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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?

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.