Every fuel source and technology claims to be the best.
How can you evaluate these claims?

The basic four elements of fuel efficiency and cost:

There is no simple "best fuel". Every fuel or energy source needs to be converted into heat. Every fuel has a different capacity to create heat. Oil is 5X better at producing heat, but gas is generally 5X cheaper per volume, so you can't look at one without the other. In the end, utility companies will try to balance their fuel costs to match the prevailing rates of oil, so you have to look beyond simple price per unit to understand your own costs, and whether you can save more by upgrading your current system or converting from oil to gas, etc.

There is a machine, device or technique to turn your fuel into heat (we'll call it a system). The system could be running at any level of efficiency. If the system is 10% efficient, it is losing 90% of the fuel source and only producing 10% into heat. You must know the efficiency of your system before you know how much fuel is being consumed to produce heat, or cooling. This is Step #1, to know your system efficiency.

Step #2 is to determine what unit of measure your fuel source is quoted or charged in. It could be by the gallon, by the therm, by the kiloWatt/hour, or some other unit of measure. You then need to know how to convert that unit to a common unit so you can truly compare apples to apples when looking at fuel sources. In other words, you could convert all units to BTUs (a measure of heat produced), or kiloWatt/hours (a measure of power). It doesn't matter what unit you use, as long as you prevent being confused by gallon versus therm, etc.

Step #3 is to identify any non-fuel costs that are involved in your billing. Gas, for instance, is never charged simply by the therm or kiloWatt/hour, or any single unit. Gas delivery typically has a complicated formula and includes monthly service charges, delivery charges, initial therm use discounts, overuse surcharges, and a host of other possible charges. Gas companies quote the therm price to you, typically, but that has NOTHING TO DO with the price you pay for gas every month. In Massachusetts, for instance, even in a non-heating month, service and other charges can amount to $30-$40 just to keep gas connected to your home. Many people mistakenly multiply therms by price to come to the conclusion that gas is cheap, but they must instead factor those other charges into the bill to raise the cost per unit to really know what they are spending. Contrast that with oil, where the cost is simply the gallon price times the number of gallons purchased.

Step #4 is to consider payback on any investment that you make. Every change or upgrade costs money. You need to be able to actually track your costs in the future to see your payback. You need to know anticipated savings to decide whether the change is worth it. Converting from oil to gas will cost thousands of dollars. Adding a wood pellet burning capacity can cost a lot of money but if you are willing to feed the wood pellet burner, you can save a lot. But how much?

Summary:

The cost per unit of fuel has little to do with your actual heating cost. The cost per barrel of oil on the commodities market, the quoted cost per therm of the gas company, or the cost for a gallon of propane, all have little to do with your actual heating cost. Until you factor in your system's technology and efficiency and non fuel charges, you can't really know if a change that you are considering will save money or not.

When considering upgrades, conversions or replacement to your system, you need to know what the anticpated savings will be, and be able to track it, to know how much you actually save.

You know what you want: The lowest overall energy costs, year after year, regardless of the market prices for fuel. Nobody can help you achieve that goal better than Ranco Enterprises! We look at all the above factors as they relate to your home or commercial building, and show you clearly on paper what you best choices are.

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