Heating Calculations and Conversion to Electricity

I have been fielding many questions from those looking to install heat pumps, with the main question being “will it save me money?”. Here are the basic calculations and considerations, and a bill calculator is on the bottom of this page.

Your existing fuel has a cost per kWh, both supply and delivery. For example, in upstate NY, a therm of natural gas contains 29.3 kWh and delivery costs $20.75 for the first three therms + $0.56866 for the next 47 therms + $0.12332 over 50 therms to deliver on top of a supply cost of $0.740225 per therm for June of 2022.

Natural Gas

For example, if one uses 100 therms of natural gas in June of 2022, they will pay 100 * 0.740225 or $74.0225 for supply and $20.75 + 0.56866 * 47 + 0.12332 * 50 = $53.64302. Combined bill would be $127.67.

Update for August 2022: $21.40 + $0.59964 * 47 + $0.13003 * 50 + 100*$0.889595 = $145.04, an increase of over 13.5%, compared to June!

There are other items on you bill, such as Adjustment for Changes from Normal Weather, Delivery Service Adj(s), and a Tariff Surcharge. They can add roughly 4% to the cost of the bill, meaning the $145.04 that we calculated would be $150.84 on the actual bill.

Energy produced with an 80% efficient system would be 100 * 0.80 * 29.3 = 2,344 kWh.

Energy produced with a 98% efficient system would be 100 * 0.98 * 29.3 = 2,871.4 kWh

Many homes have other natural gas appliances, such as a water heater, fireplace insert, gas logs, gas dryer, gas stove, or gas oven. In this case, heating with gas costs even less since it takes care of a large portion of the delivery cost. For example, if a household uses 50 therms for the above, and 100 additional therms for heating, the math looks like this for heating: 100 *(0.12332+0.740225) = $86.35.

Another consideration of gas appliances is that they use electric equipment such as pumps, blowers, lights, and thermostats. If your furnace runs ten hours per day, 30 days in a month, and uses 200 watts of electricity per hour, you will use roughly 60 kWh of electricity, adding an extra $10 or so. If it’s a fancy two stage furnace, or if it’s an older, less efficient furnace, with a big blower, it may double to $20 or more.

Propane

Now, imagine that someone is using propane instead of natural gas. Propane is typically priced per gallon, and contains 27 kWh, while costing $3.

To produce 2,344 kWh, at 80% efficiency, we would need (2,344/27)/.8 = 108.51 gallons x $3 = $325.54, or almost triple the cost of natural gas.

Electric heat

Now imagine, someone is using electric heat. These can be oil filled radiators, heated floors, ceramic heaters, or other designs. The efficiency of most of these is around 100%.

The cost to produce 2,344 kWh of heat at the current cost $17.33 for the service charge + $0.0644/kWh delivery charge + $0.12/kWh supply charge = 17.33+2344*(0.12+0.0644) = $449.56, or nearly four times as much as an 80% efficient natural gas system.

Heat Pump

The math of heat pumps is a little more complicated because the efficiency changes based on the outside temperature of air source heat pumps, while it remains fixed for geothermal heat pumps. Heat pumps will have data sheets that show input and output of kWh based on temperature.

For example, at -3F outside, and 65F inside, a heat pump will consume 1.03kWh while producing 5.26 MBtuh* or 1.54kWh.

For 37 F outside and 65 F inside, the same heat pump will consume 3 kWh to produce 36 MBtuh* or 10.55 kWh.

This means, that at 37F outside and 65F inside, to produce 2344 kWh of heat, one would consume (3/10.55) *2344 = 666.54 kWh costing 17.33+666.54*(0.12+0.644) = $140.25 or slightly more expensive than natural gas.

At -3F outside, and 65 F inside, it would be (1.03/1.54) * 2344 = 1,567.74 kWh costing 17.33 + 1756.74*(0.12+0.644)= $306.42 or nearly triple the cost of natural gas.

Depending on the cost of electricity and natural gas on any given month, the breakeven point for a heat pump can be between 20F and 50F.

*A note on units = 1 ton for compressors is the energy to melt a ton of ice = 12,000 BTU over an hour, or 12MBTUH = 3.52 kWh.

Wood

It is common in many parts of the country to use wood, cord or pellets, to supplement gas/oil/electric heating when prices get high.
1 cord contains around 150 therms, with a large variation based on type of wood, moisture content, and quality. Wood systems also require annual cleaning, with the cost approaching $300 per year, and operate at an efficiency range of 10% for an open fireplace to 90% for the most efficient wood stove. The efficiency is when burning properly conditioned wood under optimum conditions. Prices for wood vary widely, but latest prices I’ve seen are $375 for seasoned, split, wood delivered. To scale it to 100 therms, it would be $250.
1 ton of pellets is around 165 therms, and costs ~$6 per 40 pound bag, which would be $300 for a ton. To scale it to 100 therms, it would be around $181.

Oil

Oil is the last heating fuel I can think of. It is 91,333 BTU per gallon.

Below is a simple calculator to calculate your Natural Gas bill based on prior usage or your actual gas meter, using latest pricing. The cost of delivery can be found under Service Rates and the cost of supply can be found under Supply Costs.

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