Making the switch from oil – the most expensive way to heat your home

Making the switch from oil – the most expensive way to heat your home

Oil is an expensive way to heat your house, and those who heat with oil should consider some other options for replacing this system. If you heat with oil, you are probably spending between $1000 and $2000 annually on oil to heat your home, and possibly more based on fluctuating crude prices.
To upgrade this system, three options generally include: a) keep maintaining the old furnace and replace it with a new oil furnace when it breaks; b) installing gas or c) install an inverter driven heat pump.

Option B could mean installing a high efficiency gas furnace that costs about $5k or a standard gas furnace that is 15% less efficient and costs about $3k.

Option C could mean installing a forced air or ductless heat pump. A forced air unit will be more expensive option ($8k) compared to $4k for the ductless unit. The forced air, however, will heat a larger area of the house than a ductless model. The ductless units are good for heating large open spaces like your living room/kitchen/entry area. Additional indoor units add $1.5k each to the initial $4k.

At current energy prices, a high efficiency gas furnace would cost half as much as an oil furnace and an inverter driven heat pump would cost about a third as much as an oil furnace.

Here are some other things to consider if you are on the fence about switching from oil:

Upfront v. Operating Costs. While the upfront costs of some of these options are significantly higher than others, the added efficiency of these more expensive heaters will pay for themselves over time.

Environment. The gas and oil furnace is a fossil fuel and the heat pump could run on renewable energy sources.

Price Security. Natural gas and oil furnaces would lock you into one fuel type; a heat pump could be powered by many different fuel types depending on what the utility chooses to generate.

Base Service Charges. Seattle City Light’s monthly base service charge is $3.30 and Puget Sound Energy’s is $10. Going with gas would cost you an additional $120/yr.

Contract. PSE’s deal to help cover the cost of bringing gas to your house may require you to change over your water heater and stove to gas. You may not be planning on replacing these other two appliances and doing so may cost a lot of money. Cooking does not account for a large amount of energy use, and an electric stove is about twice as efficient as a gas stove. If you want a gas stove for the better cooking experience, consider an induction stove top which is the not only the most efficient but also the top performing cooking appliance (yep, even better than gas). An induction stove top is, however, very expensive ~$2k. Cooking with gas releases more pollutants in the house and it would be best to have a better functioning kitchen exhaust fan in that scenario. A gas water heater is also less efficient than a heat pump water heater but may be less costly to operate than an existing electric water heater.

Safety & Liability. Bringing gas into the home or keeping oil presents risks for carbon monoxide poisoning and gas/oil leaks.

Air Conditioning. The heat pump can operate in reverse and provide cooling in the summer time.

Maintenance. Both the gas/oil furnace and heat pump will require a similar level of regular maintenance. A ductless heat pump requires the least amount of maintenance.

Noise. The heat pump’s outdoor unit, while quieter than traditional air conditioners, will be noisier than a gas furnace.

Comfort. Inverter driven heat pumps can modulate their fans and heaters to perfectly match the heating demands of the house. This is in contrast to your oil furnace that is either on or off, which results in wide temperature swings in the house. High efficiency gas furnaces can modulate too but they are more expensive than standard models.

Ducts. Gas and oil require you to keep your ductwork. A ductless heat pump would allow you to remove all the ductwork in the basement and reclaim some headroom and space including the closet the furnace is currently in.

Local Heating. One benefit to the ductless system is that you can locally heat one part of the house instead of heating the entire house with a forced air system. Locally heating is more efficient than heating the entire house.

Resale Value. Many homeowners do not want to buy homes that have oil heat.

Rebates. Gas and electric utilities, such as Puget Sound Energy and Seattle City Light, often offer rebates for insulation to help keep the heat inside your home. If you convert to electricity or gas, you may become eligible for additional incentives to weatherize your home.

Insulate & Air Seal. Oftentimes it makes more financial sense to improve the insulation and air seal your home so that your costly oil furnace runs less often. A house that needs less heat also requires a smaller furnace so you can save money by buying a smaller heater if you have already done work to keep heat inside the house.

A switch from oil provides tremendous positive opportunities for homeowners. Saving money is just one of them.

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Community Power Works is a Seattle neighborhood-based building retrofit program that will achieve deep energy savings and create green jobs.