How do you guys calculate your savings?

[Hammerjoe]

I have a question that has been bugging me.

I have made a spreadsheet with the electric usage since 2005 which was the year I decided to buy the Harman Accentra, that was installed in late feb/06.
So I am tracking all the monthly electric bills and also all the bags purchased, which gives me a pretty good idea how much heating my place costs.

I have to say that the fuel calculator does not come close to my annual usage.
The fuel calculator projects savings compared to electric baseboard of approx $800.00, which would be quite accurate if I got the pellets for free, otherwise I am pretty much breaking even, I bought 140 bags this year @ $4.69/bag unless I end up using less than 140bags this season (chances are slim).

Anyway, I was wondering what would you compare this years cost to?
Do you compare to the year before you got the stove (2005) or last year, ie 2006 to calculate what your savings are?

Just for info, my excel file has the 2005,2006,2007 monthly kilowatts used, the kw price and number of bags purchased.
What I do then is I take the monthly usage for 2005 and 2006 and apply today's rates to calculate the savings and applys the price paid to buy pellets to get the final picture.
Is this the right way to do this?

 

[pegdot]

Wow! You're way more accurate about figuring this out than I am. Sounds like you are on the right track to me if you are using the current cost per kw to compare with the current cost of pellets. Of course, there is the variable of weather. If, for example, you had a mild winter one year and a bad one another.....then your method doesn't account for that but it still should give you a pretty fair idea of what your real costs are when averaged over several years.

The only other issue I see is one of strictly comfort. If you were heating your house to only 65 while using the baseboards and it's now more like 70 with the stove you'd need to calculate what that extra 5 degrees would have cost you to achieve with electric to get the complete picture.

Peggy

 

[Xena]

The calculators here and elsewhere on the net
don't do anything for me so I've done the math on my own.

My backup heat source is oil. (system replaced in 2003)
The year prior to getting my stove I used 800 gallons of oil. I take that number
and multiply it by the current cost of oil (from my oil company)
which is 3.14 a gallon right now= $2,512.00 is what I would at the very least
spend on oil if I had to heat with oil right now.

Going on three years with the pellet stove, and it takes roughly
3 tons to heat my home from Nov. to April. $218 a ton for the pellets,
plus add the $60 extra electricity the pellet stove uses = $714.00.

Obviously the first year I got the stove I didn't know what
we'd use for pellets but I still knew how much oil we normally
used and and an approximate figure on how many tons of pellets
we'd use. House temps the same (70-74F) for both calculations.
The 800 gallons is the minimum I'd use. For a cold winter it's up
around 1200 gallons or more for the season.

 

[thephotohound]

I use a similar system to Zeta. The pellet usage is the easy part... it's the electricity that the stove uses that is a little tougher to figure out. By my calculations, my stove should use approximately 330 kWh per heating season to run (based on my part time usage and blower speed), multiply that by the price I pay per kWh (don;t forget "delivery" charges!) is approximately $0.14/kWh, which equals $46.20... add that to the cost of pellets (for me it is 2 tons at $235/ton), and my annual pellet stove cost is $516.20. To continue the apples to apples comparison, we furnace owners have to calculate the cost of the burner kicking on as well (in kWh)...

 

[jjbaer]

I have a question that has been bugging me.

I have made a spreadsheet with the electric usage since 2005 which was the year I decided to buy the Harman Accentra, that was installed in late feb/06.
So I am tracking all the monthly electric bills and also all the bags purchased, which gives me a pretty good idea how much heating my place costs.

I have to say that the fuel calculator does not come close to my annual usage.
The fuel calculator projects savings compared to electric baseboard of approx $800.00, which would be quite accurate if I got the pellets for free, otherwise I am pretty much breaking even, I bought 140 bags this year @ $4.69/bag unless I end up using less than 140bags this season (chances are slim).

Anyway, I was wondering what would you compare this years cost to?
Do you compare to the year before you got the stove (2005) or last year, ie 2006 to calculate what your savings are?

Just for info, my excel file has the 2005,2006,2007 monthly kilowatts used, the kw price and number of bags purchased.
What I do then is I take the monthly usage for 2005 and 2006 and apply today's rates to calculate the savings and applys the price paid to buy pellets to get the final picture.
Is this the right way to do this?

I'd compare Mar 2005 through Dec 2005 against the same timeframe for 2006 (because the pellet stove wasn't installed until essentially 1 March 2006 and then was used the rest of the year) and then I'd compare all of 2005 against all of 2007 because these were both full years (all of 2005 was elec heat and all of 2007 will be pellet heat). I'd also use current rates to compare all three years.

 

[mkmh]

Really hard to get an accurate read on the true savings, but I use a system pretty similar to what others have posted. One thing that makes it particularly difficult to measure is that our behavior has changed now that we've got with the 2 pellet stoves. Many times I let the house get down into the 50's when we're not around...then we come home and fire everything up. Anybody who is feeling chilly just huddles round the stove while the house is heating up. My sense is that using the stoves in this way has saved us some money, but the savings has more to do with our change in behavior rather that changing from oil to pellets. I know some other pellet stove owners have pretty much gone the other direction where they keep their home much warmer now that they have the pellet stove.

At the end of the day I just kind of let go of trying to put a dollar figure on the savings. We enjoy the stoves and I feel pretty good about not writing a check to the oil company every month. the savings may not be enormous, but at a quick glance I can tell that i'm spending less on heating than the average person in Southern Maine.

 

[Kenny1]

While historical data is interesting, I think that the only way to compare is by the price per BTU delivered to your home.

I have an oil furnace, so I look at the price of oil vs pellets.

27.4305217 liters of oil containe about 1 million BTU. My furnace is about 82% efficent (according to the guys who cleaned it this year). So I can take the price of oil (cents per liter), multiply by 27.43 and that gives me the cost per million BTU. I then multiply that by 1/0.82 to get the cost per million BTU delivered to my home.

For the pellets, I know that there are about 16.4 million BTU per ton. So if I take my price per ton and divide by 16.4, I get the price per million BTU. I then assume that my stove is about 70% efficent. If I take the price per million BTU, and multiply by 1/0.70, I get the price per million BTU deliverd to my home.

After I calculate the price per million BTU for pellets, I can try different numbers for the price of oil. For my conditions, I see that when oil is 67 cents per liter, I'm better off using oil. When oil is 67.5 cents per liter, I'm better off using pellets.

This works, and is the only fair way to compare differt fuels.

Now in my case I'm using more heat with the stove. Before we had it, the basement was cold all the time. We put the stove in the basement, and it is now nice and cozy (great for the kids to play in on stormy winter days!). The main floor is also comfortable. However, with the stove, you can see we are heating more square footage. So comparing the last winter we used the oil furnance vs the first winter we used the pellet stove is not (in my case) a fair comparison.

Finally, when comparing last years heating bill to this years, you have to look at degree heating days. How cold it is outside will affect how much fuel you need to use to keep your home warm. On our oil bills, they show the degree heating days since the last fill up.

Wow, what a long winded reply. Hope it helps!

 

[GVA]

Here's my latest take on pellet/wood heat...............
For over 4 years I had my pellet stove set at 78* so that the whole house is comfortable......
I'll throw a lowball # out there of say 82% efficiency for my stove.
Now I'm in the south and have ELECTRIC FHA 100% efficient and I'm freezin'
T-stat says 73* and I'm cold WTF.......Maybe it's the slab foundations I don't know
Wood stoves, pellet stoves whatever....... They seem to heat not just the air (for a brief period of time) but the floors, the walls, the furniture........and the people.... better than any central system can.
I'll let you know though... My house (in NE) is empty and I have the T-Stat set at 64*..... Can't wait to see what my gas bill is gonna look like this month.....
And my new furnace is 92.5% efficient..........

 

[Hammerjoe]

I dont think that is an accurate calculation.
If I was basing my savings on that then I would be saving $800/year between Electricity and pellets.
Well realistically I am breaking even, actually paying more for pellets.
So why am I not seeing the savings? After all a btu is a btu.... the difference is that it depends on how much btu's you have to spend with each fuel to keep the same heat in the house.
I guess that it means that I was using less Btu's heating with electricity than pellets.
I dont know why I am not saving the money that the fuel calculator is showing??

 

[Kenny1]

I dont think that is an accurate calculation.
If I was basing my savings on that then I would be saving $800/year between Electricity and pellets.
Well realistically I am breaking even, actually paying more for pellets.
So why am I not seeing the savings? After all a btu is a btu.... the difference is that it depends on how much btu's you have to spend with each fuel to keep the same heat in the house.
I guess that it means that I was using less Btu's heating with electricity than pellets.
I dont know why I am not saving the money that the fuel calculator is showing??

Hey Hammer, I'm pretty sure my numbers are good. My point was, sometimes we change more than one thing (in my case going from oil to pellets, and going from a furnace to a stove, heating more space, and having a different weather each winter) and fail to take that into account when we look at our heating costs. If three or four things change, I cannot just compare how much I'm spending on pellets vs how much oil I used 2 years ago.

In your case, there must be something else? A BTU is a BTU, does not matter where it came from.

How about describing your house, the stove setup, and your electric heating. Do you have baseboards? Are all the rooms set to the same temps, or do you keep some areas cool? Do you have a heat pump or an electric furnace? If central heat, do you have different zones? What type of house do you have? Are you heating the house to the same temp with the pellet stove as when you were using electric? Got a basement? Is it heated? Has anything changed with the house in the last year (renovations)? Any new air leaks or insulation removed and not replaces? Doors and windows well sealed? New kids in the past year? New pets?

Also, using historical data (your bills form 2005 and 2006) will only work if this year is the same temp as the prior years. E.g. if 2005 and 2006 were warm winters, and this year is cold, you will (of course) need more heat.

 

[mkmh]

All excellent points. In particular, I have to think the colder winter must be a factor.
Personally I have used just over twice as many pellets this year Sept-today as I used last year (Sept-06 - Nov 30-06).
Last November and December were extremely warm. Not sure if you hold onto your electric bills, but my company down here list the degree days on the bill. For your situation it may be worth taking a look at this.

 

[wilbilt]

I use a very simple method.

For 15 years, I have been heating with an LPG furnace. I have a 280 gallon tank, and with the current price of LPG, it costs about $620 to fill.
That fill will last about 60 days during the cold months, so $310/month for heat.

Newly acquired (free) pellet stove uses about a bag a day when it's cold. Pellets here are about $4.50/bag. $135/month for heat.

Back when LPG was under $1.00/gallon, it would have been a tossup, but I don't see us headed back there anytime soon.

 

[richg]

I calculate my savings by envisioning hanging a moon at Hugo Chavez and Mahmoud Ahmadinejad. Multiply two butt cheeks by the number of pellets I have stored, and voila!

 

[webbie]

I calculate my savings depending on how boastful my current mood is. I consult my mood ring, think about the "alphaness" of the audience I am speaking to, and then adjust for IQ. :coolgrin:

In all seriousness, most of the above examples are what are called "personal stories". They have validity only to the particular person, house, setup, math ability and memory of the person tell them. That is why we humans MEASURE things. We have a tendency to not only exaggerate, but also to be at the mercy of the placebo effect. How else can you explain sugar pills curing just about as many people as Prozac?

Look at the ads - and the claims and testimonials for electric space heaters. Everyone knows that a WATT is a WATT, which is about 3.4 BTU. Yet you can find examples of an electric space heater performing magic.

I might find humor in this, except for this point. We have already had some poster here who - for instance - went out and bought a pellet stove because their friend told them a tale like those above. Then, next thing you know, the new buyer is here at hearth.com telling us he is burning two bags a day and not heating his house....and wondering why he spent $4,000!

I think it is important with ALL machinery and energy sources that we be somewhat accurate when "selling" the concepts. It is one thing to sell it on green and renewable, but a whole different thing to have a fellow burner use his charge card to pay $4000 when saving money is the only (or main) concern.

Keep in mind that I have been around this biz for 30 years and I heard the same stuff about wood stoves (2 logs will heat your home for 24 hours), and also about coal stoves. We have already been through one - well, maybe two, pellet BOOMS and BUSTS. If these appliances were sold more accurately and honestly in the first place, maybe the entire industry and public would have benefited more.

General rule is that Pellets save over LP and Electric in most places. Use the calculator to figure out the other stuff, and then use your mood ring to determine if you want one anyway! I have a pellet stove in my shop even though I could heat it just as easily and cheaply with NG....but I do like the local (renewable) factor (although NG is not exactly evil).

 

[wilbilt]

We have a tendency to not only exaggerate, but also to be at the mercy of the placebo effect. How else can you explain sugar pills curing just about as many people as Prozac?

...but have they cured as many people as Viagra?

Point taken on the "personal anecdote" angle. Realistically, I don't see the need to run the calcs to the nth degree and factor in all of the variables.

If I spent the time to do that, I wouldn't have time to be cold...or warm. It really doesn't matter to me what the BTU rating of brand X pellets is in comparison to LPG from X vendor.

My carcass doesn't care about what the BTU calcs are. I know when I am warm, and I know when I am cold. My wallet knows the difference between "Full" and "Empty". If I am warm right now with a full wallet, it really doesn't matter what 20 years of statistics say about how my wallet thinks about it.

I do know that pellet prices vary, and are inclined to rise and fall. I also know that for the past 25 years in this area, LPG prices have only risen.

The renewable nature of biomass fuels does strike a certain chord in me as well. I will also state that if I were freezing to death, I would not hesitate to start a pile of old tires blazing using a gasoline accellerant.

 

[Kenny1]

In all seriousness, most of the above examples are what are called "personal stories". They have validity only to the particular person, house, setup, math ability and memory of the person tell them. That is why we humans MEASURE things. We have a tendency to not only exaggerate, but also to be at the mercy of the placebo effect. How else can you explain sugar pills curing just about as many people as Prozac?

[snip]

I might find humor in this, except for this point. We have already had some poster here who - for instance - went out and bought a pellet stove because their friend told them a tale like those above. Then, next thing you know, the new buyer is here at hearth.com telling us he is burning two bags a day and not heating his house....and wondering why he spent $4,000!

I agree with you (and I'm not sure if I have the sugar pill or the Prozac ;-P ).

I don't want to drag out the "my pellet stove saves me $XX". However, at this time I am wondering about HammerJoe. He does have questions about why he does not see the savings the calculators show him. I'm curious about what has happened in his case (where are ya Hammer!).

Cheers


Kenny

 

[Hammerjoe]

I am not saving anywhere near what the calculator sugests.
And yes I went with pellets to save money.
I did study the heating market situation in the summer of 2005 and it made alot of sense to buy a pellet stove, it was the cheaper alternative after wood but without the incovenience.
At the time pellets were selling for $3.75/bag.
There was also a huge debate in this province because the local utility board wanted to increase electricity rates by almost 20% in 2006.

As for my house it is a open concept, approx 1200sq, the stove is between the kitchen and the living room facing the hallway to the bedrooms.
Picture my house like this: divide the house in four sections :
1 - 2
3 - 4

1 is the kitchen
2 is the livingroom
3 is the washroom+bedroom
4 are two bedrooms.
The stove is in the middle of 1 and 2.

It keeps the house warm, I love the heat it is no question about it better than electric heat.
I also think that 2005 was much colder than it was in 2006 and this year it has not been that cold yet..

In 2005 when I only used electric baseboards I used about 20000Kwh.
Stove was installed at the end of february/2006 and came with 25 pellet bags.

In 2006 only used 17500kwh.
This year so far I have used 10100Kwh and I am forecasting an extra 800kwh for december.

Compared to 2005 I've pretty much cut in half my electricity usage which is huge imo.
Due to electricity increases the total savings in 2006 was approx $290.00
And this year compared to 2005 it's approx $700.
So altogether total savings compared to 2005 rounded up is approx $1000.00.

My pellet situation:
In 2006 I bought 80bags@$4.29 each + shipping + tax=$430.00
In 2007 I have bought 64bags@$4.69 + tax = $252.43.
These bags were used to for the 2006-2007 winter season.
For 2007-2008 winter season I have bought 140bags@$4.69+shipping+tax=$828.
Out of those I have used so far 23bags@$4.69+tax+shipping ($11) =$135.00.

So in reviewing.
2006+2007 electricity savings = $1000.00
Pellets spending for 2006+2007 = $430+$252+$135 = $817.
Total savings so far $183.00 and this in two years...

Culprits for this?
Electricty rates did not increase in double digits as everybody thought they would in 2006. They increased only 8% and 18% for two months (july and august this year) before dropping to 15% since september (this compared to 2005).

Pellets on the other hand increased 15% in 2006, 25% when I bought my stock this past july compared to 2005 and they are now selling @ $4.99 which is 33% more than 2005.

The numbers are clear and they dont lie.
I hope this answers all your questions.
I which I could brag about saving thousands of dollars but I can't.

 

[Xena]

Well for one thing, the calculators are only
estimations. Some people could be seeing less
or more of a savings. The stove efficiency
set in the calc are not etched in stone.
If you know your appliance efficiency you
can change that number accordingly and
get a more accurate figure.

As far as foolish people who run out and buy a stove
of any kind - just because their neighbor told them
he/she saves money - well then that's their problem
for not properly researching their particular application.
Many people actually do save money over oil, electric,
and gas heat especially now with the prices of oil/gas
almost the same cost (in my area anyway), but as
everyone knows it depends on many other variables.

I had a friend who bought a stove last year, stuck it
in the basement, bought hi priced pellets, and expected to magically
and inexpensively heat a 2 family, uninsulated, old home
with old single pane leaky windows. Not happening as we all know.

 

[tinkabranc]

It does not help that the media contributes to the misconception
that EVERYONE will save 75% off their heating bill by purchasing a pellet
stove for their winter heating. This could be true for some, but is not
the norm for most. Some go out and make that purchase based on the 75%
instead of doing their research first, and then they are disappointed later if they
are not saving that much.

 

[Hammerjoe]

I dont think people are to blame when the savings are not there.
People do research. People use fuel calculators. People read forums. People use google.
What people cant predict is what the future price of the raw material is going to be.

In my example, in the summer of 2005 there was an expectation that electricity would increase the next year close to 20%.
Pellets were $3.75/bag.
After that I based my calculations on inflation increases.

How could I predict or guess that pellets would actually increase more than electricity?
All my variables have been thrown out of the window.
Yes I am still saving a little money, but it is just a little and if it continues this way I might end paying more, unless of course something happens and reverses the trend of pellets price increases.

 

[webbie]

Actually, I think the pellet makers learned a hard lesson in 2005-2006. They (admittedly - from the horses mouth) raised the price of pellets right along with the price of oil! Think about that - a fuel which takes vastly more work to use, requires an expensive appliance, and yet cost as much as the alternatives!

Does not make sense. So what happened? Well, for one, Harman went belly-up. Lots of other manufacturers ended up down 50% or more in their sales of pellet stoves. It is called Killing the Goose that Laid the Golden Egg, and it is a very typical human trait!

Corn, on the other hand, was not subject to this particular greed - instead, the government agreed to pay the producers of ethanol (another story), thereby raising the price of corn VASTLY.

Yes, the marketplace is perfect - but not for each and every one of us.

On the positive side, pellets have held to a more reasonable price here in the NE ( $200-$240), which means that some producers may have learned their lesson. But, given history, I sort of doubt it. While biomass can be a very green and local fuel, many of the pellet we burn here in the east are made in British Columbia! Also, we have no way of knowing (eventually) whether the pellet companies are part of a holding company in Dubai! After all, we've sold foreigner the rest of our country....why not the little that is left?

Ah, but hopefully they will never own the sunshine that falls here, nor the cordwood from the local forest.

 

[Xena]

Hammerjoe - Sorry to be misleading with the wording, but essentially
I meant research as far as the importance of insulation, stove
placement, and stove installation/operation.
Many times we've seen people disappointed because they were
hoping that new stove was going to compensate for lack of
insulation, and/or they install it in a less than optimal location in the home,
and/or they don't read the manual to learn how to get the most
from the stove.
I can't even count the amount of people I've seen on this forum and
others who write "My old leaky farmhouse has no insulation and drafty windows
but I'm still hoping a new pellet stove will save me money over my current
heating appliance".

 

[Kenny1]

Hey Hammer -

OK, so you pick up 140 bags (I asume 40lbs per bag) for $828 (taxes and everything in).

Thats 5600 lbs or 2.8 tons, at $295.7143 per ton.

Putting that into the calculator, we see that it works out to $26.22 per million BTU.

For comparison, electric at 9 cents per kilowatt hour works out to $26.37 per million BTU.

So if your electric is more than 9 cents per kilowatt hour, you are better off using the pellet stove.


In 2005 you used 20 000 kwh of electricity. If all of it was used for heat, that would be about 68 million BTU.

In 2007 you have forecast 10 900kWh (37.06 million BTU) and you seem to be using about 140 bags of pellets per year (another 45.92 million BTU).


So it seems that in 2005 you used a total of about 68 million BTU and in 2007 about 82.98 million BTU.

So, what has changed? Is the weather colder, are you keeping the house warmer, is there some insulation that was removed?

Not trying to give you a hard time, but I think that your savings have to be based on a per BTU basis. In your case, if electric is more than 9 cents per kWh, you are better off using the pellet stove. If it is less than 9 cents, turn off the stove and use the baseboards. However, comparing your bills when there is about 20% difference in the amount of BTUs used will not give you accurate results.

Cheers


Kenny

 

[Hammerjoe]

I am not sure how you are getting the annual btus..

The 20000kwh in 2005 was the total used not just for heating so it would be wrong to assume 20000kwh for heating, probably 10k (the difference from 2007 and 2005. although I improved the energy consumption in my house, so 10K is generous) for heating would be more correct (37million btu, how do you get this 37million anyway?) so 45million minus 37millions = a difference of 8million btu's.
Using another fuel calculator that I found on the web tells me it costs $22 per million btu for pellets with an efficiency of 80% and $28 for electricity which once again tells me that pellets would be cheaper, but here is the problem with this and that is what you are asking.
With the pellet stove I cannot direct the heat to one particular room of the house.
With electric I can turn on and off which room I want the heat to be on and this is why to have the same comfort I have to use more pellets (btu's) than with the baseboards. Do you see where I am going?
Same would apply for oil/gas/usage.
I think the problem with these fuel calculators is that they calculate the price of a btu, it doesnt account for the fact that each energy source requires different amounts of btu to achieve the same temperature.
If I was going to use the same btus with the stove then the temperature in the house would be much lower than with the same btu's with the baseboard (true that the whole house would not be warm, but thats not the point, I only need it to be warm where I am).
Anyway the truth of the matter is that I am not saving $800 as the fuel calculator suggests

 

[MrWinkey]

Well a BTU is a BTU....it's the energy required to raise the temp of water 1 deg.

It's the only way to compare how much heat energy is in a given energy source.

Yes you can save $$ because with your electric heat you can heat the room your in......

The engery calculators for the most part only figure in the cost of your overall heating.....not how much it costs to heat a room.....so yes your correct....



Most things are a gamble.....in my area I bought my pellets for the same price as last year.....now that may not happen next year because of increased fuel costs (more shipping $) so for me my electric costs went up by 15% my pellet costs are staying the same. That's the problem is nobody can predict what the future price of any fuel can be....that's why we have the futures market

Now on the other hand my Cadet in wall heaters are not very good at heating anything and most likely cost me more than running the pellet stove.....My situation my power bill was around 180 per month in the winter....with the house about 55 deg unless I built a fire. With the pellet stove I keep the house at 75 and pellets are costing me about 120-140 per month......so with my letric bill at about 50-60 bucks per month.......

Did I save $$$? Nope. House more comfortable? Yep.

I guess the point is as always...your results may vary.....