Calculating the Cost of Gas Vs. Electric Heating

The trees are just starting to turn and with it my thoughts turn to figuring out how to heat the house before icicles start hanging from my nose. Panic has no   t set in as of yet, but time sure does fly!

If you are a follower of the journal, you are already aware that a fraction of the heating will be supplied by the solar collectors. At this point, it’s anybody’s guess as to how well the system will perform, but the house will be enclosed and insulated by the end of November. The interior cordwood walls still need to be constructed, but the house will be sealed and insulated, providing energy efficiencies beyond a standard stick frame house.

To refresh everyone’s memories (including myself), there are three heating systems that will heat the house: hydronic solar, wood stove and (utility supplied) radiant floor heat. Whenever the sun is shining, the hydronic solar heating system heats an insulated sand bed under the floor. The key word in that sentence is “whenever”. Especially during the months of November and December it can stay cloudy for extended periods of time and for that reason, there has to be other forms of heat energy. Wood heat is another form of renewable energy and when I’m working on the house, I won’t be shy in using the soapstone stove. But, there needs to be a backup system too. When the floor was poured, 1,200′ of 1/2″ pex tubing was installed right in the concrete. This is a separate system from the solar hydronic system and will provide supplemental heat to keep the house from getting too cold. The question is: “What form of energy do I use to provide this extra heat when I need it? Do I use electric? Do I use LP gas? Both?

Warning: If this kind of “geeky” stuff puts you to sleep, beware that the next section of this journal is going to put you into a deep sleep. If you are driving while reading this, put down your laptop computer immediately.

 

I have been racking my brain over what form of heat I should use and I figure it’s best for me to put this down in writing for my own gleanings and if you care to share in this torture, read on…

Since I have the “luxury” of using electric and/or gas, there are a number of issues that have to be taken into consideration:

What is the break even point for the cost of the fuel?
What kind of heat loss will I have?
What is the cost of the boilers and is there a pay back in efficiency (Return on investment)?
What kind of plans are offered by our fine utility companies?

Fuel Costs – Break Even Point
As many are painfully aware, the cost of gas can fluctuate wildly, especially during the heating season. Electric rates are more stable, but will change on occasion. What is constant though is how many Btu’s are generated from a gallon of LP gas and how many Btu’s are generated per kilowatt of power. With that in mind, we can figure out to the penny which form of energy is going to be more cost effective. What we’re after here is the break-even point based on the efficiency of the gas boiler and the costs of the fuels.

 

Here are the constants that will be used to figure fuel costs:

1 gallon of LP gas generates 91,800 Btu’s.
1 kilowatt generates 3,412 Btu’s.

(Thanks to Steve Krug for supplying the numbers.)

Now the crux to those two values deal with boiler efficiencies. LP gas boilers do not operate at 100% efficiency while electric boilers (for the purpose of this discussion) do. (We won’t go into the inefficiencies of power plants at this point as I’m afraid my hands will cramp up.)

Let’s do a few examples here:
If I buy my electric power at .07 per kilowatt, that means that I pay 7 cents for 3,412 Btu’s.

If I buy LP gas at .84 per gallon, and have a gas boiler that operates at 85% efficiency, I pay .84 per 78,030 Btu’s. (91,800 x .85 = 78,030)

Since the gas figure has a higher number of Btu’s, let’s figure out how many kilowatts it is going to take to equal the number of Btu’s per gallon of gas. To do this, divide 78,030 by 3,412. The answer is 22.87.

If you then take 22.87 and multiply it by .07, the break even point is $1.60 per gallon of LP gas. That’s a no brainer! Electric is almost twice as expensive than the price of LP gas at .84 per gallon.

In the second example, the electric company offers a discount rate of .035 for off-peak hours. In this case, 22.87 multiplied by .035 equals .80 per gallon, meaning that if the price of gas is more than .80 per gallon, electric is less expensive and in this example, that is the case: 80 cents vs. 84 cents.

In the third example, the electric company offers the same discount rate of .035/kW but we now are using a high efficiency Polaris gas boiler. It has an efficiency of 94%. The Polaris gets 86,292 Btu’s per gallon (91,800 x .94). If we then divide 86,292 by 3,412 we get 25.29. 25.29 multiplied by .035 equals .88. In this case, the break even point is 88 cents per gallon and it is less expensive to heat with a high efficiency gas boiler.

As you can see, there are three variables at play here: the price of LP gas, the price of electric, and the efficiency of the gas boiler.
Just one more outer wedge to go and then it’s on to the inner circle. I’m probably a bit more than half way done.

Heat Loss Calculation
For those of you who are sadistic and have read through every single journal entry, you might recall that I did a heat loss calculation on the house a few years back. Of course, this is all theoretical, but what the heck at least it is an educated guess. Here’s what I stated: “The calculations were done based on an outside temperature of -20F degrees and an indoor temperature of +70F degrees. Insulation values for the house were used as follows: double cordwood wall (~R37), ceilings (~R55), windows (R3) and doors (R5). Heat loss through the footings and the heat loss of air infiltration were also taken into account. The end result was a heat loss of ~25,000 Btu/Hr. for a worse case scenario.”

The heat loss calculation that I did was based on John Siegenthaler calculations — a known expert in the industry. It requires filling out a form that takes into account a number of factors from R-values to air infiltration.

The result of 25,000 Btu/hr. is an estimate of course, but it helps size the boiler required to heat a house in very cold conditions. Most LP gas boilers provide anywhere from 30,000 Btu/hr. on up to well over 100,000 Btu/hr. while electric start out a bit smaller in size. You want to size a boiler that is slightly higher in Btu output than your worse case scenario.

Boiler Costs
We’ll start with the easy one here…electric boilers can be purchased through our local electric co-op at their cost:

9kw….$520…. warm-flo*…..$580
13.5kw….$865…. warm-flo*….$1,155
18kw….$965…. warm-flo*….$1,235

*The warm-flo feature comes with the flexibility to turn on the heating elements in increments based on the demand. They’re pretty straight forward and take up a small floor footprint. Some models are wall mountable to boot.

As far as gas boilers, I’ve been looking at SlantFin, Polaris and now “Munchkins”. All have different efficiencies and range in price from $1,500 on up over $2,000. Most models put out way too many Btu’s—more than I will need. That’s not necessarily a negative, but generally the larger boilers cost more.

If I was certain that over the next 10 years or so, I could consistently get a better price per Btu with gas than electric, I would buy a high-efficiency gas boiler, but the future price of LP gas is an unknown, plus the amount of heat I need is on the low end due to the efficiencies of the house as well as the fact that the house is partially heated by the sun. To answer the question of pay back is dependent on the house heat loss calculation and what plans are offered by the utilities. In our own case, it is difficult to justify an extra $1,000 cost in a high efficiency boiler for a net gain of $30-50 per year IF the price of LP gas is lower than electric.
Another view from up on the ladder.

Utility Costs
For LP gas, a 500 gallon tank can be leased for $1.00 (lifetime) plus a modest installation fee which includes a gas line to the house. No matter what form of heat we decide upon, we will be using LP gas for cooking, clothes drying (when not using a clothes line) and a solar assisted tankless water heater. Summer rates for LP gas were around .75 per gallon, while winter rates are now at .84 per gallon cash and .89 on credit.

Tri-County Electric has a dual fuel program that if you meet their criteria, you can purchase off-peak electricity at 3.5 cents per kilowatt. The criteria requires you to have a backup fuel for heating your house. I threw them a curve ball when I mentioned that solar was one of my heat sources. It took some deliberation before I got an answer to whether solar would be considered. It ends up that there is a liability issue here. They want to make sure the homeowner has some other reliable source of heat in case they have to divert power in case of an emergency. They do not want to be accountable for damage caused by frozen water pipes, etc. To make a long story short, I was able to convince them that it would have to be a long, extended period before the temperature in the house dipped below freezing. (I got the green light from them earlier this week.)

Here’s how their service works: A wireless control is put on the outside of the house along with a separate meter to record electric usage at the lower rate. Tri-County turns the power on and off to this circuit based on the time of day. In our case, power will be available from 9:30 at night until 5:30 in the morning, give or take an hour on either side. Roughly, there’s an eight hour window of usage overnight. There are also two other “windows” of time during the day that the power is turned on for two hours. Interestingly, they suggest a sand bed under the floor to store the heat so the house never drastically cools off during nonuse hours. Sound familiar?

To put in this special circuit, meter and wireless transceiver will cost between $200 and $300 (electrician’s fee), plus $3.00 per month for the second meter rental.

To summarize things, our house will use both electric and LP gas for various needs. Plans are to install a solar electric, grid intertie system once the house is built. (I hate having to consider battery maintenance and it costs just about the same to be tied into the grid as it would to purchase and maintain a bank of batteries.) Based on the current costs of fuel, we will take advantage of the dual fuel program from Tri-County Electric, but leave our options open in case rates change in the future. (A 6″ pipe mortared into the cordwood wall is ready for venting an LP gas boiler if and when it might be required.)

Heating:
Solar hydronic – under-floor sand bed
Electric hydronic radiant floor heat
High efficiency wood stove

Domestic Hot Water:
Solar hydronic
LP Gas – Aquastar 125S (Solar assist) tankless heater

Other:
LP Gas Cook Stove
LP Gas Clothes Dryer (When not using clothes line)