Estimating the payback of your new furnace is an important decision that requires careful consideration. Use this how-to guide to help you choose which system is right for your Minnesota home.
Factors to consider
Important factors for your new furnace are initial investment, estimating payback time, and quality of manufacturer and warranty. You’ll also want to consider the energy source, energy efficiency and sizing the furnace.
Energy source & energy efficiency
First, decide which energy source (natural gas or oil) to use for your new furnace. If you have a choice of natural gas or oil, natural-gas furnaces are typically more energy efficient, and have a higher AFUE rating (annual fuel utilization efficiency). In addition, in the current market, natural gas is much less expensive than oil.
AFUE measures how much fuel is converted into heat in a furnace. A system with an AFUE of 95 percent means 95 percent of fuel energy becomes heat. You may easily compare the AFUE of different furnaces using the EnergyGuide Label.
Sizing your new furnace
An HVAC professional should calculate your home’s heating requirements using the standard industry protocol Manual J – a room-by-room heating load calculation. Correctly sizing your new system is important for three reasons:
- You won’t waste money on a larger furnace than you need
- An undersized furnace won’t heat your home adequately
- An oversized furnace cycles on and off frequently, which wastes fuel and provides uneven heating.
Payback time
Fuel prices fluctuate for a score of reasons: the season, supply and demand, type of fuel, region, and environmental. In general, the higher the fuel prices, and the greater your home’s heating load, the more sense it makes to go with the highest-efficiency furnace that’s within your budget.
Use this example to help calculate payback time:
Furnace “A” is rated 95 percent AFUE and costs $2,600. The ancient furnace to be replaced is rated 65 AFUE. Initial investment payback in years equals: cost of furnace “A” divided by the annual fuel savings. If your annual fuel bill is $800, furnace “A” would save $253 per year over your old system.
In this example, it would take a little more than 10 years to see a return on investment.
Contact Marsh Heating & Air Conditioning today for more information about buying a new furnace for your Twin Cities area home.
Our goal is to help educate our customers in Minneapolis-St. Paul, Minnesota about energy and home comfort issues (specific to HVAC systems). For more information about furnaces and other HVAC topics, download our free Home Comfort Resource guide.
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