Different Fuel Options for Heating your Home

One of the major elements to consider with the installment of a new heat system is the type of fuel that you, the consumer, will be using. While the heat system itself can be considered a single cost, the cost of the fuel and the efficiency of the system can have significant pricetags as well. With fluctuating fuel prices and the ready availability of alternate sources of fuel, you should take the time to weigh the options available before making your decision. Of the different fuel options available to you, four fuel sources dominate the market: Heat Oil, Propane, Natural Gas, and Electric.


When trying to compare the cost of running heat systems on the various fuel sources, we are first confronted with the different forms of measurement for each fuel source. Keep in mind though, that the prices used below were the price at the time the article was written and are subject to fluctuation.

Type of FuelMeasurementEstimated Cost
Heating oil gallon $1.88/gallon
Propane gallon $2.68/gallon
Natural gas therm $1.13/therm
Electricity kilowatt-hour (KWH)12.9¢/kWh

To compare the different sources, we have to convert each into a cost per BTU's.

Type of FuelConversionEstimated Cost per 100,000 BTU
Heating oil 140,000 BTU per gallon$1.34
Propane 91,333 BTU per gallon$2.93
Natural gas One therm equals 100,000 BTU$1.13
Electricity 3,413 BTU per One KWH$3.78


Cost of Oil and Propane
Cost of Natural Gas
Cost of Electricity


The efficiency of heat system can be influenced by several factors. The heater itself produces heat at a certain efficiency, known as the AFUE (Annual Fuel Utilization Efficiency) for furnaces and boilers or the HSPF (Heating Seasonal Performance Factor) for heat pumps.

AFUE ratings range from 80% to 95% in most modern systems. This means that when the heater is running at peak performance, a high efficiency oil burning unit with a 95% AFUE will produce 133,000 BTU's of heat per gallon of oil (Oil produces 144,000 BTU's of heat perfectly, so 144,000BTU's x 95% = 133,000BTU's).

HSPF ratings range from a minimum of 7.7 to 13 in today's systems. The conversion for the efficiency of heat pumps is not a straight cut percentage as with the other systems. Instead, HSPF is an average of the total BTU's produced by the system across the heat season divided by the total watts used by the system over that period. Should we want to express it as a percentage though, we need only divide the HSPF rating for the system by 3.413. So a low efficiency heat pump with a HSPF of 8 will produce 2.34 BTU's of heat for every watt of electricity. This is possible due to the fact that heat pumps do not create heat, they transfer the heat.

But consumers should also be aware that other components such as the ductwork, chimney and even the regularity of maintenance all have a definite impact on the overall system performance.