I Just Converted from Oil to Natural Gas

//I Just Converted from Oil to Natural Gas

I Just Converted from Oil to Natural Gas

A few months back I calculated how much money I would save from switching from oil to natural gas to heat my home.  I came up with the following calculations:

First thing I did was contact my oil company to get an idea of how much oil I used in a year.  That number was about 1,000 gallons.  My contract price for the year was \$3.59.  As such, I paid approximately \$3,590 in oil costs for the year!

Next I called the gas company to find out if I am burning 1,000 gallons of oil how much therm will I use of gas.  They told me the conversion was a factor of 1.18.  So it is estimated that I will use 1,180 gas measured in therms.  Next we have to multiple that for the cost of my gas which the natural gas company told me would be about \$1.30/therm.  This leads me to a total yearly cost of \$1,534! WOW.

My final costs were:

• \$3,075 for labor
• \$2,014 for the new burner (but I receive an \$865 visa gift card which I will dutifully apply to my now increased gas bill)

So total net cost of converting from oil to natural gas to heat my home was: \$4,224.  Since I will be saving \$1,534 a year in costs I will recap my costs from converting in a bit over 2 and a half years!  That is a win.

There are two outstanding issues which may affect the actual crossover period:

• The savings may even be greater if my brand new burner (but a lower type model) operates more efficiently than the 18 year old one (but better quality) being replaced.
• I now have a hole where the oil came into the house.  I have used expanding foam to cover it up but I just found out that is not a long term solution.  Zero clue how much this is going to cost to fix.

I was shocked how the costs varied between licensed and insured plumbers!  The numbers ranged from \$5K to \$11K for the same work.  I wouldn’t normally take the lowest cost, but he came with a great recommendation from a co-worker.  Even if that hole costs me \$1,000 I am still way under the other quotes.

All in all while I am pretty pumped to get the oil tank out of my house and the loud old burner,  I am more excited to start saving some money!

By | 2014-07-29T11:34:11+00:00 July 29th, 2014|Personal Situation|6 Comments

Evan is the owner of My Journey to Millions which was started to track his journey from a broke debt ridden law school graduate to building a positive balance. Need more Evan? Follow him on Twitter, Contact him or get new posts directly to your email

1. Done by Forty July 30, 2014 at 12:54 am - Reply

\$3,500 a year for heating oil? Good god. Yeah, seems like a great decision to switch.

• Evan September 28, 2014 at 10:36 pm - Reply

Crazy, right? Maybe it was b/c last year was a ridiculous winter but I think it was just an inefficient system.

2. Lazy Man and Money July 30, 2014 at 9:05 am - Reply

My mother replaced oil with gas a couple of years ago. It’s odd to go in the basement, because the oil tank was there for my entire life.

Like you the math, especially in New England winters, for gas really paid off relatively quickly.

I have gas myself, but for some reason the house had an electric dryer. I paid to have that switched. It’s probably going to be 50/50 on whether that saves money. We’d have to dry a lot of laundry before it catches up with the plumbing bills. Still, it seems to be the kind of thing that will pay off in the long run, even if that long run is far away.

• Evan September 28, 2014 at 10:38 pm - Reply

Why pay to have it switched then? Are the units cheaper for gas?

3. Tawcan July 30, 2014 at 5:08 pm - Reply

Wow that’s a lot of money for oil! Definitely sounds like a good decision to switch. The fact that the system is now a lot less noisy will make the living environment much better.

• Evan September 28, 2014 at 10:38 pm - Reply

Absolutely! No more clicking