True potential cost savings when buying a furnace in Kitchener Waterloo
February 25, 2013
Last week I received an email from a client, who I was speaking to, about replacing her furnace in the Kitchener area. She had been in contact with two other contractors. What alarmed me was the information she received from these sales contractors representing the two national heating and cooling companies.
Here are the alarming pieces of her email:
(from his email) “I talked with my Sales Manager about the quote on the Dave Lennox Signature furnace and Elite line A/C, with the humidifier and air cleaner, (and with the Condensate pump included in price, which I mentioned to your wife). And he said that we will give you a much better price, and a better (insert incentive), if that is still an interest to you. If I would calculate the true cost of ownership for your old furnace, in those 2 years that you are thinking to keep it you would overpay on gas and hydro bills around $2000. Which you could use towards a new furnace now, with all the (insert multiple incentives), that may not be around in the next couple of years.” I think his estimate of savings on our gas and hydro bills was a bit inflated. It probably won’t surprise you that when we spoke with the representative from (national company B), compared to the guys from (national company A) they looked like paragons of ethical behaviour. That’s one of the reasons I contacted you again.
The part that was of particular interest was the estimated cost savings of $2000 over 2 years. As much as I would love this to be true for a number of reasons, it simply isn’t.
This homeowner had a 10 year old furnace operating at its designed efficiency of 92% and in safe condition (which was verified with a $45 tune up from Hogg Mechanical).
The proposed furnace she was looking at was an up to 98% efficient model with an ECM variable speed motor. She lives in a home built before 1990 and considered a somewhat “loose” house.
Here is a breakdown of the math:
92% vs. 98% = a 6% savings on gas
An ECM motor will use approx. 1/3rd the hydro of a non ECM motor.
In this chart supplied by SNAP Financial (Calculations based from National Resources Canada Office of Energy Efficiency) which assists in determining cost savings from old to new heating and cooling equipment, in this case the calculation of savings equals $20 a month. Which works out to $240 a year or $480 over the next two years. This is a far cry from a savings of $2000 over two years.
When replacing equipment there are a number of factors to consider. Return on investment, although important, is a “nice to have”, rather than a “reason to act” when continuing with a forced air furnace. There are a number of options such as hybrid systems or geothermal that can deliver greater payback, please see Ecohome Technologies for more information. If replacing an old furnace, that is not operating well or is facing impending failure, there are a lot of excellent solutions that can offer peace of mind, while reducing over spending on utility bills.
Beware of claims that seem too good to be true! When the time comes to replace your equipment, a contractor with your best interests in mind, should be able to back up cost saving data with third party literature.