The historical assumption is that natural gas heating is cheaper than fuel oil as witnessed by the continuing conversion rate of oil to gas. The arguments forwarded are several, most notably that “natural gas (and propane) burn cleaner”, and are therefore “less expensive” than oil and “more efficient”. All of these points are true in some context, but what is excluded has become significant to the discussion. Namely, that heating system efficiency increases and narrowing fuel cost differentials are closing the gap. Exactly how and by how much are the issues.

An old New England adage comes to mind: “You can either raise the roof or lower the floor” to gain more space. Applied to heating you increase the efficiency of your appliance or lower the cost of your fuel ….. or do both, as we will contend.

First, let’s begin by “raising the roof” of heating energy creation efficiency. Here again, hydronic (hot water) boiler efficiencies have increased significantly with AFUE Rating increases of over 10% for gases and half or less that for fuel oil. Good numbers at present are 95% AFUE for gas and 87% AFUE for oil “top end” appliances. More specifically these are Condensing Gas and Triple-Pass Oil Boilers, respectively. Now let’s get in a little deeper.

There are three basic elements in any hydronic heating system:

  1. Heating water (a boiler),
  2. Moving heated water (distribution), then
  3. Heating the environment (radiation).

The contemporary presumption is that the Boiler DOE %AFUE Rating defines the heating system efficiency. This is patently untrue on its face. Distribution and radiation efficiencies must also be included to determine an aggregate value. Radiation by type and deployment also affect distribution configuration and complexity. The distribution “middle ground” between the boiler and radiation we cynically denote as “The Plumber’s Playground”. Herein appears a relative maze of pipes, fittings, circulators, controls and wiring connecting A to B with artistic “free expression”. Thus that new, “pretty piped”, complex heating system despite saving some fuel is an electrical energy hog and a serviceman’s “friend”.

Over a century ago we had the Gravity Hot Water Heating System. It was utterly simple, had no moving parts and was operated by manually regulating a fire under the boiler. Powered coal stokers, oil or gas burners were later added with a room thermostat for automatic heating. It was abandoned upon introduction of the hot water circulator and zone valves that provided heating operational flexibility and remains so to date. However, the natural (gravity) convection attributes of yore are potentially and innately present within “modern” hydronic systems, but are stifled with restrictive “near-boiler piping” practices and “check-valving”. The result is that there has been no means of readily incorporating natural, free energy gravity transmission into contemporary, powered distribution systems.

Introduction of the Delta-T ECM Hydronic Circulator has now enabled us to recreate what we call a “Neo-Gravity Hydronic Heating Appliance”. Natural convection can now be near-boiler piping enhanced and finitely managed by the Delta-T ECM Circulator much like “paddling a canoe with the current” ….. virtually effortlessly! Functionally it is akin to “putting an ‘Automatic Transmission’ on a Boiler”, employing an automotive analogy. Hydronic distribution energy is now typically reduced by over 90% of contemporaries. By further coupling with a high-mass, cast-iron boiler further reduces burner cycling and system operating temperatures, again increasing boiler AFUE substantially, depending upon site radiation and heating demands. These claims are substantiated within our U.S. Patent No. 10,690,356 and Canadian Brevet/Patent No. 2,964,131. Refer to our website www.BoilersOnDemand.com for extensive detailing.

So, first upgrade your aging, less efficient boiler to our benchmark, post-modern, high-mass, Neo-Gravity Delta-T ECM Hydronic Heating Appliance for peak heating energy creation and delivery.

Second, now let’s “lower the floor” by changing your fuel oil buying habits! The “dirty little secret” is that you have fuel procurement options, many options. You don’t just keep buying from “Good Old Joe” because he’s nice and “takes good care of me”, or pick an oil dealer out of the phone book, that your neighbor recommends, or whatever. Not unlike automobile “gas station hopping” the oil distributors have a back door pricing system too, called “Rack Plus Pricing” Contracts with Consumer Fuel Co-Operatives. Co-Ops aggregate fuel demands of their memberships and solicit seasonal quotations for heating fuel. For example, we and our participating customers realized a 25 to 40% reduction over retail pricing in our area (N.H.) throughout the 2019-2020 Heating Season for a $25 Annual Fee! Smarten up folks!

Now, let’s dispel the notion that natural gas fuel is cheaper than oil, using our one-two strategy as detailed above.

All heating fuels are rated by their “Energy Cost Per Million BTU”. Using the NH Climate Audit Heating Cost Calculator (our regional preference) we have calculated heating energy costs continuously since 2016 during our appliance development. In all but one winter cycle oil has been a cheaper heating fuel than natural gas. Oil has also eclipsed all other fuels listed for the past several years. This apparent natural gas discrepancy with oil must be further explained.

Natural gas and electricity are “distributed” fuels, i.e. they are necessarily delivered through pipes or wires to the point of use. Distribution and service charges are necessarily applied to these fuels, typically regulated by a State Utilities Commission. Therefore your actual bill is fuel cost plus delivery charges! Dividing the fuel cost into your total bill defines your Service Burden, expressed as multiplier of 1.x to 2.x. Our local multiplier is typically just over 2 at present. Therefore the Natural Gas Cost Per Million BTU must be multiplied by your Service Burden to obtain your true fuel cost!

Oil and LP (Propane) on the other hand are liquid “delivered” fuels. You pay upon delivery and they are dropped into your oil or gas tank or as gas bottles in your yard. Similarly with the solid fuels: coal, wood & wood pellets. No additional charges apply. This distinction is very important.

Example: Playing with the Heating Cost Calculator, load in 87% for oil & 95% for both natural gas & propane per prior. Load in your current or “Co-Op Price” for oil or gas and press “Recalculate”. Now using a side calculator multiply your natural gas fuel price by your Service Burden, currently 2x or more. As of this update our Energy Cost Delivered to Radiation is $27 per MBTU, utilizing our Appliance and Co-Op Values. (BTW – Pity that poor propane guy!)

If you want to extend your heating calculator play time, increment the item cost values for coal, wood & wood pellets until you equate each to $27 Per MBTU, the item pricing equivalent to oil heating. Great stuff to needle your neighbor who’s “saving money” while trying to keep warm with solid fuels. Of course avoid that Old Yankee that cuts all his own wood “for nuthin” and massages his woodpile year ’round. “Heats ya twice, ya know.”

It must be added that Condensing Gas Appliances are significantly costlier to install with far reduced economic lives vs. cast-iron boilers. Statistically you will buy two other heating systems to equal a good cast-iron boiler system!

“The Heating Blog” also on our website offers a wide array of related heating subject articles.

Updated: 01/07/2024 P.D.M., Sr.

About the Author

Paul Mercier

A Semi-Retired Manufacturing Process Development and Hydronics Engineer.
Following a stellar career in Computer Hardware & Software, Miniature Ball Bearing, Avionics & Panel Meters, Magnetics, Plasma, IC & Discrete Component and Product Manufacturing throughout New England, have re-focused on a second, parallel skill set in Hydronic Heating.
Received U.S. Patent 10,690,356 on an "ENHANCED CONVECTION, DIFFERENTIAL TEMPERATURE MANAGED, HYDRONIC HEATING APPLIANCE". It is America's first, true Hydronic Heating Appliance, enabled by Taco Delta-T ECM Hydronic Circulation coupled with our proprietary near-boiler piping system. The resultant is a simple, durable and efficient hydronic heating appliance that surpasses all contemporary built-on-site systems both in value and performance.

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