Should You Be Heating with Electricity?

For many people in the US, the answer is now "yes" even if the only electric alternative available to them is electric baseboard heat. If you expect to pay $5.00/gallon for heating oil this winter, then you are better off heating with electricity if your local utility is going to charge you $.1575 per kilowatt-hour or less so long as the utility doesn't have peak usage penalties. All my data comes from a useful Energy Department spreadsheet available at http://www.eia.doe.gov/neic/experts/heatcalc.xls.

Last winter we paid $.15157 in my hometown of Stowe, Vermont so we're right on the cusp. That rate'll go up but probably not as fast as the cost of oil. We do have peak usage penalties in Stowe which would currently make heating with electricity here prohibitive, however.

The magic number is 31.75! If oil costs more than 31.75 times as much per gallon as electricity does per kwh, then even electric baseboard heat is cheaper than heating oil. UPDATE: a tool for estimating how much you might save annually by switching to electric heat is here.

Interestingly, we have the option of easing into this alternative. Electric space heaters also beat out oil at this ratio of prices. You can buy a couple and use them to top off the heat in the rooms you are actually in while keeping the furnace at a lower setting for the whole house. There is usually an additional saving here because most of us who heat with oil can't control temperature on a room-by-room while this is easy to do with electric space heat.

If you are building a new house or considering replacing your heating system altogether, then you want to look at an electric heat pump. People with wells (a lot of us in rural areas, few in urban areas), should consider a geothermal heat pump: it breaks even with $5.00/gallon oil at $.52/kwh – way above the rates most of us pay for electricity (more on geothermal here). The efficiency of an air-source heat pump for heating depends on the average outdoor temperature. In Vermont, an air-source heat pump breaks even with $5.00 oil at about $.225/kwh. In balmy New York City, the air-source heat pump breaks even at $.30/kwh.

In many parts of the country building codes were written or electric rates set to discourage the use of electric heat. Times were different then. Even if we disregard the possibility of anthropogenic global warming, electric heat makes sense for more and more of us. Those building codes need to be changed; those electric rates need to reflect the new reality.

But there's a hitch: we don't have enough electric capacity everywhere to support a massive switch to electric heat from oil. In Stowe, we're running out of electrical capacity; it's taken years to clear all the obstacles to bringing increased power into our area. The project still hasn't been built. Building power lines is going to be an important part of energy independence. Environmentalists like me are going to have to support these projects rather than look for reasons to oppose them. NIMBY cannot lock us into dependence on expensive imported fossil fuels.

Comments

[Steve Terry]

Tom: I liked very much your comments on electricity issues. I am wondering if I can interest you in meeting with Mary Powell, the in-coming CEO at GMP, soon to talk about some ideas GMP has on Vermont's Energy Future. Mary has lead a very interesting strategic effort that lays out a Vermont vision that you may find of interest because it touches on many of the issues you have raaised.
Give me a call at 802-655-8408, or just e-mail me back at Terry@greenmountainpower.biz

[Tom Evslin]

Rob:

There IS more heat in the ground water than the air. The more efficient the electric heat source the HIGHER the electrical cost it breaks even at. So radiant heat breaks even around $.15kwh,air sopurce heat pump @ .22, and geothermal heat pump at over fifty. Converse is that the more efficient the electric heat source, the MORE competitive it is against oil. It took $5/gallon oil for radiant heat at Stowe prices to break even with oil; geothermal was laready more than competitive when oil was at $3.00.

[Rob]

I am surprised that the geo thermal heat pump breaks even at so much higher electric rate. I would assume that in the dead of winter there is a lot more heat in ground water then in the air, assuming heat conversion ratio is the same does the water pumping cost make it 2x or are the air based numbers assuming average year round temp? From looking into heat pumps a decade or so ago, they performed very poorly (might as well use radiant heaters) when the ambient temp is below 40, and i would bet you winter temps are pretty much always below 40, while the well water is always in the mid 50s?

[candice]

Tom, have you run any numbers against natural gas heat? Here in the south (New Orleans) where it's only cold a few months of the year we all have natural gas and worry about energy costs only in the summer with AC. I do know a couple of people with geothermal, though. And people who have room-by-room gas heat; the house I live in now was once set up for it, but someone put in a furnace in the 70s.

But, there are more natural gas wells within 100 miles of where I am now than anywhere else in the country, so this view of "natural gas is cheap" is likely skewed.

[John R Hall]

Another advantage with portable electric radiant-type heaters is that you can target the heat even more precisely than room-by-room.