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Thread: Electric vs gas costs

  1. #1
    Join Date
    Sep 2010
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    Colorado ->Richmond
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    Default Electric vs gas costs

    Hello,

    Looking for information on cost effectiveness of using either electricity or gas for operating a steam boiler in the Nelson to Motueka area. It appears that energy options are either propane, electricity, or heating oil for heat. I have to make a choice for heating a brewery and like the idea of using an electric steam boiler as there are no tanks to fill and it is simple but curious as to whether it is cost effective. Does anyone know if there are good supplies of solar hot water (vacuum tube) installer for preheating or photovoltaic? Any engineers on here that can help or recommend someone? Starting the planning for my brewery!

  2. #2
    Join Date
    Jan 2013
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    Vermont, USA --> Wellington
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    Default

    It's actually a pretty simple math problem.

    Propane = 24,603 BTU per litre @ $0.599 per litre.
    Electricity = 3,412 BTU per kwh @ $0.26 per kw

    For 1M BTUs from propane, you'll need about 40 litres, or about $24.
    For 1M BTUs from electricity, you'll need 293 kwh, or about $76.

    This assumes 100% efficiency, of course. All electric heaters are 100% efficient, but propane furnaces will max out around 95%. An older or cheaper furnace might be around 80%. So add 20% or so to the cost of propane.

    Lastly, you need to calculate the up-front cost of each. Electric heaters are exceedingly cheap, but if you're going to shell out $10k for a propane furnace, you need to think about how long it will take to recover the expense.

    By the way:

    Hardwood (gum) = 18M BTU per cord @ $300/cord.
    1M BTUs = $16.

    But logburners are only 65% efficient or so.

  3. #3
    Join Date
    Jan 2007
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    Chch, NZ
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    In terms of operating cost, it'ss really hard to beat solar tube in conjunction with an electric heat pump. With heat pumps there's a 'coefficient of performance' factor. That is for typical heat pumps, 1kW unit of electricity used could generate you 3kW units of actual heating. Since you're going semi-large scale (well beyond the residential home use), there's more efficiency gain with 3 phase powered heat pumps.

    Consider looking at redundancy and future proofing. Unlike LPG/propane or oil boilers, future technological advances will be in heat pumps with the emphasis of reducing carbon emissions.

  4. #4
    Join Date
    Sep 2010
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    Colorado ->Richmond
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    Default

    Thanks A.C.Slater! The NZ propane price is actually very reasonable and compares to prices here. This definitely encourages me to choose propane vs. electric for our steam boiler. I think a vacuum tube collector to preheat the boiler could save significantly but with that propane cost it would be interesting to calculate the rate of return.

    Cheers!

  5. #5
    Join Date
    Sep 2014
    Location
    Marlborough Sounds
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    The calculations aren't that simple.

    To my knowledge bulk propane is not available in NZ. You can only buy LPG which is mostly very poor quality i.e. butane.

    The cost of electricity will vary greatly depending on your location and whether you have a residential or commercial connection.

    Log burners may only be 65% efficient, but log boilers can be 95% efficient, and the price of wood can be almost zero if you grow it yourself.
    Also wood fired heating is effectively renewable solar energy.

  6. #6
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    To my knowledge bulk propane is not available in NZ. You can only buy LPG which is mostly very poor quality
    Correct, most people underestimate the full cost of running LPG because in the NZ environment, LPG is not that plentiful in NZ (most if i'm not mistaken is now imported from overseas but, the future could change when shale fracking goes in full swing). Going by the bottle refill price, I would like to show this price on my recent trip in Canada



    Which works out to be $16 NZD (after taxes) - the bottle size fill is 20 lb or 9kg - FYI, the most accurate way of dispensing any gaseous product (Nat. Gas / LPG / etc) is by WEIGHT (not by per volume which varies a lot to the ambient temperature). In Christchurch, local Caltex service station has flat rate fill for $28 NZD. Prices may be a little less on the commodity product alone via 45kg bottle home delivery however, suppliers nail you on delivery fees. LPG (reticulated) that is central underground connected to individual houses in a sub-division also attracts huge line connection fees.

    For 1M BTUs from propane, you'll need about 40 litres, or about $24
    If you base this on NZ bottle pricing, the $24 figure is far from accurate. A 20kg LPG bottle (to get your 40 litre BTU estimate) would cost about $70 NZD. Perhaps less if you were able to fill at a bulk rate direct from an LPG station.

    On pure energy unit basis, the cost difference between electricity vs LPG propane in NZ is almost on par. But as i've said in the previous post, people's heating needs are benefiting through the use of heat pump technology (where the COP figure is increasing all the time). Even with a co-efficiency of performance figure of 2 - you are getting double the energy from 1 unit of electricity consumed (something that burning combustion fuel can never do). Also there's a huge difference in efficiency factor when heat pumps heat air vs heating water, the latter being far more efficient.

  7. #7
    Join Date
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    I'd also look at historical propane prices for your area. While propane is also a product of natural gas production, including fracking, it's prices seem to remain high in northern Virigina. While looking at houses to rent, we specifically steered clear of one house because of propane used for winter heating. Annual bills of USD$3000 were not unheard of (bulk purchase several times / year for 3000+ sq ft home).
    Also take a look at the fuel source used for generating your electricity. It could be as susceptible to prices increases too.

    Not sure if this will help you much, but a co-worker was looking at purchasing a property in New England, which gets quite cold in the winter. The property had a duel fuel (wood/propane) boiler, and the owner claimed that using wood (relatively cheap in the area), saved about 40% by using wood rather than propane.

  8. #8
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    Also take a look at the fuel source used for generating your electricity. It could be as susceptible to prices increases too.
    NZ electricity generation is well over 70% from renewable sources. However, electricity prices in NZ are not even comparable to N. American prices. We're around 25 to 30 cents /kW/Hr whereas you can be as cheap as 7 cents in some parts of N. America. This is the price that people have to pay for sourcing electricity from renewable sources. http://en.wikipedia.org/wiki/Renewab...in_New_Zealand

    New migrants from the US, be aware that in NZ houses are generally heated 1 room at a time. If we applied the same full house heating to a 3000 ft^2 in NZ, annual bill cost could be over $6,000 NZD.

    Also there's not a lot going for burning wood in NZ (specifically in urban living where local city councils want to clean up the air). Carbon emissions is the problem whereas using electricity in NZ, at least 70% of it doesn't come from carbon emitting sources.

  9. #9
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    12-15 cents/KWH (with taxes) is more typical in my experience, but point taken, a lot cheaper than NZ. How much do CFL and LED bulbs cost in NZ? Still not cheap in US, but prices are dropping.

    I'm starting to come around to the by-room heating/cooling logic. Is it a valid assumption that this is manual by-room vice some automatic temperature setting for each room? I vaugely remember my parents turning on individual radiators in our house in the UK when I was a child, but I don't think you could pick a temperature; more trial and error.
    Large houses in US do soak up energy pumping heat/cooling to unused rooms most of the time.

    Of course, a sweater is 'by-room' too...

  10. #10
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    Colorado ->Richmond
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    Great discussion! After we looked at all options and costs we ended up going the route of an electric steam boiler. Their cost is same as a direct fired propane boiler but you save on venting and have significantly improved heating (for a brewery at least). In finding a house we looked for a solid insulated, double glazing house with wood and heat pumps; we'll see how it all works out.

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