AFUE stands for Annual Fuel Utilization Efficiency. It is a measure of a furnace’s or boiler’s efficiency in converting fuel to energy over a typical year. Specifically, it measures the amount of fuel that is converted to heat compared to the amount lost up the chimney. AFUE is expressed as a percentage, with higher values indicating more efficient use of the fuel. For example, a furnace with an AFUE of 90% converts 90% of the fuel to heat, while 10% is lost.