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Making the decision to switch from oil or electric power to heat your home to propane or natural gas involves many things but without being overwhelmed by the details, you can get the pertinent facts to help you make an informed decision.

Propane and natural gas furnaces are by and large cheaper to operate than electric and oil powered furnaces. If you are shopping for a gas furnace, you may want to go with one that has a high AFUE rating (between 90 and 98.5%) as these will save you the most money in the long run although the units themselves may be slightly more expensive upfront.

The Benefits of Switching to Propane and Natural Gas

  • Improved efficiency and reduced environmental impact. Propane and natural gas furnaces tend to operate at a significantly higher AFUE than oil furnaces, meaning they convert more of the fuel to usable heat. This means less waste and fewer harmful emissions.
  • Pay as you go & equalized payments. Many oil suppliers may charge upfront for a tank refill, whereas most natural gas utilities will charge you on a monthly or bi-monthly basis for what you use. Many also offer the option to spread the payments out in equal and predictable amounts so there are no surprises.
  • Increased home value. A new modern propane or gas heating system is more efficient, affordable, and heats more effectively than oil. This makes it a more attractive option for potential home buyers and is a great all-around investment.

Other Benefits:

  1. Space savings – The most immediate benefit of a gas or propane furnace conversion is the space you will save. New propane and gas furnaces tend to be more compact and take up less space in your home than older oil furnaces.
  2. Propane and gas are also much cheaper than electric and oil heating. These furnaces are generally cheaper to operate than electric and oil furnaces, since electricity far more expensive, while oil is also fairly expensive and is burned far less efficiently. Gas and propane furnaces also require comparatively little electricity (usually only for parts like the blower). Propane and gas also burn hotter than electric and more completely than oil and can operate in short intervals so that they are not always running, thus saving you more money.
  3. Rebates – The Canadian and your provincial government often offer incentives and rebates for switching from oil to a new high-efficiency furnace.
  4. Natural Gas vs PropaneNatural gas is a great alternative to both oil and electrical furnaces and even propane furnaces if you live in an urban area where gas lines can be easily hooked up to the local supply. Natural gas is very economical and costs about a third less than even propane.
    1. Constant supplyAnother advantage of natural gas is that there are no tank refills required. Unlike oil (and propane) furnaces that need a tank of regularly replenished fuel, natural gas furnaces run off of the municipal supply.

The Conversion Process & Important Considerations

There are different processes involved depending on which kind of furnace you are converting from but overall, the benefits of converting from oil or electric heating are many. Take a look at the following breakdown of the process so you can get a better handle on what may be involved.

1) What is your current heating system?

  • Converting from an Existing Forced-Air System – Consider yourself lucky if you have a forced air furnace system already in place in your home and if you are considering converting to propane or natural gas because if so, the process will be much easier. If you know that you have a forced air style HVAC system — such as an old oil  or electric forced-air furnace — installed you can begin the conversion process relatively easily. If you are unsure of what kind of system you have in place, you can contact a local contractor to let you know. in this case, the cost mostly amounts to the cost of the new furnace itself, plus a bit more than usual for the installation. In total, you might expect to spend $3500 – $8000 to switch from an oil or electric forced air furnace to a high-efficiency propane or natural gas system.
  • Converting from Electric Baseboard Heating or a Boiler System In this case, your home most likely doesn’t have any ductwork, which makes the switch much more complicated and costly. Installing ductwork throughout your house is a big job, and usually requires a heat-loss calculation be done by an engineer (costs about $500 – 800) in order to determine where the heating ducts will go. Then a contractor must install all the ducts and venting, before the furnace can be installed. Think carefully about whether this type of conversion is worth all the expense, as it can easily run well over $10,000 when all is said and done. Alternatively, you may be able to install ductless mini-split heat pump units instead.

2) What type of heating are you converting to?

  • Converting to Natural Gas – Natural gas powered furnaces are the most common type in Canada. Many people opt to run natural gas to heat their homes because it is more economical and tends to require less work. If you do want to convert to natural gas, you should start by getting in touch with the local gas company. The process is usually easy and involves running an extension from the main line in your neighbourhood to your home and furnace. Most gas utility companies will cover this cost, provided the infrastructure is already present in your neighbourhood.
  • Converting to Propane – One of the main reasons that people choose propane to fuel their furnaces is that they live in rural areas where natural gas infrastructure is not available. Propane tends to be more expensive than natural gas (about 60 cents – $1.20 per litre) and there needs to be a large tank installed either on the side of the house or underground to house the fuel.

Where to Start

In any case, the best place to start is by calling your local gas company and finding out which options are available to you. If you do have an electrical heater that depends on baseboards or sub-floor radiators, the process will be more expensive, invasive and time-consuming since ductwork will need to be installed by a contractor.

Once you have made the decision to convert to propane or natural gas it is very important to have a professional come out to your home and conduct a free estimate to assess your needs, and provide an accurate cost.

Based on the square footage of your home, its insulation and the number of rooms you have in it, this will determine the correct size and BTU output of furnace you will need to sufficiently warm your home.

Most likely, the process will start with having the gas utility company run a line to the main (for natural gas) or a propane company installing a tank on your property either above or below ground.

Afterwards, you can request free in-home estimates from local distributors and contractors simply by filling out the form on this website.

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Eli Richardson
1 year ago

Utilizing propane seems like a great option when it comes to heating. Thanks for pointing out that propane is easy to buy and it is cost-efficient. I will look forward to purchasing a propane tank for my furnace.

1 year ago

im looking to convert to propane from wood furnace/electric i have all duct work installed and everything just need to install a new furnace to existing ducking, im in ontario and was wondering cost and size of furnace

2 years ago

I’ve been told that the posted prices are double that of the actual cost that the installers pay. Meaning that a $3000 furnace cost the installer around $1500. Could this be True? If it is it would be nice to know what the real prices are so that we can negotiate prices based on labour. This is similar to the car price issues of the past where consumers were in the dark about the cost of a car. Now everyone who wants to know can easily get the “dealer price”. Any ideas and how to know the “dealer price” once… Read more »

2 years ago

wanted to know how much it costs to convert oil furnace to gas in 2018.

2 years ago

When converting from electrical and everything has been approved, how much work goes into it..are walls and ceilings broken into, floors pulled up or do they try too not break as much.

3 years ago

I’m looking at buying a country home that has just had a new high efficiency oil burning furnace installed in it. Can this furnace be converted to burn propane? Would the hot water heater be able to be converted to propane?

3 years ago

If the house has propane gas already how much would it cost to change it to natural gas?

4 years ago

Could you please include the option of converting a water boiler baseboard to hot water radiators?
Do you provide such service and/or consultancy on reliability of the tranformation? There are people reluctant to convert to forced air for allergy reasons and also the fact that they have piping for hot water baseboads and the best way to renovate their house is switching to new modern radiators..

thanks in advance

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