PROPANE NO QUICK FIX
By MECHELE COOPER
Staff Writer Kennebec Journal & Morning Sentinel 05/10/2008

By MECHELE COOPER

Staff Writer

If you're converting your oil furnace to propane to save money, don't bother.

Although propane now costs less than heating oil, it typically is about the same -- or more.

Homeowners using 900 to 1,200 gallons of oil are currently paying $2.98 for a gallon of propane compared to $4.07 a gallon for No. 2 heating oil, according to Jeff Choate, an Augusta Fuel Co. operations manager.

But heating oil is inherently more efficient, he said.

For the last six months, Choate said a number of his customers have been asking about propane and whether it would be cost-effective to change over their heating systems.

"One thing people aren't aware of is that you have to compare apples to apples," Choate said. "What I mean by that is, even though there's a price difference between fuel oil and propane, you have to make sure the price difference is enough to make up the difference in the number of BTUs you get from each product.

"There are more BTUs per gallon in a gallon of oil than there is in a gallon of propane."

BTUs, or British Thermal Units, measures the amount of heat needed to raise one pound of water 1 degree Fahrenheit from a starting point of 39 degrees Fahrenheit. It is a standard measure for heating fuels.

Choate said another factor to consider when comparing fuel oil to propane is the efficiency of the heating unit in a home.

Whether it's a warm-air furnace or space heater, he said the more efficient it is, the less of any kind of fuel you'll use.

People should be upgrading their heating systems rather than converting to another type of fuel, he said.

"The other big thing is insulation, insulation, insulation," he said. "It's so important that a home is as tight as possible. Every little crack and crevice where air can escape is money out the door."

Jamie Py, president of the Maine Oil Dealers Association which also represents propane dealers, said natural gas and propane currently have an advantage over heating oil but that, traditionally, those fuel sources cost more than oil.

Prices for natural gas and propane were higher than heating oil in 17 of the last 20 years, he said.

He agrees with Choate that people should not jump at converting heating systems.

"I don't want to see a customer make a mistake and spend a ton of money on something that could be a short-term price advantage," Py said. "Because historically, heating oil has been a better buy."

He recommends taking advantage of new technology to increase efficiency in one's current heating system.

Conversion is an unnecessary capital expense, he said if prices change back.

"It's very expensive to replace all your equipment and go to another product," he said. "But people can have the existing equipment upgraded, everything from a tune-up to installing an energy-efficient hot water tank."

Ian Burnes, deputy director of policy and planning at the Governor's Office of Energy Independence and Security, said the global demand for oil products is extremely high right now, which is driving up prices.

Speculators and the weakened value of the U.S. dollar have also pushed up the price of a barrel of oil.

Demand for propane, which is a byproduct of the crude oil refining process, is not as high.

"This is a market of discontinuity right now," Burnes said. "I don't have any idea how long it will last so it would be unwise to make a large investment (to convert heating systems) based on this. The price of oil is extremely volatile. It would be worth it to spend a little bit of money on an energy audit for your house to see how you can reduce consumption. "

Mechele Cooper -- 623-3811, Ext. 408

mcooper@centralmaine.com

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