Money Spent = Money Saved?

Although it’s still cold and windy outside this week with unseasonably low temperatures, the warm weather is almost here and that means the end of the heating season. Last fall we replaced our 1987 oil burning furnace with a new 92%+ efficient gas burning furnace. Of course at the time I started collecting bids heating oil as nearing $5 a gallon and I was understandably concerned about the cost to run that oil burner al winter. Then the prices dropped. Well, oil prices fluctuate – or, they do now at least. I gave myself a conservative estimate on the return on the investment or 6 years back in September and well, we’re a little behind on that. The price of heating oil dropped back to $2.29 in February and that put a damper on my speedy ROI.

However, just because we’re not “saving” as much as I planned/hoped doesn’t mean that it wasn’t a good investment. We are saving money. In fact, our heating bill for the ‘08-’09 winter is around 50% of the estimated oil cost. And the price for natural gas is actually supposed to go down for next winter so maybe we’ll make up some of that momentum.

Estimated ’08-’09 cost of heating the house with oil: $896.35

Estimated ’08-‘09 final natural gas bill: $470.43

Dollars saved: $425.92!

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The house gets a little action

The new furnace was installed yesterday but I haven't gotten a look at it yet. I know that a large part of the cost of the furnace was the installation, but do you know how nice it is to come home and it's just done? Old one hauled away new one installed, hooked up to gas, electric and thermostat and they warranty their work so I don't have to worry too much about something being done wrong. I think I could like this whole "paying other people to do work for me" thing. Next up a plumber for the laundry!

I created a table to calculate the return on our investment of a new furnace. It's a little tricky to read because oil is purchased in batches and gas is paid per month so the percentage will shrink until the next hypothetical oil delivery then shoot back up. The most accurate numbers will be at the end of each heating season. Since we have and electric hot water tank it will be easy to see exactly how much fuel the furnace is consuming. I'll update it once a month after I pay the utility bill. Even though gas/oil prices have dropped since this summer, I still believe that we will make back our money on this thing. And bonus: no more stinky petroleum smell in the basement. Actually right now it's pretty bad because they had to cut open the tank to remove it but it will dissipate and we'll have an big new storage room downstairs. Don't tell Paul, but it would be the perfect room to make beer in (dark, cool). I want to finish the floor with some self-leveling cement and add insulation (especially around the coal door since it gets pretty cold in there, maybe put in a "real" light fixture.

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Burning oil like it's 1927!

We've been having some surprising spurts of warm weather lately, today the high is supposed to reach 82, but it is definitely fall. Last week I heard the furnace kick on when I came home from work in the morning one day too. We're still operating the oil furnace and working on the last 80 gallons from the last delivery at the end of last winter. We should have more than enough oil to last us until the new furnace is installed but I'm still worried about running out. I accepted an estimate for installation of the 92% AFEU furnace and filled out my gas agreement with the utility last Friday (the 19th). The agreement with the utility company promises that they will install gas service to my house for free and I will install a gas burning furnace/water heater/insert within six months. I also had to sign that they weren't liable for any damage caused to my landscaping (don't have much), sprinkler system (don't have one), or sidewalk (I'm a little worried about this one because although the sidewalk is in poor shape, I refuse to pay some city contractor thousands to replace it). Since it's been a week + since I started the process in motion and haven't heard anything yet, I called the utility company right now and found that they, just today, logged my request for new service. Add 3-5 weeks for the service installation, 1 more week for the furnace installation and we could be into November before the new heater is in.

Once I find out when the actual installation date is, if it looks like we have plenty of oil left, I might just crank that thermostat up to 71F while I'm at home! (which, btw, is never so I guess I'll turn up the heat for Paul and Yoshi.)

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How to stay warm all winter with one log*

I've always been a bit of an energy control freak. Given total control of the thermostat has resulted in a 65F temp while at home and 55F while sleeping or at work. I know, that's cold. I don't heat the finished attic and closed the vents in the unused back bedroom and in the kitchen since we're in there infrequently. We have a friend who demands the heat turned up if she comes to our house. Despite my strict controls over the 7-day programmable, touch-screen thermostat We still paid $945 for heating oil last year.

When we bought the house last year I had mixed feelings over the oil fired furnace. I've never had oil heat and it's not that common here on the west coast. I did a little online research and heard a lot of people touting the comfort of oil heat, the competitive price of oil vs natural gas and yet we were already seeing rising gas prices so I knew it wouldn't be cheap. I planned on replacing it (it was 20 years old) but I thought I could hold out though, for a little while. Just a few years of oil might be okay and give me time to make a decision on the next type of furnace. I didn't want to jump to the default of natural gas (the most common choice) since we do have inexpensive electric on the west coast too. None of that mattered though when I saw No. 1 heating oil prices nearing $5/gallon this summer. The price has come down some since (to around $4/gallon) but that could still cost us an additional $430 this winter and believe me, the house is never really warm.

I had a sales rep from a local heating company come to the house to do a quote last week. I wanted to know what all my options were so I could compare the price breaks between the regular, efficient, and super-efficient options. I asked around to get a ball park idea of what it might cost but I was still scared it would be more than I thought, or that I might be required to replace duct work throughout the house. So 80% efficiency is considered normal or average for a furnace and then there's a jump up to 92% efficiency which is energy efficient and if you add a variable speed fan you get another 3%. The price break from 80% to 92% is $450 and then from 92% to 95% is $1100 + $212 for a new thermostat.

I want to be super efficient. I want that variable speed fan. However, that $1300 could be better spent on other things like weather stripping, new storm windows, insulation for the attic. It would take so long to see a return on that additional cost but just moving from the ~60-70% efficient oil furnace to a 92% gas furnace, we will recoup our money in less than 6 years (and I hope that is a conservative estimate). oh, and the local utility company offers a $400 rebate for any gas furnace over 90% AFU making the price difference between the 80% and 92% so small I don't see how anyone could choose the less efficient one. Now I have to call and schedule the installation I guess.

*Carry the log upstairs and throw it out a window. Retrieve the log and repeat.
-Farmers Almanac

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