electric vs oil costs

kurtgJune 27, 2008

I hope someone can confirm I am on the right track with some cost comparisons.

Electricity is costing us 14.3 cents/Kw (after taxes and all thanks to MD deregulation and 118% price increase)

New oil contract due sets $5.69 cap- yikes! if I sign.

We have a heat pump with oil furnace and some other supp electric heat (baseboard and oil filled space heaters that were not used).

At $5.69/gallon and assumig 70% efficiency for oil furnace,138,690 btu/gallon, 3,411 btu/Kw, I get 19.9 cents/Kw or 17,000 btu per $1 for oil. For electric, I know the rate is 14.3 cents/Kw or ~ 23,850 btu/$1.

It looks like heating oil would have to drop to ~$4.10 to be comparable to our electric rates and heat pump ought to be more efficient than just straight electric.

I don't have the oil #s in front of me, but seems like we might have used 60 gallon/month during heating months. We ran oil more as it was warmer faster and seemed to run less, but might try going all electric this year given the high price of crude and heating oil. If my numbers are close I'm not inclined to sign a contract and service agreement based on past usage, but pay the spot price if needed and only run it when it is like 20F or below. We have a thermo switch that would kick the oil on at a set outsied temp. At $2.49/gallon, we overode the heatpump last year (set at 40F) and ran oil almost exclusively, but it looks to be expensive to do so this year if the #s I found aren't garbage.

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Yes, your numbers are right, and you are, as you know, taking electric at the straight resistance rate, not even allowing for the efficiency of the heat pump -- a good, conservative approach -- but the heat pump will in reality be at least twice as efficient as resistance.

So there's no weather where the oil is going to be cheaper at $5.69/gallon. Your only challenge will be to make sure you don't start tripping breakers with all of those plug-in heaters. In your situation, I might want to see if it would be feasible in your furnace to put in some electric strip heaters for your backup heat rather than using the oil furnace. Then you wouldn't have to buy a drop of oil. Alternatively, you could put in some electric baseboard heaters (on dedicated circuits).

    Bookmark   June 27, 2008 at 4:11PM
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I like to use the attached fuel comparison calculator to get a good guide for various fuel type costs.

Punch your numbers in. For COP on new high eff heat pump systems, I suggest 2.75 which is a conservative number. The results are a real eyeopener and as ky said, electric resistant baseboard heat is less expensive than oil.

see calculator.
The question of dropping oil and going straight high eff HP system is really a no-brainer.

I would even check with your electric utility and see if they offer any rate incentive for straight HP heating.


Here is a link that might be useful: Warm Air Fuel Comparison Calculator

    Bookmark   June 27, 2008 at 5:15PM
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I liked the link too. Definately not doing oil this winter. We will try to max out the heat pump and use the baseboard as needed.

Should have no problems with the circuits. We have a pretty heavy service and the prior owners installed the current heat pump after the baseboard downstairs (no prior ducting). I just disconnected it when our inlaws were living with us as they kept putting flammables near the heaters and had the thermostats on all the time even with the heatpump/oil running. I didn't run the baseboard at all last winter (they moved out now) and the temps were fine.

    Bookmark   June 30, 2008 at 9:30AM
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I would agree with your conclusions. The only thing I would add is a typical oil burner runs around 80%. So unless you have an old junker I would use 80% when comparing.

    Bookmark   June 30, 2008 at 11:30AM
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