Author Topic: Propane vs natural gas  (Read 1301 times)

Just Joe

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Propane vs natural gas
« on: October 01, 2021, 09:40:30 AM »
Hello MMM folks!

I called yesterday to schedule a propane delivery. Operator quoted me $5.80 per gallon making a 500 gallon delivery quite expensive. 500 gallons would last the better part of six months.

When we first moved into this house, propane was $2 per gallon.

Since we moved into the house, a natural gas line was installed along the road and I've called them to give me a price to connect to this line.

I'm having a hard time comparing the costs of heating with propane and natural gas. First the information on the web seems to be muddy. Admittedly I have not spent much time on the topic due to work and other things.

Can a forum member coach me on an easy way to compare the costs of the two? Thanks...

Just Joe

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Re: Propane vs natural gas
« Reply #1 on: October 01, 2021, 09:52:51 AM »
I should add that as our existing gas furnaces age out, we're planning to go with heat pumps like we've had at previous homes. At our last home when the furnace aged out, we had a hybrid heat-pump/gas furnace w/ air conditioning installed.

I wouldn't worry about natural gas at all - but we live in a rural area and have a house generator that we've relied on several times since we've lived there. The week long ice storm last year for example. The previous owner's told us that they'd hardly ever used the generator in the time it has been there. Sure... We've relied on it a half dozen times for significant lengths of time per year.

We don't mind "camping out" in the house but without a proper chimney for a fireplace or wood stove for backup heat, that generator was a life saver last winter. We don't want to heat with unvented things like gas or kerosene. We do have a vented chimney with gas logs.

Askel

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Re: Propane vs natural gas
« Reply #2 on: October 01, 2021, 10:34:13 AM »
Yikes! Where the heck does propane cost $5.80/gallon?!  Hope that's not USD! 

(I was cranky this year because my contract price went up 50% to $1.85/gal.)

I think which is more economical ultimately depends on the local area and distribution network.  There's a big fight going on about a nearby gas/oil pipeline under lake michigan and one of the issues at stake is that it delivers propane to our area on the cheap. 

But I'd be inclined to believe that natural gas usually wins, otherwise everybody would be shutting it off in favor of propane if it had a huge price advantage. 

An electrical engineering friend told me that energy prices all tend to move together because if one starts to become more economical, large industries with flexibility will start switching to it en masse.

One thing that might be worth looking into- do you own your tank? Most people lease theirs from their propane provider and are thus locked in to whatever price they offer.  If you own your own tank, you can purchase from any provider- often at significant savings.   

nedwin

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Re: Propane vs natural gas
« Reply #3 on: October 01, 2021, 10:51:32 AM »
To estimate the cost difference you need to estimate how much nat gas you would use in a typical winter and use this to calculate its cost from the local utility.  You might be able to use the gallons of propane used each year, convert the gallons to BTUs, and convert BTUs to whatever unit the utility sells gas in.  I also believe nat gas should be less expensive than propane, especially if you're paying $5.80/gallon.

Another cost to consider if you want to convert to natural gas is that all your propane burning appliances (furnace, water heater, generator, stove/oven) will need to also be converted to natural gas, and some appliances may not be able to be converted due to age or design.

Morning Glory

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Re: Propane vs natural gas
« Reply #4 on: October 01, 2021, 12:31:14 PM »

One thing that might be worth looking into- do you own your tank? Most people lease theirs from their propane provider and are thus locked in to whatever price they offer.  If you own your own tank, you can purchase from any provider- often at significant savings.

If you lease you can switch providers as often as you want. Frugalwoods did a post on this. The new provider will hook up their tank and pump your propane into it, then set the old one in the yard somewhere and you call the old provider to come pick it up.  I would imagine that they would get annoyed if you did this too often, but every few years is not a big deal.  Bonus is that the new tank always looks better too.

5.80 is crazy. When I had propane I would contract in September for the winter instead of paying the "truck price". I think the highest I ever paid was 1.49, even though in 2014 there was a shortage and the "truck price" spiked over $5 for a short period. I would definitely get the natural gas line installed if the price difference was that much.

It's actually quite easy to convert your furnace to natural gas, according to my friend who used to install and repair furnaces. There's just a little metal thingy that you switch out.  I'm not sure about stoves, dryers, etc.

Askel

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Re: Propane vs natural gas
« Reply #5 on: October 01, 2021, 01:17:42 PM »
Yeah, definitely worth calling other providers to see what they can do. 

When I first moved into my last place, I misidentified who my propane provider was. (very similar color scheme on the tanks). The competitor I called was willing to get a new tank in my yard THAT DAY.   

So, this seems like something easy to do. 

Although the guy I know with his own tank had to repeatedly threaten to sell the tank of his previous provider before they finally picked it up 2 years after it had been disconnected. So YMMV.   


GuitarStv

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Re: Propane vs natural gas
« Reply #6 on: October 01, 2021, 01:19:45 PM »
Propane often spikes to be much more expensive in the fall depending on where you live.  Farmers use it to dry crops in wet years, so if they had a wet year in your area it's probably going to be way more than normal.

Paper Chaser

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Re: Propane vs natural gas
« Reply #7 on: October 01, 2021, 01:21:10 PM »
It seems to me that propane prices vary a lot more than NG prices, and the chances of running out of NG are a lot lower. Besides that, it's just basic math. By volume, propane has about 2.5 times the energy of NG. So you'll need about 2.5 times the NG as you would propane. Find out what your NG utility charges and do a little math.

Just Joe

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Re: Propane vs natural gas
« Reply #8 on: October 04, 2021, 10:10:51 AM »
Yikes! Where the heck does propane cost $5.80/gallon?!  Hope that's not USD! 

(I was cranky this year because my contract price went up 50% to $1.85/gal.)

I think which is more economical ultimately depends on the local area and distribution network.  There's a big fight going on about a nearby gas/oil pipeline under lake michigan and one of the issues at stake is that it delivers propane to our area on the cheap. 

But I'd be inclined to believe that natural gas usually wins, otherwise everybody would be shutting it off in favor of propane if it had a huge price advantage. 

An electrical engineering friend told me that energy prices all tend to move together because if one starts to become more economical, large industries with flexibility will start switching to it en masse.

One thing that might be worth looking into- do you own your tank? Most people lease theirs from their propane provider and are thus locked in to whatever price they offer.  If you own your own tank, you can purchase from any provider- often at significant savings.

Yes, that is the current price of Suburban Propane in USD. We rent our own tank. Good point on the price competition when we can call any supplier.

Just Joe

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Re: Propane vs natural gas
« Reply #9 on: October 04, 2021, 10:12:39 AM »

One thing that might be worth looking into- do you own your tank? Most people lease theirs from their propane provider and are thus locked in to whatever price they offer.  If you own your own tank, you can purchase from any provider- often at significant savings.

If you lease you can switch providers as often as you want. Frugalwoods did a post on this. The new provider will hook up their tank and pump your propane into it, then set the old one in the yard somewhere and you call the old provider to come pick it up.  I would imagine that they would get annoyed if you did this too often, but every few years is not a big deal.  Bonus is that the new tank always looks better too.

5.80 is crazy. When I had propane I would contract in September for the winter instead of paying the "truck price". I think the highest I ever paid was 1.49, even though in 2014 there was a shortage and the "truck price" spiked over $5 for a short period. I would definitely get the natural gas line installed if the price difference was that much.

It's actually quite easy to convert your furnace to natural gas, according to my friend who used to install and repair furnaces. There's just a little metal thingy that you switch out.  I'm not sure about stoves, dryers, etc.

Thank you for your info. We only need to switch the instant water heater, two furnaces, and the house generator. We have an electric dryer. 

Just Joe

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Re: Propane vs natural gas
« Reply #10 on: October 04, 2021, 10:15:20 AM »
It seems to me that propane prices vary a lot more than NG prices, and the chances of running out of NG are a lot lower. Besides that, it's just basic math. By volume, propane has about 2.5 times the energy of NG. So you'll need about 2.5 times the NG as you would propane. Find out what your NG utility charges and do a little math.

Thanks. Its been a crazy week. The math is more obvious today than last week with the forum's help. I'll do the homework this week so when the gas company comes to give me an estimate I have my numbers ready to go.

Fishindude

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Re: Propane vs natural gas
« Reply #11 on: October 04, 2021, 10:26:07 AM »
That is a ridiculous price for propane, we pay less than half that per gallon.
Regardless, natural gas is always cheaper, as it comes via pipeline and doesn't have to be hauled.
If you have a natural gas line in the street out front, you can probably get your heating bill down considerably by switching.  Most furnaces and appliances can be converted from LP to nat gas rather economically.


NorCal

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Re: Propane vs natural gas
« Reply #12 on: October 04, 2021, 10:47:55 AM »
I don’t really know prices on such things, but I’d look at the cost up upgrading to a heat pump now compared to connecting to the NG line.

If you plan to get a heat pump anyways, it might be a better move to just do that earlier.  You’ll have to get a quote to compare the two though.


TheFrenchCat

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Re: Propane vs natural gas
« Reply #13 on: October 04, 2021, 12:21:25 PM »
I think natural gas is generally cheaper.  We use propane solely for heating and we used to have natural gas just for heating too.  Both houses were in similar climates and similar sizes, so I'd imagine the amount of heat needed was about the same.  We pay about $1200 per year for propane (I don't remember exactly how much per gallon, but I think it was around $2 per gallon.)  Whereas we paid about $600 a year when we had natural gas.  So do the math for your situation, but I'd imagine the savings could be considerable.

katsiki

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Re: Propane vs natural gas
« Reply #14 on: October 04, 2021, 01:33:55 PM »
That is a ridiculous price for propane, we pay less than half that per gallon.
Same here.  Shop around?

Just Joe

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Re: Propane vs natural gas
« Reply #15 on: October 04, 2021, 02:05:36 PM »
Few details gathered today for anyone doing a search in the future.

Gas company will install 300 ft of gas line to the house for free. Then it is $5 per foot after that.

They'll also give me 1000 ft of gas line for free if I want to dig the trench myself. They do the connections.

There are local plumbers and HVAC who are licensed to connect our equipment to the gas line and do alterations.

Also, if we were to buy (re-buy) gas logs from the gas company, they will come out and hook them up for free. Technician that visited our house pointed at candidly that their profit margin on the gas logs was high enough to cover the installation and thus not an automatic savings on installation.

More details as I learn them.

Paper Chaser

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Re: Propane vs natural gas
« Reply #16 on: October 05, 2021, 10:15:02 AM »
Been reading more and more stories about propane/natural gas shortages. Propane is currently the highest it's been since 2014:

https://www.weau.com/2021/10/01/filling-your-propane-tank-could-empty-your-wallet-this-year/

In most of the stories that I'm seeing, "experts" frequently predict prices to double or even triple what they'd normally be for this winter. It's a good idea to shop around if you can, but it seems like you're likely to pay more to heat your home this winter than you have in years past.

Just Joe

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Re: Propane vs natural gas
« Reply #17 on: October 06, 2021, 09:25:55 AM »
Thank you PaperChaser. 

Just Joe

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Re: Propane vs natural gas
« Reply #18 on: October 11, 2021, 09:26:10 AM »
For any future readers:

Convert Propane Gallons to Therms

Step 1
Multiply the number of gallons of propane by 91,647 to get the number of British Thermal Units because one gallon of propane equals 91,647 BTUs.

Step 2
Multiply the number of gallons of propane by .91647 to get the number of therms. This is because one therm equals 100,000 BTUs.

Step 3
Multiply the number of gallons of propane by 91.647 to get the approximate equivalent cubic feet of natural gas that has the same energy. This is because one cubic foot of natural gas is equal to about 1000 BTUs.

In the end, for us natural gas wins. Less money for same heat even taking into account that propane contains more energy. More price stability. Eventually transitioning from gas to electric with gas backup for generator and winter storm heating.

~$250 for the ditch machine rental for whole weekend
gas line = free from gas company, they will hook up meter they provide for free
~$500 for HVAC company to hookup and adapt existing furnaces and instant hot water heater
~$200 for the house generator conversion kit

Other details: I could buy a brand new 500 gallon propane tank for ~$500 locally. Then as someone up thread suggested buy my fuel from any company that is most competitive. Other sources here in town currently beat the nearly $6 a gallon price by $3.

More details - tank company would not deliver but they would load a trailer. UHaul trailer = less than $50 a day.

We would have off loaded using an engine lift crane I own. Look at HF if you don't know what this is. Tank weighs about 1000-1200 lbs. Engine crane is rated at 2000 lbs.

Long term strategy: we have two separate heat/cool systems in this house.

As the equipment ages out, we'll replace with gas/heat pump hybrid systems. Had one at previous house. 

Side project: Need to reconfigure main floor air handler to get its air return from the basement. Right now basement air does not turn over due to second floor air return. 

When instant water heater ages out - replace with similar or heat pump water heater.

Hope this is useful for someone.
« Last Edit: October 12, 2021, 11:25:55 AM by Just Joe »