As winter approaches home owners naturally think about what the costs will be to heat their homes. This is also on buyers minds as they look at prospective homes - the number one question realtors get asked when a home is heated with fuel oil is "is there gas on the street?" Hard numbers on heating fuel prices are readily available but a detailed comparison is harder to come by. As the MA Properties Online team takes a 'data driven approach' to real estate this newsletter will do the comparison for you.
Homes in Massachusetts are heated with a number of fuels so we'll focus on the main ones: natural gas, fuel oil, electricity, propane and wood pellets. The latest pricing data is available on the Energy and Environmental Affairs section of the mass.gov website. For electricity and natural gas costs we used the latest prices for NSTAR (electricity) and National Grid (natural gas).
Here are the prices for November 2014:
|Fuel Type||Fuel Price||Fuel Unit||Notes|
|Natural Gas||$1.03||Therm||Supply + delivery charges|
|Wood Pellets||$318.5||Ton||Average for premium and super premium pellets|
|Electricity||17.8 cents||KWh||Generation + delivery charges|
The costs comparison converts all costs to $/BTU and factors in an efficiency rating for various heating appliances. The calculations to do this came from the US Energy Information Administration (EIA). As you look at this data remember that your fuel prices may differ from the prices listed above (perhaps because you pre-ordered fuel oil) and the efficiency of your heat appliance may be different (in general, more modern appliances will have a higher efficiency). The EIA estimates that the average usage in MA is 109 million BTU (this is for a 2,076 sqft single family home - so your usage may differ if your home is significantly larger or smaller than this).
|Fuel Type||Fuel Price||Fuel Unit||Heating Appliance Type||Approx. Efficiency||Fuel Cost / Million BTU||Average Fuel Costs MA|
|Natural Gas||$1.03||Therm||Furnace or Boiler||82%||$12.54||$1,366.59|
|Room Heater (Vented)||65%||$15.82||$1,724.01|
|Room Heater (Unvented)||100%||$10.28||$1,120.60|
|Wood Pellets||$318.5||Ton||Room Heater||78%||$24.75||$2,697.47|
|Fuel Oil||$3.33||Gallon||Furnace or Boiler||78%||$30.78||$3,355.29|
|Propane||$3.13||Gallon||Furnace or Boiler||78%||$43.94||$4,789.02|
|Electricity||$17.8 cents||KWh||Furnace or Boiler||98%||$53.23||$5,802.45|
If we show this graphically (using the furnace/boiler data) we see the clear advantage of natural gas over all the other fuel types.
Given this data what can current or prospective home owners do to reduce their heating costs?
A good place to start is to get a Home Energy Assessment. This assessment looks at all aspects of your home's energy usage and (just as important) wastage. It will look at major mechanical systems (heating and cooling); insulation and air leakage; lighting and appliances. Look at the Online Home Energy Assessment section on the Mass Save website for details. Many utility companies also send a usage comparison report to all households and this gives a useful comparison tool when compared to similar homes in yur neighborhood.
Assuming there is "gas on the street", what is the approximate cost of converting from fuel oil or propane to natural gas? Part of this is easy to answer - if you are served by National Grid there is a fixed cost to bring the gas line into the house from the street (although there is a caveat if the distance is too large). The other things to consider are the costs of converting/replacing the furnace and converting/replacing the range. We recently helped a client looking to convert a home heated by propane to natural gas and the approximate costs were:
|Bring natural gas line into the house from the street (National Grid)||$1,300|
|Convert propane furnace and gas fireplace to natural gas||$2,000|
|New range (existing range was electric)||$500|
Your situations may be different and so there will be more things to consider and therefore additional potential costs - but this will give you an "order of magnitude" cost for a propane conversion.
There are also a number of rebates that you may be eligible for (the NSTAR website lists a few of these):
It's more complex if you have a fuel oil furnace - at a minimum you will need to replace the burner, and many older models simply can't be upgraded. So, you'll need to talk to a specialist to see if your existing furnace can be converted. One other thing to consider if you have to replace your furnace - should you move to an on-demand hot-water system? So, lots to consider when you look into conversion and naturally the costs for converting your home will differ from the numbers I provided above.
The last comment on this - have you looked into Solar Heating (there are over 100 installations in Lexington)? It's too much to cover here and so we will devote a complete newsletter to this topic in the coming months.
Energy and Environmental Affairs section of the Mass.Gov website www.mass.gov/eea/energy-utilities-clean-tech/home-auto-fuel-price-info/
Home Energy Assessment section of the Mass Save website www.masssave.com/residential/home-energy-assessments/about-home-energy-assessments/what-is-a-home-energy-assessment/
NSTAR conversion information website www.nstar.com/residential/account_services/gas_heating/heating_equip/convert.asp
US Energy Information Administration (EIA) www.eia.gov/
Wood Pellet prices www.woodpelletprice.com/
If you would like an estimate of what your home would sell for in today's market I would be more than happy to come by, have a look at your home, and then provide a CMA (comparative market analysis) which will provide you with an estimate of what your home should sell for, along with a marketing plan to get maximum exposure for your home.
If you'd like to chat more about the topic presented here, or the Real Estate market in general, then please call me on (617) 997 9145, or email me at Dani.Fleming@MAPropertiesOnline.com.