How do I compare the cost of heating fuels?

The efficiency of the fuel itself needs to be considered. This is also known as combustion efficiency. During combustion, there is a percentage of how much of the fuel is converted into useful energy, how much is wasted heat, and how much is bi-products (also known as emissions).

Each fuel type has a different efficiency. Here are the most common conversions:

• 1 gallon of finished motor gasoline (containing about 10% fuel ethanol by volume) = 120,238 Btu
• 1 gallon of heating oil (with sulfur content at 15 to 500 parts per million) = 138,500 Btu
• 1 cubic foot of natural gas = 1,039 Btu
• 1 gallon of propane = 91,452 Btu
• 1 short ton (2,000 pounds) of coal (consumed by the electric power sector) = 18,934,000 Btu

You can also find a fuel to energy conversion calculator on EIA.gov.

If you are comparing two different system types that use different fuels, you will need to find the following values:

• Cost of the fuel
• Fuel Conversion Factor
• Efficiency of the system

Let's give an example. 

You have a boiler that can run on either natural gas or oil. Using natural gas at $0.62/Therm, the boiler is 73% efficient. Using oil at $2.30/gal, the boiler is 77% efficient. 

Which fuel has the lowest operating cost?

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Now that we have the cost of energy in the same units, it is easier to compare oil against gas. The cost of oil at $8.49/ MMBtu is less than $21.65/MMBtu, and therefore has a lower operating cost.