Washington, D.C. – The American Gas Association (AGA) today announced that residential customers could cut their annual heating costs nearly in half by choosing natural gas appliances. These findings come with the release of AGA’s 2014 Representative Average Residential Space Heating and Water Heating Costs analysis, which compare average annual costs for various types of space and water heating appliances. According to estimates, customers can save up to $1,262 on space heating and more than $300 on water heating costs annually by using appliances powered by natural gas instead of other common energy choices. The cost comparisons are based on the United States Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy’s Representative Average Unit Costs of Energy notice as published in the Federal Register on March 18, 2014. After a winter marked by sustained cold and record energy demand, this information can help Americans to better understand how to meet their energy needs.
“These numbers show that natural gas is the clear choice for consumers looking to save on home heating costs,” said AGA President and CEO Dave McCurdy. “Choosing natural gas means you don’t have to choose between your wallet and the environment. This is because the direct use of natural gas in home appliances is the clean, efficient choice, achieving 92 percent energy efficiency and producing nearly 40 percent fewer greenhouse gas emissions than a home with all-electric appliances.”
America’s natural gas utilities are dedicated to helping their customers achieve even greater savings. In 2012, natural gas utilities spent $1.1 billion on efficiency programs, providing valuable tools, incentives and information to help their customers understand and reduce their energy usage. Many in the nation continue to struggle to pay their energy bills, and these resources, along with assistance to low income customers provided by utilities and government programs such as LIHEAP, are essential to ensuring that no American needs to choose between energy and other basic needs.
A piece of equipment with a higher annual fuel utilization efficiency (AFUE) rating provides greater savings for customers. For example, a 97 percent AFUE natural gas furnace provides the lowest cost space heating option for homeowners, followed by an 80 percent AFUE natural gas furnace. Both offer significant annual operating cost savings over comparable space heating options.
The tables below demonstrate estimated cost comparisons for home and water heating devices.
SPACE HEATING ANALYSIS SUMMARY: The space heating analysis is based on a 2,072 square foot house located in St. Louis and represents a 5,000 Heating Degree Day location. The house meets the energy conservation provisions in the 2012 International Residential Code and the space heating equipment is selected from the AHRI online directory. The 97 percent AFUE natural gas furnace provides the lowest annual operating cost followed by the 80 percent AFUE gas furnace.
2014 Space Heating Annual Cost Summary
(Annual Operating Cost)
|Heating Equipment Type||5000 Heating Degree Days|
|97% AFUE Gas Furnace||$544|
|80% AFUE Gas Furnace||$714|
|7.7 HSPF Electric Heat Pump||$1,029|
|97% AFUE Propane Furnace||$1,409|
|87% AFUE Oil Furnace||$1,500|
|80% AFUE Propane Furnace||$1,793|
|80% AFUE Oil Furnace||$1,614|
|Electric Resistance Furnace||$1,806|
WATER HEATER ANALYSIS SUMMARY: The water heater analysis is based on the equivalent First Hour Rating (FHR), national average energy usage, and the 2014 energy costs as published by DOE. A natural gas 40-gallon and an electric 50-gallon, both conventional storage types, are chosen based on their FHR. The natural gas water heater would provide the lowest annual operating cost.
2014 Water Heating Annual Cost Summary
(Annual Operating Cost from Low to High)
|Water Heater Type||Annual Cost|
|40 Gallon Natural Gas (FHR = 74 gallons)||$275|
|50 Gallon Electric (FHR = 67 gallons)||$576|
COMBINATION SPACE HEATING AND WATER HEATER INSTALLATION: Based on the annual cost analysis for space heating and water heaters, the combination of a natural gas 97% AFUE furnace and storage water heater provides the lowest operating cost space/water heating package.
2014 Space Heating with Water Heater Installations
(Annual Operating Cost from Low to High)
|Space Heating/ Water Heating Type||Annual Cost|
|Natural Gas: 97% AFUE Furnace & Water Heater||$819|
|Natural Gas: 80% AFUE & Water Heater||$989|
|Electric: Heat Pump & Water Heater||$1,605|
About the American Gas Association
The American Gas Association, founded in 1918, represents more than 200 local energy companies that deliver clean natural gas throughout the United States. There are more than 71 million residential, commercial and industrial natural gas customers in the U.S., of which 92 percent — more than 65 million customers — receive their gas from AGA members. Today, natural gas meets almost one-fourth of the United States’ energy needs.