Quick Math Check Propane vs Natural Gas

[myles]

Hey Guys! Can someone please double check my math on this propane vs natural gas comparison:

Current propane prices used: $1.00/ Liter (we are in Canada) this is my average current delivered price for propane.
Current natural gas prices used: $0.3592 / M3

In order to calculate this properly I beleive the best way is to calculate how many BTU i am getting for 1 cent.

So i did this:
Propane is approximately 25,000 BTU / Liter. 25,000 / 100 = 250 BTU Per Penny
Natural gas BTU Per m3 is approximately 35,300 / 35.92 = 982.74 BTU Per Penny.

Why I am doing this, I have access to natural gas to my house for all my heating loads, I just have to pay to put the line in (Around $15,000.00). I am burning about 950 liters of propane per month in the coldest seasons, which is expensive to say the least. This covers hot water, cooking, drying clothes, and heating about 3500 sq ft of concrete slab. So i am in essence using 23,750,000 btu per month to heat the structure, which sounds like alot, but in all acutality is about 32,986.11 btu per hour over 30 days, at -20*C, and some days colder this seems to be not bad!. Now lets compare my almost $1000 per month propane bill to what natural gas would cost:

Propane bill current: 950 liters * 1.00 = $950.00

Natural gas bill projected = BTU Useage 23,750,000 / 982.74 =24, 167 * 0.01 = $241.67

that is a large difference for me. Now we calculate how long to pay off this trenched line:

There are about 4 cold months of the year here average that i would use maximum heating loads, then when there is enough sun the solar kind of takes over most of the loads, so i'd say i'll use about 5.5-6 "cold" months propane useage per year (could be higher if its a cold year)

projected annual propane budget worse case: 950 * 6 = $5700.00

projected annual natural gas budget worse case: $241.67 * 6 = $1450.02

Difference of $4249.98. break even point of 3.5 years. this assumes prices don't change, and they will as natural gas is seen more as a bad thing to use for heat, but where we live currently its controlled by a utility board for the whole province and they are regulated and very stable. Propane however is not regulated as stringently and this price can shoot high and low with volatility over night almost.

Seems like a no brainer to me, please chime in!

 

[SparkyJJO]

Natural gas wins every time, cost wise. We look at break even time periods of longer for solar systems, so I'd say if you have the funds to do it, then do it.

Bear in mind you'll have to change a few parts on all your gas appliances to run the natural gas (typically just the jets).

Something else to keep in mind is natural gas runs at a lower pressure than propane. Not sure the size of the gas pipe in your house but hopefully it isn't too small to work right with natural gas otherwise you may need to change the pipes out.

 

[myles]

Natural gas wins every time, cost wise. We look at break even time periods of longer for solar systems, so I'd say if you have the funds to do it, then do it.

Bear in mind you'll have to change a few parts on all your gas appliances to run the natural gas (typically just the jets).

Something else to keep in mind is natural gas runs at a lower pressure than propane. Not sure the size of the gas pipe in your house but hopefully it isn't too small to work right with natural gas otherwise you may need to change the pipes out.

Thank you, i'll confirm the lines in the house first for sure. I kept all my natural gas converted parts for all the appliances and generator etc in the house incase I ever wanted to convert. But firstly i'll check the gas lines in the house for the dryer, and the stove.

 

[12VoltInstalls]

Propane comes from crude oil when it is striated/cracked/distilled to produce various fuels, solvents, and lubricants.
(edited due to corrected information in later posts)
You can easily produce too much propane (hard to store) when diesel, #2, bunker, and gasoline maintain demand and heating season is mild.

So what you really are deciding on is whether you have faith in the greedy I mean bribed politicians to not justify raising NG rates for the benefit of their benefactors within your payback window. At a 1:4 ratio and <4 year ROI it seems reasonable- unless Canadia wants to ramp up European exporting where the market will demand a higher price locally to meet government expectations.

What a weird world we're in

 

[RV8R]

I’m in BC

When electricity prices increase it seems natural gas does also.



The other aspect, I did not catch above is the increased property value due to having a $15K utility service installed. That increased your property value.

We have BC Hydro & Fortis to our house. Natural Gas for furnace backup (we primarily use a heat pump), gas stove, fireplace, dryer, HWT, BBQ.

I think you are comparing straight BTUs per $$. There are other factors like efficiency of the appliance.

Sometimes there are rebates for switching over to various fuels.? So there is that game also.








So 947817 / $13.86 = 684 BTUs per penny ?.



The other consideration “in Canada” is the specifications of “Measurement”. In Canada it falls under this Agency;

Measurement Canada - Home

Measurement Canada - Homepage

www.ic.gc.ca

Why is that important? We actually buy energy by weight as energy is measured by specific energy “weight”, but when we are at the gas pumps we think we buy per L. The density correction is to the temperature of 15C IIRC.



So ,,, Check Your Math? Show me the Natural Gas Utility monthly cost as per my example above & I will check that 1st. You are getting 44% more natural gas for the same Canuck Buck than me. Maybe we are just getting screwed in BC ,,, well of course we are but by how much ?.

 

[myles]

I’m in BC

When electricity prices increase it seems natural gas does also.

View attachment 127916

The other aspect, I did not catch above is the increased property value due to having a $15K utility service installed. That increased your property value.

We have BC Hydro & Fortis to our house. Natural Gas for furnace backup (we primarily use a heat pump), gas stove, fireplace, dryer, HWT, BBQ.

I think you are comparing straight BTUs per $$. There are other factors like efficiency of the appliance.

Sometimes there are rebates for switching over to various fuels.? So there is that game also.

View attachment 127918



View attachment 127919


So 947817 / $13.86 = 684 BTUs per penny ?.

It looks like BC prices out there gas alot differently than manitoba:

Natural gas​

Rates effective November 1, 2022​

Effective November 1, 2022, the Gas Commodity rate is 23.96¢/m3.

Residential natural gas rates

Charge	Cost
Basic monthly charge	$14.00
Gas Commodity	23.96¢/m3
Delivery	11.96¢/m3
Delivery is the total of: Transportation to Centra charges at 4.52¢/m3 plus Distribution to customer charges at 7.44¢/m3.

 

[RV8R]

It looks like BC prices out there gas alot differently than manitoba:

Natural gas​

Rates effective November 1, 2022​

Effective November 1, 2022, the Gas Commodity rate is 23.96¢/m3.

Residential natural gas rates

Charge	Cost
Basic monthly charge	$14.00
Gas Commodity	23.96¢/m3
Delivery	11.96¢/m3
Delivery is the total of: Transportation to Centra charges at 4.52¢/m3 plus Distribution to customer charges at 7.44¢/m3.

Well Ya ,,, There is the BC factor ,,, “Bring Cash” or the Sunshine Tax ?

So where your math might be out is in the fine print from Centra ,,, just like my above example, I missed “mathing” in the “applicable taxes” & franchise fees ?.

Just be careful of “Utility Companies” not showing the full picture. Taxes or Whatever else gets added into your bill after “you are on the pipe”. Like oh ya the gas line maintainance fee , or we just want more money outta ya fee, & other “got ya” fees.



Still, in the end & if you feel your property value will increase with a new natural gas connection to your home, it looks like a “no brainer” to me to go Natural Gas.?

 

[740GLE]

And propane doesn’t have “hazmat” and transportation and fuel fees? Everyone wants to get their blood.

Propane is the only fuel source locally that can adult very in price depending on your usage and how much to complain. You use 2000gal a year you can get a different rate per gallon than someone using 50 gallon. Try that with heating oil or cord wood or natural gas won’t work.

In the North East Natural gas for heating is locked into fixed rate structure set for the year which is “approved” by state regulators. Propane not so much, so much fluctuations in supply and demand. They we’re going to charge me >$8/gal when I tried to fill up our accessory stove 100gal tank winter of 2014 when there were propane shortages. Was a hard pass on that.

 

[12VoltInstalls]

In the North East Natural gas for heating is

Because the pipeline people and pawlitations collaborated and worked natural gas up as a ‘utility’ rather than a commodity. The piping infrastructure is expensive but over time it is not only inexpensive but is sucked up by the municipalities for monetary purposes that aren’t specifically oriented to actual ledger entries.

Natural gas is the least expensive common fossil fuel; coal is nearly unused.
I think the three least expensive heating sources from least to more expensive per btu are still wood, coal, and natural gas in that order.

 

[45North]

I'd look at the convenience factor too:

• NG is piped in, never runs out, no space taken up with a storege tank
• Propane tank runs out, gets periodically refilled by a truck
• To me propane is a temporary solution while rural folk are waiting for the NG line to come by.

What about your neighbours? Can you split the cost of the line extension with them?

 

[John Frum]

I'd look at the convenience factor too:

• NG is piped in, never runs out, no space taken up with a storege tank
• Propane tank runs out, gets periodically refilled by a truck
• To me propane is a temporary solution while rural folk are waiting for the NG line to come by.

What about your neighbours? Can you split the cost of the line extension with them?

On the other hand once you have the propane its yours and has very long shelf life.
If someone turns off or damages the natural gas distribution network you are out of luck.

 

[SparkyJJO]

Put in natural gas.
Keep your large propane tank.
Fill it when prices are low and when you have a few extra bucks.
If something bad happens, switch the connection back to your propane tank and change the jets back over.

 

[Llaves]

I kept all my natural gas converted parts for all the appliances and generator etc

Most generators produce lower output with natural gas than propane. For my Kohler 14RCA the difference is about 15%. This only matters if you were maxxing out your generator.

 

[Llaves]

Propane comes from crude oil when it is striated/cracked/distilled to produce various fuels, solvents, and lubricants.

most propane (70% according to this source and others) comes from the processing of natural gas. Since it's a by-product of natural gas production, it's price will vary with the relative demands of propane and natural gas. As natural gas production rises the amount of propane increases. If this increase is larger than the demand for propane the price will drop even as natural gas prices may increase. But propane demand is very seasonal, which complicates matters even more.

 

[Llaves]

Put in natural gas.
Keep your large propane tank.
Fill it when prices are low and when you have a few extra bucks.
If something bad happens, switch the connection back to your propane tank and change the jets back over.

this exactly what I did. My gas supply is raw wellhead gas so there is no guarantee that it will be delivered. I can convert my boiler in a minute or two. Same for my stand-by generator. Interruptions are rare, but of course always occur when it's coldest - well below zero F.

 

[740GLE]

Because the pipeline people and pawlitations collaborated and worked natural gas up as a ‘utility’ rather than a commodity. The piping infrastructure is expensive but over time it is not only inexpensive but is sucked up by the municipalities for monetary purposes that aren’t specifically oriented to actual ledger entries.

Natural gas is the least expensive common fossil fuel; coal is nearly unused.
I think the three least expensive heating sources from least to more expensive per btu are still wood, coal, and natural gas in that order.

In the land of invester owned utilities no municipality are buying up service territories from the Utilities.

Merrimack Valley gas explosions - Wikipedia

en.m.wikipedia.org

No local town municipality wanted this service territory. Investor owned utility bought it up with a heavy hand by state regulators.

Also piping is inexpensive until maintenance and system upgrades are needed, you know that O&M factor that’s easy to delay as it eats into profits. A lot of lines have been in the ground for over 70+ years and should have been replaced at least once.

As for cost of installing gas lines yeah it’s expensive, but so is running primary voltage for electric customers, it’s about 10k a pole set/span.

If I had natural gas running up my street and it cost me 8k to run the line into the house (and I needed a new furnace) I’d pony up the cash, even though we heat with wood with oil back up.

 

[12VoltInstalls]

In the land of invester owned utilities no municipality are buying up service territories from the Utilities

I didn’t say that.

most propane (70% according to this source and others) comes from the processing of natural gas.

This is something I never heard of before. Not that I keep up on it; not my field.
But thank you for the clarification

 

[740GLE]

I didn’t say that.

This is something I never heard of before. Not that I keep up on it; not my field.
But thank you for the clarification

So what does this mean?

“The piping infrastructure is expensive but over time it is not only inexpensive but is sucked up by the municipalities for monetary purposes that aren’t specifically oriented to actual ledger entries.”

Sorry for my misunderstanding the point you were trying to make

 

[12VoltInstalls]

So what does this mean?

Politicians love utility companies. They can tax it, accept indirect bribes, manipulate legislation to benefit their friends who want services to be more attractive. Truck delivery of products doesn’t qualify as a utility because there’s no infrastructure to manipulate.

I’m curmudgeonly biased. Watched too much local politics play out the last thirty years.

 

[Gordonthefreeman]

On the other hand once you have the propane its yours and has very long shelf life.
If someone turns off or damages the natural gas distribution network you are out of luck.

We had a large tornado in the town I work in about 10 years ago. The number of customers who couldn't comprehend why their generators had no fuel was maddening. The pipelines were destroyed, the gas service is turned off to the town. Unless you can locate a propane tank your generac is dead in the water