My Utility Company told me my 40 year old furnace is 80% efficient. What does this mean?

The only efficiency test that can be done in your home is called a steady state test. This has only to do with how efficiently your furnace burns the gas. It doesn’t take into consideration that most of the heat generated is going out the chimney. Heating equipment of this age was built before there was an AFUE test and actually is about 60% efficient.