Natural gas has replaced fuel oil as the main source of energy used by heating systems in New York. There are many economic and environmental reasons why replacement makes sense, and this article will explain five of them.
Ideally a boiler upgrade project should be complemented with improvements to the building envelope to reduce the heating load – up to 25% of the heat supplied to a building can be lost due to poor envelope performance. Automatic controls are also recommended as they can reduce the operating cost of a heating system by up to 10%.
1) Natural Gas Reduces Heating Expenses
The US Department of Energy conducted a study on home heating expenses between 2007 and 2012. They determined that the average US home spends $1,700/year on heating when using fuel oil, but only $700/year with natural gas. In other words, savings of up to 60% can be expected after a fuel conversion.
New York City is located in the Northeast, where natural gas is more expensive than in other parts of the US. However, there is still a cost advantage over heating oil.
- In 2017, No. 2 fuel oil was priced at 278.4 cents per gallon in New York.
- However, the price of natural gas is $16.11 per MCF (thousand cubic feet).
In terms of heat content, a gallon of #2 fuel oil contains 1.385 terms, while an MCF of natural gas contains 10.37 terms. After some math, the cost per term in New York is as follows:
- #2 Fuel Oil = ($2.784/gal) / (1.385 thermal/gal) = $2.01/thermal
- Natural gas = ($16.11/MCF) / (10.37 therm/MCF) = $1.55/therm
In terms of cost per unit of heat, natural gas is about 25% cheaper than No. 2 fuel oil in New York. Assuming both boilers have the same fuel efficiency, running the natural gas boiler will be 25% cheaper. The savings are even greater if an old, inefficient oil boiler is replaced with a modern ENERGY STAR gas boiler, for example.
Energy savings can be increased even further if the new gas boiler has a lower heating output than the existing oil boiler. Old heating systems are often oversized and the heating load can be reduced before upgrading the boiler, improving the building envelope.
2) Simpler logistics and maintenance
Remember that Con Edison has a natural gas distribution system, but the heating oil must be delivered by truck to the point of use. As a result, natural gas is readily available to homeowners, but in the case of heating oil, someone must schedule deliveries and control fuel levels.
Also due to the lack of utility service, heating oil requires a large storage tank that requires frequent maintenance. Heating oil also releases more particles during combustion, which can clog system components if left unattended: an oil boiler is more demanding in terms of maintenance compared to an equivalent system using natural gas.
3) Environmental Management
Fuel oil is a highly polluting heat source: only about 1% of New York's buildings still use it, but its total emissions are greater than those of all of the city's vehicles combined. According to the US Energy Information Administration, heating oil emits 161.3 pounds of CO2 per million BTU, while natural gas emits 117 pounds of CO2 per MMBTU – a 27% reduction in CO2 just the emissions. Other pollutants emitted in large quantities during the combustion of fuel oil are particulates, nitrogen oxides and sulfur oxides. As it is a fossil fuel, natural gas also emits them, but in lower concentrations.
The reduction in emissions when converting oil to natural gas is enhanced if the new boiler has high efficiency. The building will not only use a fuel with reduced emissions, but it will also use less fuel.
4) Con Edison Incentive
Con Edison manages an incentive program for homeowners who upgrade their heating systems from oil to natural gas. Three different conversion discounts are available, each for a different type of property:
- Residential properties of up to four homes are eligible for a $2,000 conversion discount and an equipment discount of up to $1,000.
- Multifamily buildings (5 to 75 homes) receive a conversion discount of $300 per home, plus an equipment discount of up to $17,500.
- Large commercial properties and multifamily buildings over 75 units receive a $10,000 conversion discount and a $15,000 equipment discount.
It is important to note that financing is limited per year and Con Edison closes the application once the rebate capital has been fully allocated for the corresponding year. Owners who apply for the rebate may contact a qualified engineering firm to ensure their equipment is eligible, as there are several performance requirements that must be met.
Both boilers and furnaces are eligible for the rebate if they are powered by natural gas and replace a petroleum system. However, if the equipment is configured for dual fuel operation, it is not eligible; the unit must operate exclusively on natural gas.
5) Reliability
When New York was hit by Hurricane Sandy in 2012 , the natural gas distribution system continued to operate almost without interruption. Supplying heating oil may be impossible under emergency conditions, but natural gas-fired heating systems can continue to operate normally.
Natural gas becomes even more useful if a property is equipped with a gas-powered electrical generator. This guarantees space heating and electricity even in adverse weather conditions, as long as the gas supply remains operational. It is important to note, however, that major equipment must be installed above the reach of floodwaters for this approach to work.
In addition to technical reliability, natural gas also offers reliability in terms of costs. Although heating oil prices have increased in recent years, the trend for natural gas is a decrease in prices.
Conclusion
There are technical, financial and environmental reasons why it makes sense to switch from heating oil to natural gas. However, professional services are recommended to obtain the best results, as with any engineering project.
