Propane vs. Natural Gas Heating in Rural Simcoe County and Muskoka
Written by the Northland Home Comfort team — TSSA-registered heating, cooling and hydronics contractor (FS-R-50021) serving Simcoe County and Muskoka. Updated October 2026.
Short answer: Natural gas is the cheapest way to heat a home in Ontario, but it is only available in towns and along a limited number of rural lines in Simcoe County and almost none of Muskoka. Most rural homes and cottages heat with propane, which costs roughly two to three times as much per unit of heat as natural gas, depending on your contract and delivery. The equipment is the same; the fuel is the difference. For propane homes, a cold-climate heat pump paired with the propane furnace or boiler is the single biggest bill reducer available in 2026, and it qualifies for the Ontario rebate.
Is natural gas available where I live?
Enbridge serves Orillia, Barrie, Midland, Penetanguishene, Coldwater, Gravenhurst, Bracebridge and the larger villages, plus some rural roads near them. Beyond that, the answer is usually no, and extension costs for a single home are rarely worth it. Check with Enbridge for your address; we will also tell you what we see on your road.
What propane costs to heat with
Propane is priced per litre and delivered to a tank at the house. Prices move with the market and with your contract; budget plans and fixed-price contracts smooth it out. Per unit of heat, propane in Ontario has typically cost two to three times natural gas. For a 2,000 sq ft home that is the difference between roughly $1,200 and $3,000 a winter at the same furnace efficiency, so efficiency and the heat pump option matter more on propane than on gas.
Tanks, contracts and the regulator
- Tank size: 420 lb cylinders for small loads; 500 or 1,000 gallon tanks for homes. Rented from the supplier in most cases.
- Placement is governed by clearances to the house, property lines, ignition sources and the driveway for the delivery truck. We coordinate the tank location with the supplier before the install so the gas line run and regulator are right.
- Regulator and line sizing are sized to the total load: furnace or boiler, water heater, range, fireplace, generator. Adding a tankless water heater or a generator later often means re-sizing.
Equipment: the same, with a conversion
Gas furnaces, boilers and water heaters are built for natural gas and converted to propane with a factory kit (different orifices and pressure settings). Cost: $150 to $400 on a furnace. Everything else — venting, efficiency, warranty — is the same. See furnace costs.
The three ways to cut a propane bill
- Highest-efficiency equipment. On propane, the step from an 80 percent furnace to a 96 percent furnace saves real money every winter.
- Add a cold-climate heat pump. The heat pump heats down to about -12°C to -15°C at a cost well below propane; the furnace covers the rest. On a typical propane home it cuts propane use by half or more. Up to $7,500 back from Home Renovation Savings. See heat pump costs.
- Fix the house. Air sealing and attic insulation reduce the load for either fuel and also qualify for rebates.
Electric heat and all-electric homes
Electric baseboard is the simplest and the most expensive to run. For small, tight cottages, an all-electric cold-climate heat pump system with electric backup is often cheaper to install and run than putting in propane. For larger homes, propane plus a heat pump is usually the better balance. We run the numbers both ways in the quote.
Oil
Oil furnaces are still out there in older rural homes. The federal Oil to Heat Pump Affordability program closed to new applicants in July 2026, but an oil-to-propane conversion with a cold-climate heat pump is a common project for us in Muskoka: new furnace, propane supply, heat pump, tank removal. See our furnace page for propane conversions.
Frequently asked questions
Yes. Per unit of heat, propane has typically cost two to three times as much as natural gas in Ontario, depending on contracts and delivery. The equipment is the same; the fuel price is the difference.
Yes, with a manufacturer conversion kit installed by a licensed gas technician. The furnace, venting and efficiency are otherwise identical.
A cold-climate heat pump, with propane or electric backup for the coldest days. It delivers two to three units of heat per unit of electricity and cuts propane use by half or more in a typical rural home.
Most homes use a 500-gallon tank; large homes, homes with generators or snow melt use 1,000 gallons. The supplier sizes the tank to your annual use and delivery schedule; we size the regulator and line to the connected load.
Propane installations fall under the same TSSA requirements as natural gas and must be done by a licensed gas technician. Our quotes include the permit and inspection.
Rural home or cottage on propane or electric heat? Ask us to price the heat pump option beside a straight replacement.
