Comparing Price: Gas Furnace Vs. Electric Heater

While natural gas remains the widely-used home heating fuel in the U.S., this type of fuel may not be available in every area. Homeowners without access to natural gas lines or those who prefer a different type of home heating fuel may turn to power to power house heating systems. Despite its high efficiency, electric heat often costs more to operate than a conventional gas furnace. When comparing a gas furnace to an electric heater, consider not only the upfront and operating costs of each option, but also how these systems impact the environment.

Equipment Prices

The typical cost for a new gas furnace ranges from approximately $2,300 to $3,000 based on manufacturer according to a November 2012 post by Consumer Reports. estimates the price of a new electric furnace at $1,000 to $1,500 as of December 2012. Electric space heaters are available for much less at most home improvement stores. While the upfront costs of electric heating may seem lower than those connected with gas heating, operating costs for gas heaters are often substantially lower than those connected with electric heat.

Factors That Influence Heating Costs

The cost of operating any heat process is determined by four factors, including the type of fuel, the price per unit of fuel, the amount of heat supplied per unit of fuel, and also the efficiency of the heating system. The total amount of heat is measured in British Thermal Units — or BTUs — while the efficiency rating are available by checking the annual fuel utilization efficiency. The University of Maine suggests with this formula to figure heating costs: price per unit times 1,000,000 BTUs/BTUs per unit/efficiency. This formulation gives you the fuel price of 1,000,000 BTUs of heat. The typical house requires 50,000,000 into 150,000,000 BTUs of heat every single winter in accordance with the U.S. Department of Agriculture.

Calculating Heating Costs

In 2011, the typical residential customer in the U.S. spent 11.7 cents per kilowatt hour of power in accordance with the U.S. Energy Information Administration. The EIA also reports that every kilowatt hour of power supplies about 3,412 BTUs of heat. According to the U.S. Department of Energy, Electrical furnaces provide annual fuel utilization efficiency — or AFUE — ratings of 95 to 100 percent. Electric space heaters have AFUE ratings of 100 percent. Presuming an electric heater using 100 percent efficiency, homeowners should expect to pay about $34.32 per million BTUs of heat. Natural gas is generally offered in therms, where a single therm is equal to 100,000 BTUs. The EIA reports that one therm costs about $1.01 as of November 2012. Gas furnaces from the U.S. must have a minimum AFUE of 78 percent, though this amount can go much higher. Assuming a furnace having a 78 percent efficiency, consumers should expect to pay about $12.96 per million BTUs of heat. While costs for gasoline and power fluctuate over time and by area, gas furnaces typically cost much less to operate than electric furnaces or heaters.

Environmental Costs

While the price of purchasing and operating a new chimney frequently tops the list of concerns for shoppers, it’s also important to take into account the environmental costs of all the heating choices. Despite the relatively higher efficiency of the majority of electric heaters, electric heat is inherently ineffective. According to the U.S. Environmental Protection Agency, most power is produced using techniques which are only 30 percent efficient. In addition, coal represents one of the primary fuels used to produce electricity. While natural gas production does discharge greenhouse gas emissions and other pollutants, this gas burns much cleaner than coal and also poses much less harm to the environment, according to the EPA.

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