# Calculating Fuel Savings

We will assume that the proposal is to replace a customer's existing gas furnace with a more efficient furnace. We will compute the projected annual fuel savings and the projected reduction in annual fuel cost by replacing the less efficient furnace with the more efficient furnace.

## Gathering The Information

There are a few things we need to obtain in order to perform the calculations. They are:**The present annual fuel use.**

**The cost per therm of gas charged to the customer.**

**The efficiency of the existing furnace.**

**The efficiency of the new higher efficiency furnace.**

## The Calculation

The fuel savings calculation is as follows:Annual Fuel Savings = Current Annual Fuel Use x 1/Existing Efficiency â€“ 1/New Efficiency

In this example, we shall say we determined from the customer's utility bills that the annual fuel usage for the last 12 months was 1,300 therms and the current furnace is 68 percent efficient as determined by a combustion efficiency test. The new replacement furnace has an efficiency rating of 82 percent. The efficiencies are placed in the equation as decimals. Placing this information in our equation gives the following calculations and results.

Annual Fuel Savings = 1,300 therms x 1/0.68 â€“ 1/0.82

Annual Fuel Savings = 1,300 therms x 1.470 â€“ 1.219

Annual Fuel Savings = 1,300 therms x 0.251

Annual Fuel Savings = 326.3 therms

The approximate annual fuel saved by replacing the 68 percent efficient furnace with the 82 percent efficient furnace is 326.3 therms.

According to the utility bill the customer is billed at $0.85 per therm. Therefore, by multiplying the therms saved by the cost per therm we can determine the annual cost savings expected.

Annual Cost Savings = Annual Fuel Savings x Cost Per Therm

Annual Cost Savings = 326.3 therms x $0.85

Annual Cost Savings = $277.35

The annual cost savings is only one of several factors the customer should consider when deciding to replace a system. Other factors include the increased comfort from the new system, increased dependability, increased safety, peace of mind, and increased resale value of the home. Don't forget the possibility that the local utility may have an energy rebate available for upgrading to a more efficient furnace.

The technician or salesperson who can show the customer the expected savings has the advantage over those who do not. In addition, simply performing the calculations for the customer often closes the sale simply because it shows the customer that the technician or salesperson "knows his stuff."

If the replacement of the furnace also includes additional work such as sealing leaking duct joints, the repair or addition of insulation on ducts, and the installation of a programmable thermostat, the annual savings will be higher still.

Similar calculations can be performed for oil-fired boilers and furnaces. Still other calculations are available to calculate the energy savings possible for air conditioning and heat pump systems when upgrading to equipment with higher SEER ratings.

*Norm Christopherson is a technical writer, seminar presenter, and former HVACR instructor. He is currently seeking training opportunities. He can be contacted at nchristo@juno.com.*

**Publication date:** 12/01/2003