A frequent question we get from our home inspection clients is how much their heating and cooling costs might be. Answering this question falls outside the scope of our job description, so we refrain from answering it directly, but this article will cover the basics to assist anyone trying to figure out what they can expect to pay for various types of fuel sources in their current or future home.
In the current era, renewable sources of energy (solar, wind, etc) are becoming more and more popular, but non-renewable sources are still much more prevalent – at least here in the Northeast. When I refer to “fuel sources,” I mean energy sources that can power systems, and heat is a particular focus since a heat source is required for a home to be safely habitable. You’re probably familiar with at least several of the most common fuel sources, but there are some that are common in areas that you may not even know exist. Let’s take a minute to go over some…
ELECTRICITY. If you aren’t Amish or living entirely off-grid, you’re well acquainted with electricity. It powers your lights, TVs, computers, many appliances and more, and it can serve as an energy source for your home’s entire heating system. A fully electric heating system utilizes electric baseboard heaters, an electric heat pump or boiler, in-floor and/or in-ceiling electric heat, and this type of system is very efficient since all wattage is actually used to generate heat. However, all-electric heat can be quite expensive, the systems can be prone to partial or full outages, and baseboard heaters can pose a hazard when drapes, cords or other items exist above or very close to them as they become very hot. Standard heat pumps are great in the right climate but can become less practical in very cold climates where less heat is available to be drawn in from outdoor air. The exception to the often high cost of electric heating is perhaps the most efficient option of all, which is an electric geothermal (ground source) heat pump, which takes on and disperses heat via the ground where the temperature is more constant – even during winter and periods of very low temperatures. Large homes with a geothermal system often have total electric bills under $300 per month, which is incredible considering that this figure includes all devices and not just the cost of heating and cooling. Another benefit of every electric heating system is a steady supply of power (provided there are no outages), meaning no manual deliveries need to be made to the home. While quite expensive, whole-house gas powered generators can also be installed to provide “backup” power in the event that a power outage occurs.
NATURAL GAS. Generally speaking, if a costly geothermal system isn’t an option, natural gas is typically the least expensive option to fuel most homes. Although not available in some areas, many homes are equipped with a natural gas supply; and like electricity, it comes into the house on a continual basis without having to be delivered manually. A downside to gas is the possibility of potentially hazardous gas leaks, which can be very dangerous (even fatal), although proper installation and periodic inspections can prevent this issue. Not long ago, we discovered a concerning gas leak during an inspection at a duplex that had been inspected and deemed fine just two days prior, and the unit with the leak was tenant occupied. To the credit of the gas company, they immediately owned their mistake and promptly sent a crew out to correct the problem and ensure the occupant’s safety. Despite the hazards inherent with combustible gases, nearly all homes we inspect with natural gas are free of leaks with well installed systems and components, and the low cost and plentiful availability of natural gas make it a great option for most homes.
PROPANE. Like natural gas, liquid propane (LP) is also a gas. However, unlike natural gas that comes into homes in a steady supply, propane has to be delivered. This means the propane level has to be monitored fairly often (usually with a tank gauge or fin), and the service provider has to be alerted when refills are necessary. Propane is usually fairly cost-effective, but it is more costly than natural gas, often near-equivalent to electricity per kilowatt hour, and usually cheaper than fuel oil.
FUEL OIL. This is a type of fuel source that is very common in our area but not at all common in many regions of the country. Like propane, fuel oil has to be manually delivered to homes that utilize it, and the oil level needs to be monitored by the homeowner – typically with a simple gauge at the oil storage tank(s). These gauges occasionally become faulty, but even a long yard stick can be used as a “dip stick” to check the oil level, similar to checking the oil level in a vehicle. Fuel oil produces a very hot heat that many people like, but oil also produces a smell some find unpleasant and usually costs a good bit more than other fuel sources. Unlike electric and natural gas bills that are paid monthly, fuel oil deliveries have to be paid in full at the time of delivery, which makes budgeting more difficult, although service providers nearly always offer discounts for purchasing more gallons at a time (for example, $3.89 per gallon for 100 gallons, $3.69 per gallon up to 199 gallons, and 3.49 for 200 gallons or more). Discounts are also available by most companies during off-peak seasons, like summer, so money can be saved by planning and budgeting wisely.
COAL & WOOD. Although different, these fuel sources are “lumped” together (get it?) because both are solid fuel options and can sometimes both be used in the same furnace or boiler. In fact, even fuel oil can be used in some systems that accept wood and coal, although such systems are rather rare. The benefit to coal and wood is that both burn hot and are fairly inexpensive (especially wood that can be obtained on one’s own property or for little to no cost from a friend), but both are also quite dirty and require manual work to load the solid fuel, stoke the fire and clean the resulting debris. Some people who utilize wood and coal enjoy the labor involved and like harkening back to an older time, but this requires the know-how, skill and time necessary to keep up with this type of system. It goes without saying, but coal and wood require manual delivery, which some find inconvenient.
Regardless of the type of HVAC system you have or plan to install, know that a high-efficiency system will save you a lot of money over the long run. Look for high AFUE ratings (90% and higher) for heating systems and high SEER ratings for A/C systems to ensure more of your money is actually being used to heat or cool your home. Almost as important is utilizing a programmable thermostat – preferably a modern “SMART” model that can be controlled remotely and tracks data related to usage habits – but be sure to actually program and monitor the stat. When it comes to upgrades that improve energy efficiency and have a quick return on investment (ROI), programmable thermostats rank among the highest and are really a no-brainer.
In many cases, homeowners are limited in their fuel options based on what’s available in their area and cost considerations. Hopefully this article has served as a helpful and informative guide as you seek to utilize your resources as best as possible in your own home, and feel free to comment if you still have questions or need further assistance!
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