Oil & Natural Gas as Heating Fuels Equate @ $45/bbl

By our calculation #2 Heating Oil and Natural Gas equate at an approximate Crude Oil Price per Barrel of $45 in our locale (Northern New England). There are obviously many factors that contribute and must be individually qualified.

Refer to our prior posting on “The Heating Blog” entitled “Oil Again The Cheap Heat ………….. “ for procedural detail. Note that it was published with Oil @ $30/bbl this past January.

Of particular note is to always delineate between a “Delivered” vs. a “Distributed” Fuel. Whereas you purchase a quantity of fuel upon delivery (Oil, Propane, Wood, Coal, etc.), Natural Gas & Electricity are piped/wired to your location and you necessarily pay “service charges” for their facilities usage, maintenance, profit, etc. Factoring your “distributed fuel” bill is simple. Extract the actual cost for “fuel” and divide it into your total bill. The resulting “factor” of 1.XX must be used to multiply any stated “distributed fuel” cost for an actual one. Note that this “factor” is always changing and is particularly dramatic when comparing mid-summer and mid winter fuel costs.

You will note that the only two viable heating fuels at present are Natural Gas and #2 Heating Oil. Even our regional “Fuels of Opportunity” as we refer, Cord Wood & Wood Pellets, as purchased are far less economic than generally perceived. Even “free” (self sourced and provided) Cord Wood is arguably uneconomic in use, particularly in our experience when purchasing and servicing Exterior Wood Boilers, a regional fad.

To achieve an “apples to apples” heating fuel comparison you must use a contemporary appliance cost and performance for the fuels being considered. We use a 95% AFUE average value for Natural Gas & LP (Propane) Appliances and an 87% AFUE for Heating Oil. The Oil vs. Gas Heating Appliance Cost must also  always be considered in calculation, the Gas Appliances being pricier than their Oil equivalents.

The further unwritten and unstated longevity of Gas vs. Oil Installed Systems must be quantified. You are not going to obtain system life expectancy from your “salesman”, who at best quotes Warranties (if you insist) nor provides maintenance histories. These come from the “old sergeants in the trenches” ….. independent service personnel who daily deal with prior work. Unfortunately they are too few, their voices are seldom heard nor are generally known, overshadowed by the self-anointed trade professionals and marketeers. We talk to the Sergeants …..

Please avail yourselves of our extensive “The Heating Blog” Library on our website for further detail to your particular situation.