An energy cost comparison

The below cost comparison is between the cost of heating with a propane furnace (standard 80% efficient) and an electric heat pump. An electric heat pump is a heat exchange device, where mechanical energy (in the form of an electric motor) is used to compress a fluid, and when decompressed, the fluid creates a difference of heat between two separate spaces. For heating, the hot side of the exchanger is inside the house, and the cold side is outside of the house. No net heat is created as a result except for the power consumed to facilitate this process. What happens is the inside becomes warmer by a given number of BTUs and the outside becomes colder by the same number of BTUs. 1000 Watts of electric power input to the motor can add 2500 watts of heat to the inside by removing 2500 watts of heat from the outside. The 1000 watts from the motor contributes to the heat of the outside because that is where the motor is located.

The ratio of the 2500 watts gained to the 1000 watts consumed is referred to the coefficient of performance (CoP). In this case the Cop is 2.5.  In reality this number is between 2 and 3.5. In our example we will use a CoP of 3.0.

Propane is currently $2.75 a gallon. A gallon has 92000 BTUs of energy. An December example usage of 9,000,000 BTUs consumed at the gas line (7,200,000 heated the house based on 80% efficiency) would cost $269.02. Propane and Gasoline are both expensive, but portable. A heat pump with a CoP of 3.0 would cost $70.32. Still more expensive than natural gas, but a good option. In freezing weather, the CoP of heat pumps goes down fast. In cold weather natural gas wins by a greater margin.

About Steve @ FPO
Hello FPO readers, I have been writing on financial topics for about 12 years now, but I have only recently reignited the fire of publishing online. I have to say, its good to be back. I am an electrical engineer by trade who enjoys all topics engineering and financial. I started Financial Place Online (FPO) to create a value added financial news and education website that would provide a refreshing daily financial read. Financial Place Online websites are built around the principles of consumer empowerment, leveling the playing field, zero spam tolerance, and none of those annoying sidebar or banner ads. For us, it's all about enjoying a good read.

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