A modulating furnace operates by continuously adjusting the heat output in response to the precise heating needs of the home. It uses a variable gas valve and a modulating blower motor to provide a range of heat output levels. Unlike two-stage furnaces that have only two heat output settings, modulating furnaces can finely tune their heat output in real-time, ensuring that the indoor temperature remains extremely stable and closely matches the thermostat's set point. This precise control results in superior comfort, minimal temperature fluctuations, and maximum energy efficiency, as the furnace only generates the amount of heat required to maintain the desired temperature, avoiding the frequent cycling on and off seen in single-stage or two-stage furnaces. Modulating furnaces are especially effective in maintaining even temperatures, improving indoor air quality, and reducing energy consumption, making them a top choice for homeowners seeking optimal heating performance and comfort.