heat pump may edge ahead
Well-insulated 2010s home, VancouverHeat pumpHigh-efficiency gas furnaceElectric (heat pump)
Apartment, Vancouver, gas hot waterBaseboards (gas hot water)Wall furnaceGas (for water heating)
New build, Net Zero target, KelownaHeat pump + electric hot waterNot applicableElectric

Indicative scenarios. The actual answer for a specific home depends on a heat-loss calculation, current gas commodity prices, and the household\'s consumption pattern.

The non-obvious thing: the debate keeps moving, but in one direction

Over a decade, three things have moved the comparison toward electric. First, cold-climate heat pumps have become standard, which dramatically improves the efficiency of electric heating. Second, the BC carbon tax on natural gas has been rising every year, narrowing the per-kWh-equivalent gap. Third, CleanBC fuel-switching rebates have lowered the upfront cost of switching, making the long-run operating savings easier to capture.

Over the same decade, the BC Hydro stepped rate has remained the structural defence of gas heat: as long as Step 2 is meaningfully more expensive than Step 1, a poorly-insulated all-electric home pays a premium that a gas-heated home does not. That is why the fuel-switching rebate is paired with rebates for insulation and air sealing; the policy goal is to move the home out of the leaky-and-electric scenario where gas would win, into the tight-and-electric scenario where electric wins cleanly.

For a household today, the practical takeaway is that the answer is not "gas, full stop" or "electric, full stop". It is "what is the right combination of envelope improvements, technology, and rate option for this home". Most households who run that calculation end up with a heat pump and the rebate stack that funds it.

Action plan

How to actually answer the question for your home

  1. 01
    Pull your last 12 months of bills.

    BC Hydro on MyHydro, FortisBC on Account Online. The actual kWh and gigajoule consumption for your home, not the generic average, is what decides which fuel costs more in your case.

  2. 02
    Book a pre-retrofit EnerGuide evaluation.

    The evaluation models how much energy your specific home would use under different heating setups (baseboards, heat pump, gas furnace, dual fuel). The output is the only quantitative answer to the cost question for your address.

  3. 03
    Compare the three scenarios honestly.

    Stay on current gas system. Switch to heat pump with rebates. Hybrid (heat pump + gas backup). The evaluation report ranks them. Look at year-1 cost, year-5 cost, and year-15 cost; the long-run picture often differs from the year-1 picture.

  4. 04
    Run the rebate-stacking calculation.

    For a fuel-switching project, CleanBC Better Homes funds the conversion, BC Hydro funds the equipment, and the income-qualified stream (if eligible) significantly raises both. Read the stacking guide.

  5. 05
    Decide on time horizon.

    If you plan to sell the home within five years, the upfront cost recovery matters most. If you plan to stay 10+ years, the operating-cost trajectory dominates. Both are valid framings; pick yours before talking to contractors.

Frequently asked questions

It depends on three things: the home's insulation, the technology used (baseboards vs heat pump vs gas furnace), and where on the BC Hydro stepped rate the consumption lands. For poorly-insulated homes on baseboards, gas is usually cheaper to run. For a heat pump in a well-insulated home, electric is competitive or cheaper. The honest answer is: there is no single answer.
In a like-for-like comparison (gas furnace vs electric baseboards), gas commodity prices on a per-equivalent-kWh basis are usually below the BC Hydro Step 2 rate, especially in parts of Vancouver Island where the home is poorly insulated. The marketing is correct under that comparison; it just is not the only comparison that matters.
Two things. First, a heat pump delivers two to four units of heat per unit of electricity, which makes electric heat much more competitive. Second, the BC Hydro stepped rate makes the marginal cost of the last kWh more expensive than the average, which pushes well-insulated homes (where the last kWh is rare) toward electric and poorly-insulated homes toward gas.
BC has a long-running provincial carbon tax that applies to natural gas. The carbon component on a FortisBC bill is real and growing year by year. It does not flip the cost answer for most homes today, but it does narrow the gap, and the rebate framework is built around the assumption that electrification will outpace gas heating over the long run.
BC Hydro's grid is over 90% hydroelectric, so electric heat in BC has very low operating emissions. A gas furnace emits CO2 every hour it runs. The emissions answer is unambiguous in BC: electric is much cleaner. Whether that matters to a particular household is a separate question from the bill.
Only if the maths works for your specific home. The CleanBC fuel-switching rebate exists to bridge the upfront cost. Get an energy advisor evaluation, look at the long-run forecast for gas commodity prices vs electricity rates in your area, and remember that a heat pump also provides summer cooling, which the gas furnace does not.