|
Conservation makes more sense than Switching from
Oil to Natural Gas. |
|
|
|
Exploring Energy Choices |
In response to the
recent upturn in energy prices, the Consumer Energy
Council of America (CECA) has issued a report
comparing the economics of switching fuel sources
versus investing in conservation. The findings in
this study concur with the findings of the four
previous fuel switching studies conducted by CECA.
This study concludes that it is financially unwise
for consumers to convert from oil to gas heat. In
the 95 our of 100 cases where consumers do not need
a new heating system, it makes economic sense to
stick with oil and invest in conservation. For the
5% of consumers who need to replace their oil
heating systems, a careful assessment of conversion
costs must be made. |
|
|
|
Price
Parity: Comparing Oil and Gas Prices |
|
In order to compare
conservation and equipment investment options, CECA
examined the relative prices of heating oil and
natural gas. Although Northeast and Mid-Atlantic oil
prices (where the majority of heating oil is
consumed) have been lower than natural gas for the
last 8 years, this study has been based on price
parity between the fuels. |
|
|
|
What
about Future Prices? |
|
If historical data can
be deemed a good indicator of future market
conditions, heating oil prices should continue to be
less expensive than natural gas. Therefore,
conservation techniques will continue to benefit
homeowners more than switching fuels. |
|
|
|
Deciding Between Investment in Conservation or Fuel
Switching |
|
To determine the
effectiveness of energy conservation for your home,
you must consider your annual fuel usage. Our table
measures rates of return for an "average" use home
(865 gals. heating oil/year) and for a "low" use
home (623 gals. heating oil/year). For above-average
use homes, investment returns will be even higher
than estimated. |
|
|
 |
