When The Wife and I bought our home almost a year ago we knew that one of the first projects we wanted to do was converting from oil heat to gas heat. I thought this project would be a few years out but after receiving my 2nd $400+ Bill in the month of December I knew it was about time to get some quotes.
Calculating How Much I was Going to Save When Switching From Oil to Gas Heat
I wanted to know exactly how long it was going to take me to make my money back on actually converting my home from oil heat to gas heat. 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.
So I figure I am going to save about $2,000/yr (see additional considerations below) by switching, so all I have to do is compare that to the cost of the actual conversion. Thus far I have received three quotes, $4,600, $6,800 and $9,400! Talk about wild swings, right? The $9,400 guy was a joke, he was clearly not a worker and was pure salesman. He added all sorts of charges on his estimates that I didn’t ask for; when questioned he basically saw that we were pricing the job out and bailed. So ignoring that guy we are looking at a cross over between 2 years and 3.5 years.
Other Factors to Consider When Converting from Oil to Gas
I thought of a few other factors (both good and bad) that should be considered when decided to convert:
- The gas company who wants me to convert so I am a customer could be underestimating my yearly cost. This is very possible.
- It just seems likely that oil will continue to get more expensive per gallon due to a political pressures and a dwindling supply (supposedly). Natural gas on the other hand seems to be dropping in price since apparently the U.S. is sitting on tons of it.
- I will be getting a new burner 83 to 85% efficient burner versus the 15 to 20 year old burner that is currently my basement, as such, the numbers actually could look better (maybe that’ll offset consideration number 1).
- I may have to have additional work done to the basement. For some reason my home has gas hot water and cooking but the piping used for that is smaller than what is needed for heat. Part of my ceiling is going to have to be removed and eventually replaced. This may leave a small portion of our drop down ceiling removed until we redo the basement which may be a year or so away.
We are in contract until February 18th anyway (with a $600 ETF) so nothing is going to be done then, but I would love to hear from people who have completed this type of project:
- Do my numbers seem correct?
- Are there any other considerations I should consider?