Ever think about making the switch from heating oil to propane? Ten years ago this was touted as a great way to save money. Today, however, this could not be further from the truth. I use both heating oil and propane in my house, and I wanted to share some thoughts about both here.
Benefits of Propane
Propane is one of the most versatile fuels. If you do not have access to natural gas where you live, propane offers many of the same benefits:
Powering a generator.
Fueling a gas fireplace.
Fueling a gas cooktop.
There are also tasks that can be accomplished by either heating oil or propane, and these include:
Heating your house.
Heating your hot water.
Since heating oil creates significantly more heat per gallon than propane (you will need 1.35 gallons of propane to create the same heat as 1 gallon of heating oil), you are much better off heating your home with oil. That said, you can still have propane at your house for other purposes, such as a gas fireplace or generator.
Disadvantages of Propane
While propane is very similar to natural gas, the main difference is that it needs to be delivered. This puts it into the same category as heating oil: fuels that are delivered via truck. That said, there is a big difference between heating oil and propane: with heating oil, the homeowner always owns the tank. With propane, the supplier almost always owns the tank. This leads to some often overlooked disadvantages, including:
Switching propane suppliers is very difficult. This is because 95% of the time the propane company owns the tank on your property – not you! This means that another company cannot fill your tank, even if you wanted them to.
Propane is very difficult to price-compare. Try calling around for a price per gallon for propane. Most dealers will not give this to you – even over the phone. They will ask you a series of questions such as how many gallons you plan on using over the course of the year. With heating oil, there is a very clear market price per gallon. You can use a site like FuelSnap to compare prices for heating oil and order oil online.
Propane is more expensive than heating oil. Not only does propane cost more per gallon than heating oil, you actually need 35% more propane to generate the same amount of heat as heating oil! So if you’re comparing prices of propane and heating oil, multiply the propane price by 1.35 to see how it compares to today’s going rate for heating oil.
What is the Best Fuel Type for Heating Your Home?
If you have access to natural gas where you live, then this is the hands down winner. It is not only very versatile, it is also economical and does not have to be delivered. You simply pay your bill every month as you do your electric bill.
Between heating oil and propane, however, heating oil is far superior. It is not only less expensive, but you have significantly more freedom with heating oil. You can price compare to make sure you’re getting the best deal, and order heating oil online whenever your tank is low.
Furthermore, if you still want to run a gas stove top or fireplace, you can also have propane! Just get a single propane tank for these ancillary uses and you can get the best of both worlds. If you’re still deciding between heating oil and propane, check out this post here for a deeper dive into the topic.
Oil-heated homes are among the most popular in the Northeast. While natural gas is more common elsewhere, the age of homes and the rocky ground make pipelines less prevalent here. Heating oil is popular because it is cost-effective, easy to come by, and extremely safe. Read on to learn about the benefits of oil heat!
Introduction to Heating Oil
Heating oil is one of the most popular fuel types in the Northeast. It is stored in an oil tank somewhere on the property, and fed into a boiler or furnace where it is burned and converted to heat. You will mostly likely find the oil tank inside the basement of the house.
However, heating oil tanks can also be found outside the house, in the garage, or even underground. Underground heating oil tanks are less common these days, and are generally undesirable as they could unknowingly start leaking over time.
If you are considering buying a home with an underground oil tank, we recommend removing it and replacing it with an above ground tank. Follow this guide on choosing a new heating oil tank if this is the case.
Heating Oil Delivery
To keep the heat running, you must periodically fill your heating oil tank. We break down the process of filling a heating oil tank in this blog post here. To keep your heating oil tank filled, you must sign up for automatic delivery or plan on ordering heating oil online each time your tank is low. There are pros and cons to automatic delivery which we break down here.
In a nut shell, it is much more cost-effective to only order heating oil as needed. Automatic delivery costs several hundred dollars more per year, and devices like the Smart Oil Gauge make it so this is no longer necessary.
Benefits of Home Heating Oil
There are many benefits to home heating oil, including:
It is safe. Heating oil has a flash point of 140° F. Because of this, it is actually not even flammable at room temperature. This makes it extremely safe, and not something you have to worry about having in your home. To ignite heating oil, you must first preheat it, and then atomize it.
It is efficient. A gallon of heating oil generates 138,500 BTUs per gallon (BTUs are a unit of heat). Since burners tend to be about 85% efficient, this equates to 117,725 effective BTUs per gallon. Propane, on the other hand, only generates 91,500 BTUs per gallon. With a 95% efficiency burner, this equates to only 86,925 effective BTUs per gallon. In sum, it takes 1.35 gallons of propane to generate as much heating as a single gallon of heating oil! Read this post here on what your propane provider won’t tell you if you are thinking about propane.
It is widely available. There are literally thousands of heating oil dealers throughout the Northeast. With a site like FuelSnap, you can compare prices from local dealers, all of which are competing for your business. This ensures you are getting the best price whenever you need to order heating oil. With propane, you will lose the flexibility of shopping around. This is because propane dealers – notthe homeowners – own 95% of the propane tanks in the Northeast!
It is cost-effective. Because of its ability to generate so much heat per gallon, heating oil is extremely cost-effective. Oil prices have fallen drastically over the past decade, and as a homeowner you have the ability to price-compare between different suppliers. This competition keeps oil prices as low as possible – so long as you don’t sign up for automatic delivery. If you sign up for automatic delivery, you will be paying more per gallon to get your heating oil from one single supplier. While this is convenient, it costs you a lot of money in the long run. Check out this post here on the pros and cons of automatic heating oil delivery.
Should I Buy a Home with Heating Oil? Yes.
In summary, oil heat is a safe, cost-effective fuel for heating your home. If you are choosing between propane or heating oil, heating oil wins out all day long. If you have the option for natural gas, then we would recommend considering it. Natural gas is not only cost-effective, but you do not have to worry about maintaining your supply.
However, heating oil affords you the ability to choose between suppliers to ensure you are always getting the best price. You can order oil only as needed on a site like FuelSnap where you can comparison shop between dealers. And to make sure you don’t run out of heating oil, install a Smart Oil Gauge to keep an eye on your tank from your phone.
Choosing a home heating fuel type is a major decision if you live in the northeast. While smaller homes or condominiums may offer electric heat, most larger homes do not, as it becomes too expensive to heat large spaces. Instead, more cost-effective heating fuels exist, and we will break down which is best in this post below.
Heating Oil, Propane, and Natural Gas
The three main heating fuel types are heating oil, natural gas, and propane. Each has its pros and cons, and it’s important to choose one based on what you are hoping to get from your house. For instance, if you must have a gas stove at the house, you will want to have natural gas or propane available – even if it is for cooking only.
Natural gas is a popular choice in the northeast, but tends to only be available in cities and the densely populated surrounding towns. It is piped through underground lines beneath the street. You can often tell where there is natural gas available because the roads are constantly being cut open and patched to access and maintain the lines. You can also look at the homes along the street and see if they are fitted with meters like the one pictured below. These meters regulate and track the flow of natural gas into the home. The homeowner is then billed by the natural gas company just like they are billed for electricity usage. Outside of the cities and in the suburbs, you will find that houses are more spread out, roads have more hills and rocks, and natural gas is much less common. For this reason, houses in the suburbs are often equipped with storage tanks at the house for either heating oil or propane.
Propane is very similar to natural gas, but it is stored in holding tanks on the property instead of being plumbed in from a pipeline. The gas is pressurized in the tank and actually stored as a liquid – hence the common abbreviation L.P. for liquid propane. The tanks are most often stored above-ground, and are rather unsightly. For approximately 95% of the tanks in the northeast, the propane provider actually owns the tanks as well. This is problematic, as it prevents you as the homeowner from ordering propane from anyone else. This leads to a very high price per gallon for propane – sometimes as high as 2X the price per gallon of heating oil. If you are considering choosing propane for your home heating fuel needs, make sure you read this post here.
Heating oil is a favorite for home heating because it puts out a tremendous amount of heat – approximately 35% more effective BTUs per gallon than propane – at a much lower cost than propane. While heating oil and natural gas tend to be comparable lately in terms of cost, there were times when the price of heating oil rose and made natural gas a much more attractive option. Oil prices have declined significantly in recent years, however, and remain low today. Another benefit of heating oil is that it can be bought off-season and stored, allowing the homeowner to benefit from lower prices in the summer. There are also dozens of heating oil providers in nearly every town in the northeast, meaning there is always competition to choose from. This competition ensures that prices stay reasonable, and you will not be stuck with a monopolistic utility provider as you will with natural gas.
Choosing Between Heating Oil, Natural Gas, and Propane
If given the choice between all three options, it’s important to consider the trade-offs. In terms of cost, heating oil and natural gas are the clear winners. Propane is often twice as expensive when used to heat a house. Since natural gas is provided by a monopoly utility provider, you may prefer heating oil so you can choose from multiple suppliers. If you do not want to worry about your fuel supply, you can sign up for ‘automatic delivery’ of heating oil or propane, in which case the truck will come automatically on a schedule, and the experience will be much like that of having a natural gas line plumbed right into your house. The one limitation of heating oil, however, is that while you can use it to heat your home and hot water, you cannot use it for a gas stove, gas fireplace, or generator. For these, you will need a propane tank outside the house, or natural gas.
Conclusion: Heating Oil and Propane OR Natural Gas
If you find a house that has natural gas coming in from the outside, then you will be able to cost-effectively heat your home, and run auxiliary systems such as fireplaces, stoves, etc.
If natural gas is not available, however, we recommend heating oil to heat your home. Heating oil is significantly more cost-effective than propane, and affords you the ability to shop around from multiple suppliers to get the best price. Since propane suppliers almost always own the tank, there is very little you can do to negotiate a good price. With heating oil, however, you can use a site like FuelSnap to check heating oil prices from local, reputable heating oil dealers in your area and order heating oil online in seconds.
If natural gas is not available and you would like the best of both worlds, then we highly recommend heating oil and propane. Using heating oil to heat your home and hot water is the most cost-effective solution available. And having a single propane tank for stove-top cooking, gas fireplaces, and maybe even a standby generator is a great option as well.
Heating oil is a popular choice for home heating – especially in the Northeast. But what makes heating oil so popular here? It turns out that home heating oil is not only extremely efficient, but also very safe and easy to come by in the Northeast. In today’s post we’ll break down the origins of home heating oil and why it remains such a popular fuel for home heating.
Home Heating Oil and Forced Hot Air
The Northeast US has some of the oldest homes in the country – with many dating back to the 1800s or earlier. In the early 1900s, many homes were heated with coal-fired furnaces in the basement. Coal was delivered by truck and shoveled into a hot furnace to keep the home warm. In the 1930s, oil-fired furnaces were introduced, and slowly began to replace coal or wood-fired systems of the past. Oil was much more convenient than coal or wood. Not only did it produce more heat, but it was much easier to operate, as the oil could simply be stored in and drawn from a heating oil tank directly to the burner. This eliminated the need to manually add coal or wood to a burner in the basement.
The Transition to Home Heating Oil From Coal
The ease of heating with oil, coupled with the low cost and high heat output made home heating oil increasingly popular in the mid-1900s. Many coal delivery companies began to evolve into coal and home heating oil companies, and eventually began selling only heating oil.
It’s Safe: At room temperature, home heating oil cannot be ignited. In fact, heating oil must be heated to 140° F and atomized before it can be ignited in a burner.
It’s Efficient: Heating oil produces over 138,000 BTUs per gallon. Home heating oil is significantly more efficient than propane, which produces approximately 91,500 BTUs per gallon. While oil furnaces are not able to deliver 100% of that heat to the home, they are able to deliver about 85% of it to the home, for about 117,725 effective BTUs per gallon. This compares to propane furnaces, which are about 95% efficient, and therefore produce approximately 86,925 effective BTUs per gallon.
It’s Cost-Effective: Oil prices in today’s market have dropped significantly from their peak. Oil is currently in the mid $1.50 range in the Northeast. This compares to propane which is well north of $2.00 per gallon. And considering a home needs 1.35 gallons of propane to produce the same amount of heat as one gallon of heating oil, the price for propane is nearly twice that of heating oil!
The Homeowner Is Free to Shop Around: Heating oil tanks always belong to the homeowner. Unlike with propane, you are free to buy from any supplier you’d like. This gives you maximum flexibility and saves you hundreds of dollars per year.
You Can Add Diesel If You Run Out: Since heating oil is virtually the same fuel as diesel, you will not be left in the cold if you accidentally run out. You can simply go to the gas station, grab five gallons of diesel fuel, and add it to your oil tank. Five gallons is usually enough to last the night until you can have the heating oil tank filled. Be sure to follow our guide if you ever run out of heating oil.
Home Heating Oil Is Extremely Easy to Monitor
Historically, folks with oil-heated homes have had to either sign up for ‘automatic delivery’ or remember to check their oil tank periodically. This would ensure they do not run out of home heating oil on a cold night.
Today, however, tools like the Smart Oil Gauge exist to alert you when your oil tank is low. You can track your usage per day, week, month, or year to know how much home heating oil you are using. You can adjust the thermostat to save heating oil as well. And finally, when you’re low, you can use a site like FuelSnap to easily shop for heating oil.
Home Heating Oil is a Great Source for Heat
If you’re shopping for a new home in the Northeast, you should feel comfortable if it is heated with oil. Home heating oil provides great value in that it is relatively inexpensive and produces significant BTUs per gallon.
Having a heating oil tank inside the house means you can buy heating oil on a site like FuelSnap from whichever heating oil dealer you’d like. Check local New England oil prices, and pay with a credit card to have heating oil delivered in no time. Do not worry about getting stuck with one single supplier as is often the case with propane or natural gas.
Choosing a heating system for a new home requires understanding different ways homes are heated and how home heating works. From oil to propane, natural gas to electric, there are a variety of fuel types to choose from. And from radiant floor heat, to forced hot air that comes through vents in the floors, there are also many ways to heat the space inside the home. In this post, we’ll break down our favorites and reasoning for our choices…read on below!
How to Choose a Heating Fuel Type
Depending on where your new home is being built, your options for fuel type may be limited. If you are in the Midwest or Northwest US, natural gas may be your only choice. In the northeast however, you may be choosing between heating oil, propane, or natural gas. Electric heat is also an option, but we do not recommend it if you live in a cold climate, as it can be very expensive in the wintertime.
Natural Gas: If your neighborhood has natural gas, we recommend tapping into it for your home’s heating system. You can also use natural gas for fireplaces, backup generators, and pool heaters. The downside to natural gas is you are dependent on one supplier, and therefore cannot price compare and switch between suppliers. If the price goes up, you are stuck.
Heating Oil: Heating oil generates more heat per gallon than any other fuel type, and as of this writing is about as cost-effective as natural gas. The nice thing about heating oil is that you can choose from many heating oil suppliers and store a large quantity of heating oil in an oil tank in your basement. This allows you to stock up in the off-season and avoid fluctuating local oil prices in the winter.
Propane: Propane is the most expensive option when it comes to heating your home, so we recommend avoiding it. Propane not only puts out less heat per gallon than heating oil, but actually costs more per gallon. Further, when you use propane, the propane supplier will provide you with a tank. This prevents you from ordering propane from any other supplier – even if the price is lower! The only benefit to propane is it can also be used for cooking and gas fireplaces. That said, you can always use both heating oil and propane if you would like the best of both worlds and natural gas is not available.
Choosing a Heating System
There are two basic heating types: air-based systems and water-based systems.
Air-Based Systems (Forced Hot Air)
Air-based systems rely on a furnace to heat incoming air. Once the air is hot, a blower circulates this air through ducts throughout the house.
Benefits of air-based heating systems:
Duct work is relatively inexpensive to install during new construction.
Vents can be closed off in rooms that do not need to be heated.
The space can be heated very quickly.
The same ducts can be used for a central A/C cooling system.
Water-Based Systems (Boilers)
The second type of system, which was more common before central A/C was introduced, is a water-based system. This type of heating system features a boiler which heats water in the basement. This hot water is then pumped through radiators that are placed throughout the house. The radiators slowly heat the surrounding air and warm the house up.
Benefits of water-based systems
These systems retain heat better, as the water in the radiators stays warm.
They can be used with under-floor heating (also known as radiant floor heat) for extremely comfortable warm floors.
Hydronic Heating Systems (Hybrid Systems for Water and Air)
Our favorite type of home heating system for new construction is a hydronic system. This type of system uses a water heater to heat water for the house. This water can be used in two ways:
The hot water can be used in the floor to provide radiant heating. There is nothing like walking on warm floors on a cold winter day.
The hot water can be sent to a heat exchanger to heat air as well. In this case, forced hot air remains a back-up option to quickly heat the air in the home.
Benefits of a Hydronic System with Radiant Floor Heat:
The coziness of warm floors provided by radiant floor heat is second to none.
The floors help retain heat throughout the day.
The backup forced hot air can help heat the house quickly, or provide a backup heat source on a really cold day.
Summary: Forced Hot Air is a Must
If you’re considering building a new house, you should, at the very least, install a forced hot air system. This will allow you to very easily install a central A/C system as well. You can install the A/C system while building the house up front, or always add it later – just be sure to specify a furnace that has enough clearance to add coils for cold air.
If your budget will allow, then you should consider a hybrid system that incorporates hot water and hot air. This will provide the duct work for quickly heating the house but will also accommodate radiant floor heat. Radiant floor heat provides maximum coziness in the winter and tends to maintain the heat nicely throughout the day.
Since you’ll already have the duct work, this will allow you to have central A/C installed as well. Planning for this during construction will eliminate the need for any renovations down the road. As for a fuel type, we recommend natural gas if it’s available, and heating oil if it is not. Propane is unnecessarily expensive and will make it very difficult to switch providers or price shop if need be.
If you choose home heating oil as your primary fuel type, FuelSnap has the best New England oil prices around. Compare oil prices from various heating oil suppliers, find your perfect fit and enjoy the home heating oil delivery! Yes, it really is that simple.
In the northeast US, we see the full range of temperatures, and all types of weather throughout the year. And depending on the winter, we even see subzero temperatures at times. If you’re looking into buying a house in the northeast, you’ll want to understand how home heating works. In this post we’ll talk through the different fuel types, as well as the different types of heating systems you may find in a house, so read on below!
Steps in the Home Heating Process
There are three things that have to happen in order for a home to be heated. First, a fuel source must be delivered to the house. We’ll break down the pros and cons of the most common fuel types below. Second, the fuel source must be converted to heat. This is typically done in a boiler or furnace, but electric radiators can be used as well. Finally, the heat must be transferred throughout the house. This can be via warm air that is circulated through ducts, or via water or electricity that warms radiators along the walls throughout the house. We’ll dive further into these below as well.
Home Heating Fuel Types
There are a number of different fuel sources in the northeast, each with their pros and cons. While each of these must be delivered to the house, they are all delivered in different ways:
Heating Oil: One of the most popular fuel choices in the northeast, heating oil is delivered to a house by a home heating oil delivery truck. The heating oil is stored in an oil tank that is usually located in the home’s basement but can occasionally be found outside or underground. The nice thing about heating oil is it burns hotter than natural gas or propane, which makes it an extremely cost-effective choice, especially when prices are low like they are in 2020. As a homeowner, you are free to choose from any supplier you want. Just don’t forget to reorder, as you can easily run out if you forget! For more information read How to Fill a Home Heating Oil Tank.
Natural Gas: Natural gas is also a great choice for home heating – if it is available where you live. Natural gas is plumbed underground through pipelines and directly to a home from the street. Treated as a utility, the homeowner does not have to worry about having natural gas delivered – it simply comes automatically, and they have to pay the bill. The downside, however, is that you cannot choose from multiple suppliers.
Propane: Propane, like heating oil, is delivered to a house via delivery truck. It is stored in a tank – or tanks – outside the house. While propane tends to be more expensive than natural gas or heating oil, the nice thing is that it can also be used for a gas stove, fireplace, or generator. For more information read Heating Oil vs. Propane.
Electricity: Since virtually every house has electricity, this can sometimes be used for heating as well. Especially in places where winters do not get too cold, electric heat can be good to have on standby, but is generally too expensive to be considered in larger homes or places with very cold winters.
Converting the Fuel Source to Heat
The next part of the process of heating a home involves converting your fuel source to heat. For propane and natural gas, a burner is used to easily ignite the fuel as it is released from the incoming gas lines. The burner is either part of a boiler, which heats water that gets pumped throughout the house, or a furnace, which heats air that gets pumped throughout the house.
Heating oil is a bit different from propane and natural gas because it is actually not flammable at room temperature. In order for home heating oil to ignite in a burner, it must be first heated to 140° F and atomized through a nozzle. Only once heating oil has been heated and atomized can it be ignited in the burner.
If your house has electric heat, then you will likely have electric radiators throughout the house, or a heat pump. A heat pump is a system that is mounted outside the house and heats your house by extracting heat from the outside air, and transferring it into the house. One of the benefits of a heat pump is that they can often work as an air conditioning system in the summer time by extracting the heat from the house and transferring it outside.
Transferring the Heat Throughout the House
Once the fuel source has been delivered to the home and converted to heat, that heat must then be transferred throughout the house.
One very common way that heat is transferred throughout the home is through a boiler. In a boiler system, water is heated and then pumped through radiators that are located all throughout the house. Occasionally, a boiler will also send the hot water to a heat exchanger where air will be heated and pumped out via a blower to heat other parts of the house.
Radiators, such as those shown below, can also be electric. When they are electric, they simply turn on and heat up when the thermostat calls for heat, then shut off once the room is warm. The benefit to electric radiators is that there is no need for a complex plumbing system to send hot water to the radiators. The downside is that it can get very expensive to heat a larger home with electricity. As such, electric heat is only recommended for small spaces or places with very mild winters.
My personal favorite is radiant floor heat. This is where instead of the radiators being placed along the walls, the floor itself radiates heat. The plumbing is installed in the floor and the result is some warm floors throughout the house! The only downside to radiant floor heat is that it can take a while to heat the house up. This means it may not be a great choice for a weekend house where you arrive on a Friday and need to wait several hours for the house to get up to a comfortable temperature.
Finally, perhaps the most common means of heating a house today is through what’s known as ‘forced hot air’. This is where a furnace is used to heat air in the basement, then a blower is used to send that hot air through ducts in the house. Forced hot air is great for quickly changing the temperature inside the house. It is also preferred because the same ducts can often be used for central cooling in the summertime.
Summary: How Home Heating Works
If you’re shopping for a home in the northeast, it is important to understand how home heating works. You’ll have to first identify the fuel source for that particular home. If the house has natural gas or electricity, you don’t have much of a choice when it comes to your supplier. For propane, you typically must select one supplier to provide all of your propane for the year, and they will often provide the tank as well. With heating oil, you have maximum flexibility and can use a site like FuelSnap to compare heating oil prices from multiple oil dealers in your area, saving hundreds of dollars a year over automatic home heating oil delivery (where one company provides all your oil for the year). Just remember to also install a Smart Oil Gauge so you don’t accidentally run out of heating oil in the middle of winter!
Next, you’ll want to understand what type of heating system the house has. If the house has forced hot air, it means that it will be very easy to add central cooling to the house in the future. For the best of both worlds, a house with radiant floor heat AND forced hot air will allow you to quickly change the temperature, while also maintaining some nice warm floors!
If you live in the Northeast, you probably don’t have many options when it comes to heating your home. If you’ve got natural gas, you’re definitely one of the lucky ones. Natural gas tends to be an extremely cost-effective way to heat your home. Unfortunately, it’s just not available everywhere. And unless there are subsidies involved, conversion to gas can be costly.
Electric heat and heat pumps tend to work for small condos, apartments, and places with mild winters. But for the rest of us, we have two choices: heating oil and propane.
Propane can be used for many things, including gas fireplaces, generators, and pool heaters. As such, it’s actually not uncommon to have both in a house. I use propane for my hot water, oven, and stove, but oil for heat. Since the heating expenses are the biggest piece of most homes’ overall usage, we will focus on choosing between propane and heating oil to heat your home.
When to Switch Between Propane and Heating Oil
If your home is in need of a new furnace or boiler, that is often the time this subject comes up. The system itself – be it a furnace or a boiler – tends to be the most expensive component involved in the changeover. As such, it becomes a good time to consider the changeover to a new fuel. The factors to consider though are as follows:
The tank: You must consider where to put the tank, and who will own it.
Efficiency and BTUs: While propane is touted as ‘more efficient’, oil actually produces more heat per gallon.
Freedom to Choose a Supplier: Make sure you are able to choose between different suppliers. This will give you flexibility and the ability to negotiate prices.
Believe it or not, this can be the deciding factor for a lot of folks. A good oil tank in a basement can last 30+ years. If yours has plenty of life in it, you may not even consider switching to propane.
On the flip side, if you have propane tanks that are provided by your propane supplier, the cost of buying your own heating oil tank may be a turn off.
There’s also the visual aesthetic: propane tanks are hard to hide. Unlike a heating oil tank, which you can hide in a basement, propane tanks must be outside. This means they are either in view, or must be buried in the ground.
Who Owns The Tank is Critical
The most over-looked factor, however, is WHO OWNS THE TANK. When a company tries to get you to switch to propane, they will always want to provide their own tanks. They will tell you that this saves you money, since you don’t need to buy tanks. In the near term, that may be true. But this also locks you into buying ONLY from them. This eliminates any control you have over pricing, delivery timing, etc. In fact, even if you are fed up with the prices you are paying, it is illegal in many states to have one supplier’s tanks filled by another supplier! The only way to switch propane suppliers if you are paying too much is to have the tanks removed, and have another company install their own. Or pay to have your own tank(s) installed, which is what you wanted to avoid in the first place.
If you’ve got heating oil, you will always own the tank. Whether it is in the basement, garage, or outside of the house, you can use any supplier you want to have the tank filled. This gives you maximize flexibility and keeps you out of an expensive predicament.
Takeaway: If you go with propane, make sure you own the tank to avoid being tied to one company.
Efficiency and BTUs
Folks often look at the price per gallon to determine if propane is less expensive than heating oil. This overlooks two major factors that must also be considered: efficiency, and BTUs. BTUs (British Thermal Units) represent how much heat is generated by a gallon of fuel. Heating oil can generate 138,500 BTUs per gallon. Propane can generate up to 91,500. There is one more factor though, and that is the efficiency of the burner. Modern propane furnaces are often 95% – and sometimes more – efficient. This means that 95% of every gallon of propane is converted to heat. Oil burners, on the other hand, are only 80-90% efficient. We’ll use 85% efficiency for our calculation below:
Propane: 91,500 * 0.95 = 86,925 effective BTUs per gallon
To do an apples-to-apples comparison, we should look at how many gallons of propane are required to produce as much heat as a gallon of heating oil. Since heating oil generates 117,725 BTUs compared to 86,925 for propane, you will need 1.35 gallons of propane for every gallon of heating oil to generate the same amount of heat (117,725 / 86,925 = 1.35). To do an easy price comparison, take the price per gallon of propane and multiply it by 1.35 to see how it compares to the price per gallon of heating oil.
Takeaway: You need 1.35 gallons of propane for every gallon of heating oil.
Your Freedom to Choose a Supplier
Another overlooked factor is the freedom you have to shop between suppliers. With heating oil, there are numerous suppliers to choose from. You can sign up for automatic delivery, and pay a premium if you’d like. Or you can use a site like FuelSnap and comparison shop between several dealers in your town. You can buy oil as needed, and even use a different supplier each time if you’d like.
With propane, it is VERY difficult to price compare. Nearly 95% of propane tanks in the Northeast are owned by the provider. As such, there are so few homeowners shopping for prices, that providers make it nearly impossible to price compare. Don’t believe me? Call five different suppliers and see for yourself. They want to know your total annual usage, whether you own your own tank, whether you want to be on auto-fill or will-call, and whether you want to pay them for a tank monitor. There simply isn’t a ‘price per gallon’ that most dealers will publish or quote. And once you sign up for automatic delivery, you have no say in the price. They keep delivering propane at whatever price they decide, and you keep paying.
The heating oil market is much more competitive, and prices are therefore much more transparent. You can also get a Smart Oil Gauge, and check your oil level from an app on your phone. When you’re low, you can order oil and have it delivered the same day. You don’t need to pick up a phone and call anyone. It’s your tank, and there are plenty of providers.
Takeaway: Propane is very difficult to price-compare. Heating oil prices are much more competitive and transparent.
The Bottom Line: Heating Oil is the Best Value
As of this writing, heating oil prices in CT range from $1.59 to $2.19 a gallon on FuelSnap. Propane tends to be hovering in the $2-$3 range, with some homeowners reporting $4 or higher in some parts of the state. Since you need 1.35 gallons of propane to generate the same amount of heat as one gallon of heating oil, the math tends to be pretty easy here. Obviously this changes over time, but we will have to see a major uptick in oil prices for propane to become competitive.
With all this in mind, be careful when your HVAC provider is selling you on the benefits of switching to propane. In most cases, the main reason is that it is more profitable for THEM. They will provide the tanks, and you will no longer be able to shop around. There is very little competition, and prices are very hard to compare.
On the contrary, there are hundreds of heating oil dealers competing for your business on a daily basis. You can price compare using a site like FuelSnap, and order on your terms. Oil creates more heat per gallon, and can often be delivered as soon as the same or next day.
Finally, you can always have both! You will save money by heating your home with heating oil. Use propane for just the ancillary needs such as the generator and fireplace. And in the end, you will get the best of both worlds.
STAY IN TOUCH
By clicking submit you agree to receive emails from FuelSnap. You may unsubscribe at any time.