AFUE
Annual fuel utilization efficiency — the percentage of a furnace's fuel that actually becomes heat for your home.
AFUE (annual fuel utilization efficiency) is the standard efficiency rating for furnaces and boilers, and the Federal Trade Commission requires every new unit to display it. It's the ratio of useful heat delivered to the fuel burned over a typical year: an AFUE of 90% means 90% of the fuel's energy becomes heat and the other 10% escapes up the flue. Older systems run 56–70%; modern condensing units reach as high as 98.5%, and 90%+ models earn the ENERGY STAR label. Higher AFUE costs more upfront but lowers your gas bill — the U.S. Department of Energy estimates that upgrading from 56% to 90% can roughly halve fuel use in a cold climate. When you cross from an 80% to a 90%+ furnace, the unit becomes 'condensing' and vents through PVC rather than the old chimney, which changes the installation. See the full breakdown in our guide to [furnace replacement cost](/guides/furnace-replacement-cost).