I am in E TN. I have had two heat pumps and a propane furnace in homes here. Propane is by the far the most expensive way to heat, costing on the order of two to three times as much as a heat pump.

Propane prices are regional. For some reason, they seem to be high in E TN. Electricity runs from low to medium, depending on whose system you are on. Unlike some parts of the country, E TN is carved up into small utility boards or districts with disparate pricing.

Today's heat pumps produce useful heat down to or close to zero degrees. They just don't produce as much of it as the outside temperature falls. For that reason, heat pumps are equipped with either backup resistance heat (heat strips) or the ability to switch over to an alternate fuel (usually natural gas or propane).

Heat strips cost more to operate, but can be staged and used concurrently with the heat pump, moderating their expense. Gas backup (called dual fuel) is an either or situation.

Heat pumps are normally sized for cooling, in order for them to run efficiently and dehumidify the air properly. In E TN that generally means that don't have enough output by themselves to heat the home on a very cold day, resulting in the heat strips coming on or the unit switching to gas.

However, the new two stage heat pumps can be sized for heating, since they have the ability to loaf along on stage one for normal cooling loads. Coupled with a variable speed air handler, they provide superior heating, cooling, and humidity control, They are perfect for this area.

I suggest you look into a two stage heat pump with a variable speed air handler with an on demand dehumidification feature. Look for a brand with a significant difference between high and low stages. Couple that with a smart thermostat with an integrated humidistat, such as the Honeywell Vision Pro IAQ and you have a sytem that will provide superior comfort. FWIW, we have a Rheem system and are very, very happy with it.

Heat strips cost more to operate, but can be staged and used concurrently with the heat pump, moderating their expense.

By the above, I mean heat strips cost more to operate than the heat pump (unless it is extremely cold out). They may cost more or less than propane, depending on current prices.

Your heatpump will be able to heat the home by itself down to 20 degrees. The auxiliary heat will ASSIST when the heatpump isn't generating enough heat to maintain the temperature. When I mean assist it will still run but your auxiliary will help out a bit.

In my house which isn't as well insulated as yours my heatpump runs about 50-55 minutes of the hour when its 25 degrees fanrenheit to maintain 67.

To be honest in colder temperature like around 25 and below the heatpump heat feels a bit cool. This shouldn't be much of a problem since your house will be new and better insulated. This occurence will probably happen if under 20 degrees outside. How often is that though?

The heatpump units these days really are efficient. With low electricity prices in your area I would definetly get a heatpump over any other type of heat. Your winters aren't that brutal. Yes you will get some really cold weather but its for a relatively small time of the year.

Make sure it has demand-defrost and about 15 seer or above.

Your heatpump will be able to heat the home by itself down to 20 degrees.

This really depends on the heat pump size versus the heating load the house presents. It also depends on what the heating design temperature is. There is no hard number.

We moved into our new home in mid February. It's a passive solar home, so sunny days don't count in regards to the heat pump. However, when we relied on the heat pump alone on sunless days, the heat strips never came on. I have them locked out above 5 degrees. We heat to 65 to 68 degrees, depending on our mood.

Like the OP, we have a ranch with a walkout basement. The basement helps moderate both the cooling and heating requirements.

We have a 4 ton two stage heat pump for a little over 2,000 sf on both the main and basement levels.

I agree with Creek_side says. You can heat with a heat pump down to a very low temperature.

I was giving as example of 20 degrees based on average building characterics. If you have a newer home that is very tight you can heat down to lower temperatures. Its all based on heat loss of the home and the btu the new heat pump puts out.

And, technically, a heat pump is a forced-air furnace.

And, technically, a heat pump is a forced-air furnace.

Technically, a heat pump is a device that moves heat energy from one location to another by mechanical means. That doesn't make it a furnace.

You can buy a "heat pump" that heats only water.

You can buy a "heat pump" that will keep your beer cold.

You can buy a "heat pump" that will cool your house down and not heat it.

As used in the HVAC industry, the term heat pump used broadly means an air conditioner that can run backwards to also heat the house when needed. In a more narrow sense, it refers just to an AC condensing unit that also heats.