Comparative Costs of Gas vs. Electric vs. Oil

Ashworth -- HVAC Costs -- 05-02-16

Unless you live in select pockets of the US and are cutting and stacking your own cordage for the winter, there are three main ways to heat your home: gas, electricity and oil. Each of them are prone to price swings depending on market factors, load usage, production, and a whole host of other issues. In order to provide as concise and informative article as possible we’re going to be dealing in averages. Average costs. Average-sized homes. Average efficiencies. Average usage. It’s not perfect – but it will reflect a ballpark idea of the costs and help you to better decide on a heating method.

Utility Pricing

Gas – $1.10/100,000 BTU

Electric – $2.93/100,000 BTU

Oil – $2.50/100,000 BTU

Given an average-sized house with standard levels of insulation, in an area of the US that experiences cold, but not harsh, winters takes 60,000,000 BTUs of energy per year to heat, the costs are as follows:

Gas – $733

The usual starting point for efficiencies in gas furnaces is 90% and will rise from there to about 97%. For the figure given here we used a 90% efficiency rating.

Electricity – $703 – $1,758

The wildly variable operating cost here is due to the well, wildly variable efficiencies of electric heating depending on method. There’s electric-resistance heating (Think of your toaster), and heat pumps. (If your “air conditioning” unit also has a heating function – you have a heat pump and didn’t even know it.)

Electric resistance heating is rather inefficient at 100% when compared to heat pumps which range from 100%-300% depending on configuration. The above rage is for ductless heat pumps on the low end, to 100% efficient electric-resistance heating on the high end.

Oil – $1,875

Oil heating is not a terribly efficient method of home heating, hence the higher costs. Also, it’s oil. It’s not called black gold without reason. (Not technically the same product, but home heating oil is derived from petroleum.) Older models can operate at a dismal 70% efficiency but some newer ones will top out around 85%. For this figure we used an 80% efficiency rating.

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