The Cost Of Energy

A new furnace an option if you have money to burn

Warmth: There are good reasons to replace a heating system, but rising oil costs might not be one of them.

August 23, 2005|By Larry Carson | Larry Carson,SUN STAFF

Drew Meyers is replacing the 1970s-era furnace in the ranch house he recently moved into with his family of four in Baltimore County - but not because of the spiking price of fuel.

"It's just old and, to me, I don't want the kids breathing any bad fumes or soot," said Meyers, 39, who will take the opportunity to install a new central air-conditioning system in his home near Liberty Reservoir.

But he also hopes to enjoy a respite from the high energy prices with the new, more efficient oil furnace to replace his old one.

Worries about reliability and home purchasers seeking a fresh start are the main reasons the 8.1 million heating oil users in the United States - mostly in the Northeast - replace furnaces, not spikes in energy prices, say energy experts and those in the home heating industry.

One reason: It's hard to calculate long-term savings when both the cost of fuel and the weather are so uncertain.

Experts caution against a hasty investment in new equipment by homeowners suffering from the sticker shock of high heating oil and natural gas prices.

John Cymbalsky, an energy analyst at the U.S. Energy Information Administration, said that, assuming a price of $2.50 a gallon for heating oil, it would take up to 13 years in fuel savings from replacing a 30-year-old furnace to pay for the cost of a new one.

"The real question is how long the 30-year-old unit can be expected to last," he said. If a homeowner expects to replace the furnace soon anyway, doing it sooner will save more money.

The up-front costs of new equipment can be considerable.

Oil furnace replacements can cost from $2,000 to $10,000, depending on the age and size of the house and the need for added work, said John Stover, customer service chief for Catons Plumbing in Catonsville.

Jason Parker, president of Parker Oil Co., said a new furnace might achieve a 15 to 25 percent efficiency improvement, but it's unclear how many years it would take to offset the cost.

Patrick Reeve, general manager for home comfort of BGE Home, said new gas furnaces produce a significant efficiency improvement, and cost up to $2,500, including installation.

"If a gas furnace was from 1982, it probably operated at 60 percent efficiency," he said, while a new furnace would burn 97 percent of the fuel that feeds through its burners.

Still, Reeve said he's seen no spike of gas furnace replacements, or conversions from oil to natural gas. For one thing, natural gas lines are unavailable in many neighborhoods, said John Cymbalsky.

"If you have a really old gas or oil furnace, the new one you can buy [whether oil or gas] is going to be equally efficient," he said.

Rising natural gas prices also are discouraging conversions from oil to gas heating.

Natural gas is predicted to cost 20 to 30 percent more this winter than last, according to Linda Foy, spokeswoman for Baltimore Gas and Electric Co. Energy Department forecasts predict that gas will continue to cost slightly more than oil through 2014.

According to the Consumer Energy Council of America, 5 percent of homeowners need to replace their heating systems each year. Conserving energy by caulking windows, adding insulation and weather-stripping makes more sense, according to the group.

Oil dealers are well aware of the pressure fuel costs are putting on their customers. Carl Hein Jr., the 78-year old proprietor of Hein Brothers in Glen Burnie, said he charges $2.30 a gallon now, compared with $1.95 a year ago and $1.35 in 2002.

"People are starting to realize they've got to start saving energy," he said, and that could include a new furnace.

For now, however, other factors seem to be driving the furnace replacement business.

Ellicott City resident John Sipes is replacing his oil furnace after 45 years, but energy prices have nothing to do with it.

"It's like me," said Sipes, a 73-year-old retired teacher. "It's getting old."

Rather than wait and risk a breakdown on a frigid winter day, Sipes said he's paying $3,500 to replace the oil burner this week, and another $1,500 for an integrated hot water system that warms water for personal use and for a baseboard heating system.

Sipes says he sets his thermostat no higher than 70 degrees in winter and has cut oil consumption to below 900 gallons. He and his wife also are thinking about replacement windows.

"I don't like to throw money away," he said.

Drew Meyers, meanwhile, sees greater efficiency as a plus, but it's not his main reason for replacing the furnace. He just wants to start his life there with new equipment, he said.

"Is [fuel efficiency] going to pay for the system? No," he said.

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