pandoraPremium
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| [House&Home] Anyone switch from oil to propane? My home has always had oil heat, years ago we got a System 2000 oil heater. The furnace is nice, but I'm sick of oil filters and am concerned we may have sediment in our oil tank (it's an indoor oil tank, in a garage, for about 15 or so years).
Has anyone migrated from oil to propane in Connecticut? How much more expensive is propane than oil to run? I think my burner can be swapped, but most of the physical plant preserved, though I'm not certain.
Helpful suggestions are appreciated.
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"People demand freedom of speech as a compensation for the freedom of thought which they seldom use." |
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 gregamy
join:2003-05-22
Middletown, CT
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| Interesting that you bring this up, I'm giving it thought as well.
I just renovated my detached garage and added radiant tubing when we poured the concrete floor. For heat I bought a propane-fired on-demand Takagi high-efficiency tankless water heater. I'm in the process now of contracting with a local propane company (Daniels) to provide a 100-gal tank ($90/yr) and propane ($3.27/gal); I'm currently running it on the grill tank.
I'm also talking to them about adding a propane insert into my existing double-sided fireplace to use as supplemental heat. As I've discussed on this forum prior, I currently have a wood stove in the basement for supplemental heat (saves me ~500 gallons oil per year) but this year my regular wood source forgot about me and I don't have much left; and despite all that free wood around after these storms I am totally out of motivation for the year. And trudging in wood all winter gets old pretty quickly. Bottom line: I'm feeling pretty lazy.
I'll have some data in the Spring on how this works out, but if it does well enough I'm giving serious consideration to converting the entire house to propane. I've heard nothing but good about it, and with the outlook of the prices of liquid oil versus petroleum gasses leaning toward gas, it may even pay for itself over time...
Greg |
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| reply to pandora
It makes no sense to switch, unless you get the propane dirt-cheap.
1gal of oil gives ~138,000BTU, if you burn it into an average 83% efficient burner you end up with ~114,500BTU/gal
Given a $3.5/gal price that is ~32,700BTU/$
Propane gives 91,500BTU/gal. If you burn it in a very efficient 95% furnace you get ~87,000BTU/gal
Given a $3.25/gal price that is 26,750BTU/gal.
Historically the price of propane has been very close to the one of oil in terms of $/gal, while yielding less heat. |
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pandoraPremium
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Outland
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| Yeah, but I'm tired of clogged filters, oil smell, and now possibly sediment issues. The darn oil tanks are only about 15 years old.
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"People demand freedom of speech as a compensation for the freedom of thought which they seldom use." |
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| said by pandora:Yeah, but I'm tired of clogged filters, oil smell, and now possibly sediment issues. The darn oil tanks are only about 15 years old. Clogged filters are taken care of during the annual maintenance. Even a propane burner needs maintenance.
If there is smell then something is very wrong... I don't have any oil smell in the basement...
But again, if you don't mind paying $500+/year more, year after year... |
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gregamy
join:2003-05-22
Middletown, CT Reviews:
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| reply to pandora
How does the value compare to natural gas heating?
My problem is that our main living room is a high-ceiling open area, with not enough baseboard space available. There's been a couple January over the last 8 years that without supplemental heating the house wouldn't get above the low-60s. So right now I'm contemplating either getting motivated and continuing to burn wood*, getting a propane insert in the living room fireplace (roughly $1200 installed), or adding some kind of radiant floor heating tubing throughout that living area (roughly twice the initial install price of a propane insert.
GA
* This may happen for this year, though I'm actually having a hard time finding seasoned wood at a good price. Lots of "free" new stuff, though. Steve here on the board has a brother-in-law with tons of stuff just waiting to be collected...and cut...and split...and stacked...and brought in each day...ugh...so it's not like it's an "expense" thing. Just time and motivation. |
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 JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1 | reply to pandora
When I built my house in 2009, I went all propane- heat, hot water, dryer, and stove. I own my 500 gallon underground tank and interestingly, just got my first fill up of the season: $2.24/gallon (including the 10 cents per gallon discount for paying within 10 days).
The key is to own your propane tank to get the best rates- leasing is a ripoff and where you will get burned. Buy a big tank and shop around a bit. I use Northeast Propane (aka Uncas Gas). Good company to do business with. I would use propane if I built again and would seriously consider a switch if I were you. Good luck. Let me know if i can answer any questions. |
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pandoraPremium
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| reply to gregamy
said by gregamy:How does the value compare to natural gas heating?
I wish our neighborhood had natural gas. We have no sewer, no water and no natural gas. Only propane, which seems to be a bit more expensive than oil.
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"People demand freedom of speech as a compensation for the freedom of thought which they seldom use." |
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JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1
2 edits | reply to cowboyro
said by cowboyro:It makes no sense to switch, unless you get the propane dirt-cheap.
1gal of oil gives ~138,000BTU, if you burn it into an average 83% efficient burner you end up with ~114,500BTU/gal
Given a $3.5/gal price that is ~32,700BTU/$
Propane gives 91,500BTU/gal. If you burn it in a very efficient 95% furnace you get ~87,000BTU/gal
Given a $3.25/gal price that is 26,750BTU/gal.
Historically the price of propane has been very close to the one of oil in terms of $/gal, while yielding less heat.
Where are you getting 3.25/gallon as the price of propane? Are you assuming a tank lease? My fill-up today was $2.24/gallon through Northeast Propane. That changes the outcomes of your assumptions quite a bit when calculated with my fill-up price- it's more cost effective than oil at ~38,839BTU/$ |
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JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1 | reply to pandora
Re: [House&Home] Anyone switch from oil to propane? said by pandora:said by gregamy:How does the value compare to natural gas heating?
I wish our neighborhood had natural gas. We have no sewer, no water and no natural gas. Only propane, which seems to be a bit more expensive than oil. I think it also depends on the propane appliances you run. I have a tankless propane hot water heater that saves me a boatload of money on hot water generation. It's 199,000 btu and services 3 simultaneous showers. it's ridiculously efficient... consider upgrading multiple home appliances to make the conversion the most efficient you can possibly can... but i'll say it again- BUY THE TANK!! That's the most important thing you can do to keep the price low in the long run. |
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 GrumpyPremium
join:2001-07-28
NW CT
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2 edits | reply to JimCT
said by JimCT:My fill-up today was $2.24/gallon through Northeast Propane.
That's a killer price. You paid 86 cents per gallon less than the state average. Is that a contract or pre-pay price?
»integrityenergy.com/category/cur···-prices/
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»www.energysavers.gov/your_home/s···ic=12330 |
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JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1 | No contract, not pre-pay. I'm simply on automatic delivery, but that price would be the same if i was a "will-call" customer. I get that price because I own my tank (and because the tank is so big). Getting cheap prices on propane comes down to tank size and ownership. I don't see how anyone can "average" propane prices when propane pricing is based on a huge number of variables that the homeowner can control.
Anyway, that's not special to me... anyone could get that price from them. I recommend anyone I know to go through Northeast Propane (Uncas Gas in the southeast). They're a good company to do business with. |
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GrumpyPremium
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4 edits | reply to cowboyro
said by cowboyro:1gal of oil gives ~138,000BTU, if you burn it into an average 83% efficient burner you end up with ~114,500BTU/gal
Propane gives 91,500BTU/gal. If you burn it in a very efficient 95% furnace you get ~87,000BTU/gal
Pricing above removed by Grumpy
The above data is an excellent formula to estimate costs. Know too that certain oil burners are now breaking into the 90s for efficiency, but one could assume these do not come cheaply, nor would a simple burner change out into an old furnace accomplish the 90s percentile efficiency. I would suppose one could use 20 years as a amortization factor to compare the price of new furnace units? Periodic maintenance costs need to go in the mix too, obviously.
I was involved with petroleum for many years but I don't really know which is cheaper, propane or oil? My limited research into propane tank ownership did reveal it can be costly to buy one, but that depends upon size. I'm not suggesting it's a bad idea, just that it needs to be factored in.
As we all can see, this is a complicated multi-factor comparison, and often very different from one user to the next, depending upon certain variables largely skewed by cost of new equipment.
Here is historical data to play with using average retail pricing. It can be downloaded into Excel (XLS file) to play around with
Heating oil 1990 through Nov 21, 2011
»www.eia.gov/dnav/pet/hist/LeafHa···_DPG&f=W
Propane same dates
»www.eia.gov/dnav/pet/hist/LeafHa···_DPG&f=W
Jim makes a valid point about propane pricing vs. tank ownership. I'm not sure how to factor that when making a historical pricing comparison. I would surmise the best one can do via a price study is to strive for a long term rough idea of what the differences are.
When it comes to pricing energy, we tend to think in pennies. Gasoline is a perfect example, and that neighbor we all know who drives 27 miles to save 2 cents a gallon X 20 gallons - $3.45 for travel gas = (-$3.05) in savings. Point being, if propane turned out to be $100 a year more, to many that may well be worth it. I'm not about throwing hundred dollar bills around, but the pros and cons of the two fuels could well be bought off for an amount of that size in that propane does have a lot going for it, and if you will excuse yet another Grumpyism, finding oil techs these days who can operate at the competent diagnostician level is not a 100% issue. there is a local oil guy who I have nicknamed "Noheat Callback." After a routine cleaning, he somehow turned the boss's one year old Buderus into a temporary two ton paper weight as far as producing heat goes. I have multiple similar experiences with this guy over the years, and politics kept him in the service loop. It's a long story... |
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gregamy
join:2003-05-22
Middletown, CT Reviews:
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| reply to JimCT
said by JimCT:Getting cheap prices on propane comes down to tank size and ownership. So what you're saying is, "get lucky* and buy a house with an existing underground 500-gallon tank". OK, good thing for me to know. Except...
* ...I would NEVER EVER EVER buy a house with an existing underground petroleum tank. NEVER. You may be saving a few cents per BTU now, but GOD FORBID that tank ever leak; by the time the DEP got done with you you'd have extra orifices in your rear and lots more holes in your wallet. Ever hear of John Fitch?
But let's look at it from a more-economic, less "lucky" perspective. I'm signing a contract for a $90/yr lease on a 100 gallon above-ground tank. Rough Google checks for the cost of a 500-gallon tank show around $1200 for one, plus shipping and installation.
So, anyone want to run the numbers? I'm paying $90/yr to lease a 100-gallon tank, will be on automatic delivery, and will be paying ~$3.27/gallon for propane. I don't own the tank, so any repairs and maintenance on the tank is included in that annual lease fee. Any required recertification/replacement is the tank owner's responsibility.
Jim wants me to buy a 500-gallon tank at ~$1200 and I'm responsible for delivery of the tank, installation, as well as repairs, maintenance, and recertification (do above-ground tanks like this require recertification every 12 years as do retail tanks?) Let's leave aside the issue of a big white tank sitting next to my bedroom window, since it can't do in the basement like my heating oil tank can.
In return I can apparently buy propane at a dollar less per gallon.
How's that work out for me?
GA |
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JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1 | said by gregamy:So what you're saying is, "get lucky* and buy a house with an existing underground 500-gallon tank". OK, good thing for me to know. Except...
* ...I would NEVER EVER EVER buy a house with an existing underground petroleum tank. NEVER. You may be saving a few cents per BTU now, but GOD FORBID that tank ever leak; by the time the DEP got done with you you'd have extra orifices in your rear and lots more holes in your wallet. Ever hear of John Fitch?
But let's look at it from a more-economic, less "lucky" perspective. I'm signing a contract for a $90/yr lease on a 100 gallon above-ground tank. Rough Google checks for the cost of a 500-gallon tank show around $1200 for one, plus shipping and installation.
So, anyone want to run the numbers? I'm paying $90/yr to lease a 100-gallon tank, will be on automatic delivery, and will be paying ~$3.27/gallon for propane. I don't own the tank, so any repairs and maintenance on the tank is included in that annual lease fee. Any required recertification/replacement is the tank owner's responsibility.
Jim wants me to buy a 500-gallon tank at ~$1200 and I'm responsible for delivery of the tank, installation, as well as repairs, maintenance, and recertification (do above-ground tanks like this require recertification every 12 years as do retail tanks?) Let's leave aside the issue of a big white tank sitting next to my bedroom window, since it can't do in the basement like my heating oil tank can.
In return I can apparently buy propane at a dollar less per gallon.
How's that work out for me?
GA
Hold on there,
Propane is not the same as a petroleum oil tank- propane is a clean fuel and if there was a leak, it can't contaminate the ground. I did a quick search for John Fitch and it appears he had an underground OIL tank, not propane. He's in a totally different boat, and I would NEVER buy an underground OIL tank either.
My underground tank cost me $1800 plus $400 installation. An above-ground 500 gallon tank is less expensive to buy and less expensive to install, but to my opinion, is more unsightly. There is an upfront cost that isn't there for leasing propane tanks, or a basement oil tank, but given the savings that I am getting on propane pricing, coupled with the fact that I intend to stick around for the long haul, it's a good long run investment. It might not be for everyone, but for me it is. Everyone in my new neighborhood has propane heat, appliances, etc, but I'm the only one who bought their tank, all the rest were leased from Osterman Gas, and comparing notes on their yearly propane costs, I'm glad I went the route I did- some of their pricing is just ridiculous in comparison.
And yes, I assume the risk of a tank failure. If I need to have it repaired/replaced, it's on my dime, and that can get expensive... but do you realize how many times you pay for that tank in the long run under a leasing program? Depending on the timeframe, it could be a stunning amount of money. For me, I'll take that small chance of a tank replacement over what my neighbor's pay for propane in a leased underground tank. And they had to sign minimum 5-year agreements!!
And finally, my guess gregamy is that you use propane to do small appliance work- dryer or gas fireplace maybe?? You may not have a need for a big tank bought for your purposes... but for most modern construction, propane and nat gas is now more the norm and less the exception (ALL homes in my neighborhood, which is still being developed, are propane with 500 gallon underground tanks). When you consume propane for house heating purposes... price matters.
There is no one size fits all... but if I were to build again, I'd go propane again and buy the tank assuming I had intentions to stay for some time. At 80+ cents per gallon discount and the rate I burn propane, it doesn't take long to pay that tank back and reap a benefit on the investment. |
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I think we can end the oil vs propane cheapness dispute.
The graph is based on the referenced data, assuming the real average 85% oil burner and a very efficient 95% propane burner (average reality is 90% though).
Even given this advantage to propane, on average during the last 10 years it was still 40% more expensive (standard deviation 14%). Highest was 73%, lowest 9%. |
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JimCTProbably Pricing PropanePremium
join:2006-01-11
Connecticut
kudos:1 | said by cowboyro:I think we can end the oil vs propane cheapness dispute.
[att=1]
The graph is based on the referenced data, assuming the real average 85% oil burner and a very efficient 95% propane burner (average reality is 90% though).
Even given this advantage to propane, on average during the last 10 years it was still 40% more expensive (standard deviation 14%). Highest was 73%, lowest 9%.
I don't want to beat the point to death, but what are the specifics of the propane price assumed in your model? Does this assume a leased tank, and if so, what size tank? At least then you can make a reasonable judgement if it's an apples to apples comparison (which is impossible, but at least more reasonable). |
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gregamy
join:2003-05-22
Middletown, CT Reviews:
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| reply to JimCT
Check out second post above: I have no propane yet, adding it to heat detached garage, thinking about adding supplemental propane fireplace insert, less so thinking about whole-home propane.
What is the expected usable life of an underground tank? Is 25 years reasonable? Less?
Purchase
$2200 purchase/install over 25 years = $2200 NPV (net present value)
$2.24/gallon for propane
Lease
$90/yr over 25 years = ~$1350 NPV, assuming 5% interest
$3.25/gallon for propane
You spend $850 more over 25 years for the initial install. Depending on your use, ignoring any repairs/recerts/etc, and assuming that fuel price difference stands ongoing, assuming usage of 850 gallons per year, you'll pay for that difference in only one year. Over 25 years that's a savings of about $12k in today's money.
BUT...are you SURE about those prices on fuel? Are you SURE this isn't a case of someone getting in trouble because they screwed up and should have charged you $3.24 instead of $2.24? How long have you been purchasing at those discounted prices? How confident are you that this price differential will last?
GA |
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said by JimCT:I don't want to beat the point to death, but what are the specifics of the propane price assumed in your model? Average retail price in NE.
Since the cost is 40% higher on average, saving few pennies doesn't make a difference.
However some pennies can be saved with prepaid oil, so back to square one. |
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