According to Morningstar, the 5-year average of the Dow Jones is 3.06%.
Can I go back and crow about my Thermos again? No, I probably shouldn't -- even though my thermos investment spanks the Dow Jones in the butt. But as far as blogging goes, I've beaten my thermos to death, so to speak, and I can't save more money by buying more thermoses (thermosii?).
Still, payback time has been on my mind lately. We're contemplating a switch from our oil burning furnace to some form of gas. We've gotten an estimate for a handful-of-thousand-of-dollars to convert our oil burner to a gas burner. At that price, my best guess is that payback time would be 2-3 years. We've also been shopping around for ripping out the oil burner entirely and replacing it completely with a new high-efficiency gas burner. The prices and payback times are still murky on that one.
Either way, it's a lot of money to pull out of active duty from our savings account. Unlike the thermos (there I go again), this isn't pocket change. And it seems reasonable to wonder, Is It Worth It?
There's a lot to that "Is It Worth It?" question. Several years ago, we spend oodles of money on insulating our home. By "oodles", I mean "a heck of a lot". To me, because I'm an eco nut and also because sealing up the home contributed mightily to the general comfort, there were strong non-financial reasons for doing this. But financially, it made much less sense. The insulation and sealing will, in our particular case, take about 67 years to pay for itself -- hardly a bargain. (Although perhaps I'll appreciate it once I'm 115 years old).
The thermos . . . dang. Okay, can't leave it alone. The thermos rocks on both the environmental (use less energy) AND on the financial scales. Switching to natural gas is ethically vaguer for me. On the one hand, we'd be importing less oil from overseas; on the other hand, we'd be fracking our neighbors. This is still something I have to mull.
But financially -- pure dollars and cents -- that's an easier computation. It's the kind of thing to die for, for a person who loves calculus and who can compare linear and exponential graphs. (Um, that would be me). A payback time of 2 years will eventually beat any interest rate of 20% or lower. A payback time of 3 years beats any interest of 13% or less. In other words, financially speaking, we should go for it.
Tomorrow, for the truly geeky, I'll compare payback times and savings rates, just in case you have your own financial outlay to consider.
Can I go back and crow about my Thermos again? No, I probably shouldn't -- even though my thermos investment spanks the Dow Jones in the butt. But as far as blogging goes, I've beaten my thermos to death, so to speak, and I can't save more money by buying more thermoses (thermosii?).
Still, payback time has been on my mind lately. We're contemplating a switch from our oil burning furnace to some form of gas. We've gotten an estimate for a handful-of-thousand-of-dollars to convert our oil burner to a gas burner. At that price, my best guess is that payback time would be 2-3 years. We've also been shopping around for ripping out the oil burner entirely and replacing it completely with a new high-efficiency gas burner. The prices and payback times are still murky on that one.
Either way, it's a lot of money to pull out of active duty from our savings account. Unlike the thermos (there I go again), this isn't pocket change. And it seems reasonable to wonder, Is It Worth It?
There's a lot to that "Is It Worth It?" question. Several years ago, we spend oodles of money on insulating our home. By "oodles", I mean "a heck of a lot". To me, because I'm an eco nut and also because sealing up the home contributed mightily to the general comfort, there were strong non-financial reasons for doing this. But financially, it made much less sense. The insulation and sealing will, in our particular case, take about 67 years to pay for itself -- hardly a bargain. (Although perhaps I'll appreciate it once I'm 115 years old).
The thermos . . . dang. Okay, can't leave it alone. The thermos rocks on both the environmental (use less energy) AND on the financial scales. Switching to natural gas is ethically vaguer for me. On the one hand, we'd be importing less oil from overseas; on the other hand, we'd be fracking our neighbors. This is still something I have to mull.
But financially -- pure dollars and cents -- that's an easier computation. It's the kind of thing to die for, for a person who loves calculus and who can compare linear and exponential graphs. (Um, that would be me). A payback time of 2 years will eventually beat any interest rate of 20% or lower. A payback time of 3 years beats any interest of 13% or less. In other words, financially speaking, we should go for it.
Tomorrow, for the truly geeky, I'll compare payback times and savings rates, just in case you have your own financial outlay to consider.
Here's my input: Natural gas burns so much cleaner than oil, you'll also save in time and materials to keep your house clean (not the clutter but the walls, windows, etc.).
ReplyDeletei think we're leaning pretty heavily in your direction. Still, before we plunk down money, I need to do a bit more research . . . I'd like to do some comparison shopping, for one thing. Thanks for the input! -- MM
DeleteHave you made up your mind, MM? The main concern I can see with your pending conversion to a gas furnace burner is the cost of the system itself. Then there would be monthly fees and user fees. But the thing about natural gas furnace is it is capable of heating air to a higher temperature with less energy used, thus charging you less on your electricity bills. It can actually save you more money overall. But if you intend on being an oil furnace user, I suggest you buy the more modern devices because they promote clean burning. ;)
ReplyDeleteWe are already hooked up to gas for other reasons (a long-defunct hottub, the stove, etc). And as of mid-September, we've signed the contract to do the switchover. We're waiting to hear back from the company we've signed on with. Updates will occur! - MM
DeleteThat’s nice to hear, MM. :) I’ve tried using a gas and an oil furnace as well. And currently, I’m with a gas furnace. I’m enjoying it since it can work both the central and water heating and still go well with my finances. But the thing that really made me stay is the safety. I mean, it will give off a different scent once there are leaks, making it easy to detect.
DeleteFunny you should mention safety! My neighbors did this last April, and the City did a massive inspection/paperwork drill requiring detectors all over the home. So I'm looking into detectors right now . . . --MM
DeleteA couple of things to think about. We converted from oil to gas last year.
ReplyDelete1. Gas has a LOWER btu per gallon than oil. If you have a forced hot water system gas will not heat the baseboard heaters as well as oil did. We used to have programmable thermostats that would lower the heat 10 deg at night and when we were not home. It would take roughly 20 minutes to bring the house back to warm. With gas we can only lower it 5 degrees as gas can't catch up like oil can. It takes well over an hour to get that 5 degrees back.
2. If you go for a all-in-one burner, aka, flatplate, condensing, tankless boiler, you will more than likely end up waiting considerably longer for hot water at your faucets and shower. We went from approximately 15 seconds till hot water with oil to 1 1/2 minute wait with gas. So long to wait that we actually are installing a recirculation loop to stop wasting water. Think about 1 1/2 minutes of water running down the drain every time you want hot water. We installed a state of the art Rinnai boiler which had some cold ignition, exploding issues so after 3 replacements, the Rinnai people declared it fixed and told my installer "probably we'd be better off with a different manufacturer" so we ended up with a Navien, built in Korea. Not real pleased with this one either. The gas furnace manufacturers are not neighborhood friendly like your local oil manufactures. They tend to be a bit aloof, snobby and the burner company will blame the gas company for problems while the gas company blames the burner company for problems.
Do your homework. You will gain more efficient burning, but because of the lower btu's per gallon of gas may end up using more gas than you would oil. Also, add in the delay in hot water and gas is not so green anymore.
These are good things to think about -- we do indeed have radiators, so #1 applies to us (although because of our insulation job a few years back, the home doesn't drop temperature much at a night, even with the furnace completely off). We also have an electric hot water heater, which will help us get around point #2. (And our oil company is the same as our gas company!) I appreciate the pointers! I'm churning this around in the head . . . --MM
DeleteDon-Linux, I'd bet that your gas boiler has less power (btu/h or kW) than the oil one, and that that is the reason why to heat up tap water or baseboard heaters takes longer than before.
DeleteComparing gas versus oil (theorical) comsumption (without mentioning other intangibles) to get a btu and applying the price of each one would yield the figures to know if it is worth to change the system.
Thus, we have to know the btu/dollar (or kW/dollar) ratio in both fuels. Another factor to consider is the efficiency of each boiler. Other considerations can then be also taken into account (ecology, smelling, cleaning, comfort...).
From Don-Linux experience, I wouldn't go for unknown boiler makers. I'd stick to the well known ones, even if they are more expensive in the initial investment. You'll save in breakdowns, efficiency, technical asistance and... headaches.
One more thing: my sister works in a gas company and she says that many people who make the conversion become scared of the first invoices they get from the provider.