Customers Warm to Boiler Retrofits

October 22, 2012
Trans

With residential new construction barely a blip on the radar these days, most contractors have shifted gears toward educating customers about the benefits of retrofitting older HVAC units with new high-efficiency equipment. In the northeast U.S., where hydronic systems are very popular, that often involves replacing older boilers.

It can make great economic sense for homeowners to replace their existing boilers with high-efficiency gas-fired models, particularly when their 30-year-old boiler probably has an efficiency rating below 70 percent. Compare that to the new condensing boilers that manufacturers claim can achieve efficiencies well above 95 percent AFUE, and it is easy to make an argument for the benefits of upgrading.

But it’s not always an easy sell, as homes in older communities sometimes cannot accommodate the venting requirements for high-efficiency boilers. In addition, the economy is causing some customers to think twice about shelling out extra cash for top-of-the-line boilers.

Tougher Sell

About 10 percent of boiler sales at Macca Plumbing & Heating, Hartford, Conn., are over 90 percent AFUE, said owner Bob Macca, who is also the chairman of the board of trustees of Quality Service Contractors. “It mostly comes down to price. I live in an area with a lot of older residents, and many are thinking they will only be in their homes for another 10 or 15 years. More often than not, they’ll opt for a standard or mid-efficiency boiler, so they don’t have to worry about getting their money back on the more expensive equipment if they have to move out in five years for health reasons.”

However, a change in building code is leading Macca to believe that he will soon see increasing sales of higher efficiency boilers. “The code now says that we have to use a stainless steel liner in the chimney if it’s on an outside wall, and that costs between $1,500 and $2,100. I tell my customers that it’s better to spend that money on a higher efficiency boiler, because we can vent it to the outside, so the liner isn’t needed.”

Sometimes venting to the outside just isn’t possible, though. Moe Haislip, owner, John C. Flood of VA Inc., metro Washington, D.C. area, stated that only about 15 percent of his boiler sales are of the condensing variety, primarily due to the age of the neighborhoods he services. “Older homes, such as those in Old Town Alexandria (Va.), are not conducive to having high-efficiency boilers installed, because most of the homes are connected, so it’s hard to vent them outside. Plus, many of the buildings are historical, so I have to go through zoning, building, and architectural review boards to get approval to do an outside penetration.”

When a homeowner in one of these neighborhoods definitely wants a high-efficiency boiler, Haislip needs to get creative. “I have a house we’re working on now that was built in 1830. I’m looking at modifying one of the old chimneys, going vertical, and venting out the roof. That’s the only option we have in these older neighborhoods.”

Thanks to rebates from the local gas utilities, about 80 percent of the boilers that Rob Basnett, Basnett Plumbing, Heating & AC, Littleton, Mass., sells are high efficiency. “The gas companies take a piece of the ratepayers’ money and put it in a pool, which is managed by an organization called GasNetworks. That group then offers incentives for the installation of high-efficiency boilers and furnaces. For high-efficiency boilers, the rebate is $1,500, and since people are basically paying for it anyway, it gives them the incentive to upgrade.”

In addition to the rebate, Basnett’s customers are usually interested in high-efficiency boilers because of the money they will save on their utility bills. Other times, it makes the most sense when a homeowner is remodeling or finishing a basement. “If the chimney is an issue, a high-efficiency boiler is a good choice, because it can be vented outside. Sometimes, though, customers like the higher efficiency equipment, because it’s more green.”

Market Shifts

While high-efficiency boilers may be a harder sell in some areas, the one retrofit many homeowners are anxious to make is the move from oil to gas-fired units. “As the oil prices go up, people want to get rid of their oil-fired boilers,” said Haislip. “The higher price is the main reason why people want to convert, but sometimes it’s because they don’t like the smell or the space the oil tank takes up in the basement.

Basnett has also been busy replacing oil-fired boilers with gas-fired units, and fortunately, local rebates are helping out with those retrofits as well. “If there’s gas in the street and it doesn’t go to the house, the gas company will charge $1,300 for the first 100 feet, but the homeowner can qualify for a discounted rate on equipment. It’s a big incentive to switch, because right now, a gas customer is paying close to half the amount of an oil customer.”

The local gas company in Macca’s area is being very aggressive by installing gas lines all over West Hartford and the surrounding area. The utility is also offering rebates to convert, and as a result, Macca has been “getting a ton of conversions from oil to gas. People know that just by converting to gas, they’re going to save a lot of money. Many times it’s not for the environment, it’s all about the payback and how much money they will have in their pockets.”

Customers converting from oil to gas may be so thrilled with how much they will save on their energy costs with a standard boiler that they may not consider high-efficiency equipment. But, as Macca, has learned, you just never know. “Just the other day, I was talking to a customer, and all he was focused on was cost. I figured he wasn’t interested in a higher efficiency boiler, but it turns out, he was. Good sales is really asking the right questions and listening more than talking. I’ve learned to give everyone the good, better, best scenario, even if I don’t think they’re going to spend two minutes looking at the best option.”

Basnett has also been surprised on more than one occasion when a customer decides to opt for a high-efficiency boiler. “Last week I quoted a boiler job, and the homeowners said they weren’t interested in a high-efficiency boiler, even after I discussed all the benefits and incentives. But I just got an email saying that’s the way they wanted to go. I find that it’s best to ask customers a lot of questions, because a lot of times they don’t even know what they need or what they’re looking for.”

High-efficiency boilers are definitely the way to go, said Haislip, and he makes that case to every customer. “These boilers are the future. They are going to last 20 to 35 years, and homeowners will be able to get back all the money they’ve invested in them. Not to mention that they will be infinitely more comfortable, because you can add an indirect fired water heater, and they’ll never run out of hot water. There are a lot of advantages with the new boilers.”

Publication date: 10/22/2012
 

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