Gas or electric?

This is a question I get asked all the time - which is better, gas or electric? There's not a single answer to this question, it depends what your criteria is for "better". Most people want to minimize operating cost, but some people want to use less energy or have lower carbon emissions. Many people would like to do all of the above. In this post, I'll answer the question in generalities, and then follow up with a couple posts that have actual numbers. Here are the major differences between the fuels:

Equipment efficiency: The efficiency of gas furnaces and water heaters can't ever go above 100%. In reality, 95%-97% is the highest efficiency out there. This is because they burn the fuel to generate heat, and you can't get more heat energy than is in the fuel. The same is true for electric equipment (like most water heaters and baseboard radiators) that use the electric to directly generate heat. However, there is one big difference: electricity is generated by burning fossil fuels at a power plant, and then delivered to you at about 35% efficiency. So, a 100% efficient baseboard radiator is really only 35% efficient in terms of "source" energy use. This is why carbon emissions are often higher for electric equipment. Heat pumps are an exception to this rule. Instead of using electricity to generate heat directly, they use electricity to move heat from one place to another. For every 1 unit of energy that a heat pump uses, you can move approximately 3 units of heat energy into your house. This is equivalent to being 300% efficient. Combine that with 35% distribution efficiency and you're still at 105%, which puts them back into competitiveness with gas in terms of source efficiency and emissions. One downside with heat pumps is that when it's very cold outside, they don't work very well and have to use "backup heat" (which takes us back to generating heat directly from an electric coil) - if a home is in a cold climate, unless you have a special type of heat pump, this will reduce the overall efficiency throughout the year.

Fuel cost (usage, service charges, and hookup): Electricity is one of the most "price stable" forms of energy. Its cost varies a lot depending where you live, but it does not tend to fluctuate like some other fuels do. Another advantage is that every home has electricity coming into it. So, you would be paying the monthly surcharge for this utility anyway (most utility bills have a monthly "base fee" that everyone pays regardless of usage - usually $10 or so). For a new home, you would be paying to hook into the electrical grid anyway (or installing solar and a lot of batteries). Natural gas price is more volatile than electricity, but not as volatile as propane. However, it it not available as a utility in every location, and if it is available owners of new homes may have to spend several thousand dollars to hook up to the gas utility. There is usually a monthly service charge to have gas service to the home (typically about $1o per month). So, to be more cost-effective, efficiency gains have to be large enough to save at least $120 per year plus recoup installation costs (this almost never happens in affordable housing, which is smaller and has lower demand for heating to begin with). If natural gas isn't available, propane is the next option. Most people either purchase a tank for an up-front charge, or they rent a tank for a monthly fee (similar to the service charge for other utilities). Propane prices have been very volatile over the past three years (varying from $1.30 to $3.30 per gallon) in our area. At the higher range of these rates (over about $250 per gallon), we have not been seeing any circumstances where propane is the lower-cost option.

Equipment cost: In our area, most homes have air conditioners. A heat pump is simply an air conditioner that can work in reverse in the winter-time. If a home is going to have air conditioning anyway, "upgrading" to a heat pump is very inexpensive. There is cost to add a gas furnace. Also, with furnaces and gas water heaters, there can be some added cost to install gas piping.

Comfort: Some people find that gas heat makes them feel "warmer". Technically, heat pumps and gas furnaces can both "meet" your thermostat setting and produce the same indoor temperature. The difference is that heat pumps supply air at lower temperatures than gas furnaces do. If you feel 85 degree air blowing out of a register, it will feel cool, but if you feel 120 degree air blowing out, it will feel warm. Ideally, the HVAC system will be designed and installed so that you don't feel air blowing out of the registers, and this will be a minor issue. A side effect of this is that the gas furnace will have a shorter "recovery" time. If you go on vacation and set the heat down to 50 degrees, when you come home you can fire up a gas furnace and be warm very quickly. With a heat pump, it will take longer. Some programmable thermostats now let you program in your return date so that the house can be ready for you.

Indoor air quality: All homes with any gas appliance should have carbon monoxide detectors. In addition, "sealed combustion" equipment is safer and less likely to backdraft combustion by-products into the house. This type of equipment is also more efficient, so there are a number of reasons to install it. Using electrical appliances means that combustion takes place at the power plant rather than in your home. This affects outdoor air quality, which is where our indoor air comes from and also a major issue on its own. In the "green building" world, if you choose electricity as your primary fuel source, then you should also actively support the "greening" of the electrical grid to include more renewable energy.

Carbon emissions: Natural gas, propane, and electricity (in our area generated mostly from coal) have different carbon emissions. Per 1 million Btu, electricity generates about 360 lb CO2, natural gas about 120lb, and propane about 140 lb. That means that to get equal carbon emissions, electricity must be used 3 times as efficiently as natural gas, and about 2.5 times more efficiently than propane.