Costs and Emissions for My Electric Home

Back in late 2013, my natural gas furnace and air conditioner broke down beyond repair and needed to be replaced.  A decision had to be made: replace them with a traditional natural gas furnace and air conditioner or replace them with an air source heat pump with electric heat strip back up.  Since I live North of Chicago in a 2600 sq. ft home, I was advised against going all electric. I was told that I would freeze or that my costs would go up substantially.  Also, I was told that electric heating was worse for the environment.  The research I had done showed otherwise on these points, so, I opted for going all electric and getting off the natural gas grid.  (See previous article for new system details). At the same time, I traded in my Toyota Corolla for a Chevy Volt.

There was a learning curve in using the new equipment.  The Volt, for example, will turn on the gasoline engine at one of two temperatures to assist with heating the interior of the car.  The higher setting, at 35 degrees, uses more gas than the lower setting, at 15 degrees.  The default is 35.  It was several months into the first winter before I realized that the setting existed – the controls on the Volt are a lot more complicated than on the Corolla.  Setting the heating assist temperature to 15 cut my gasoline use substantially.

With regard to the heat pump, there are also many controls which effect the amount of energy used.  As with the Chevy Volt, it took some time to understand the optimal settings for the unit.  Additionally, I was not aware that, as an all electric customer, I was eligible for a electric space heating delivery charge discount of $.0125/kwh from my electric company.  It was not until recently that I could get an accurate comparison of annual costs and emissions of the old system vs. the new system.

Below is a table showing the costs and emissions associated with three different approaches. Scenario one assumes all traditional gas appliances and a Toyota Corolla driven about 10,000 miles.  Scenario two is the same house but with a Chevy Volt, also driven about 10,000 miles.  The last column shows my actual results for an all electric house (there is NO gas connection!) and a Chevy Volt driven about 10,000 miles.  In all three cases the house is assumed to be kept at 72 degrees year round with no additional heating sources and two occupants, including a teenager with friends over regularly.

Year Ending 9/16/2016 Gas Furnace
and Toyota
Corolla
Gas Furnace
and Chevy
Volt
Electric
Heat Pump
With Chevy
Volt
Cost $2,070 $1,636 $1,527
Emissions:
Current Grid
21,416 lb. 18,923 lb. 18,367 lb.
Emissions:
Renewable Grid
17,078 lb. 10,631 lb. 745 lb.

The costs and emissions for the Gas Furnace systems assumed 845 therms spread throughout the year based on my previous use patterns and heating degree days for my zip code (60030) as provided by weatherdatadepot.com. Costs were derived from rates provided by Northshoregasdelivery.com. Costs for the electricity included under the traditional columns is my previous estimated cost of $489 for the year.  For those two columns, emission calculations assumed 4500 kilowatt hours of electricity per year.  Emissions per therm are a standard rate of 11.7 lb. per therm. Electricity CO2 emissions are 0.964 lb./kWh as stated in ComEd’s Environmental Disclosure Statement for March 31, 2016.

The Corolla was assumed to use 367 gallons of gasoline. CO2 emissions per gallon of gasoline is assumed 19.6 lb. per gallon and average cost of $2.20 per gallon was assumed.  The gasoline use of the Chevy Volt for the year was based on an actual expense of $99 with an average cost of $2.20 per gallon. Energy used for charging the Volt was about 4100 kWh for the year.

Costs and emissions shown in the last column were from actual bills with electricity use of 18,284 kilowatt hours.  Because I use ComEd’s Real Time Pricing, I purchase my electricity at very low wholesale rates.  With this program my gross rate, that is after taxes, customer fees and delivery, is about $.08/kWh. The costs shown do not include renewable energy certificates which effectively drop the emissions to zero. Voluntary wind renewable energy certificates are currently about $.02 per kilowatt hour.  For my electricity use this would equal about $360 and would effectively make my electricity emission free.

The primary reason converting to an all electric system is that as more zero carbon energy sources added to our grid, the closer our grid will get to being 100% renewable and emission free. The emissions listed in the far right column for an assumed renewable grid are only 745 lb whereas, even with a 100% renewable grid, staying on the natural gas grid leaves me with an unacceptable CO2 emissions of 10,631 lb.  We cannot make the natural gas grid emission free.  Our electric grid, however, is getting better.  Both solar and wind are getting less expensive as is storage technology.  By using an all electric system today,  my emissions are lower as are my costs. As time goes on our electric grid will move in the direction of an all renewable grid.  Things are getting better!

Why Elon Musk Should Be More Concerned With the Mundane

Sure, we are all impressed with Elon Musk and his Tesla cars. And now he has created quite a buzz with his Tesla Powerwall battery. Impressive. And expensive. The total investment for the 7 kilowatt hour (kWh) system is estimated to be $7,140 installed. The battery is guaranteed ten years. And you save at most $255.50 per year using it every day, assuming 7 kWh per day with a $.10 per kWh spread between charge and use. Over the ten year warranty period you make back $2,550 of your $7,140. Ouch. There are, however, more mundane products that provide a better investment and have a more positive impact on the environment. I’m talking about the rather mundane electric heat pump.

Heat pump? Good luck selling that idea. You may see celebrities and tech gurus driving around town in a Tesla. But it is a little bit difficult to drive around in a heat pump – let alone look cool while driving one. Getting the word out that electric heat pumps are a better option for home heating (and high efficiency cooling – they do that, too) than is a natural gas powered furnace is not easy, especially without the high profile cheerleaders. The benefits of heat pumps, however, are great, including low cost of operation. And, in terms of environmental benefits, no other consumer product, not even solar panels or the Tesla electric car, beats heating a home with a heat pump powered by grid sourced wind power. The reason is that natural gas has some serious issues that heating with wind avoids.

For one, natural gas is a very potent greenhouse gas. Pipeline leaks releasing methane are common – and sometimes lead to explosions. Second, production of natural gas, especially when produced by fracking, is associated with severe water pollution. Finally, natural gas emits a lot of carbon dioxide when burned.

Until I shut off the gas and got off the natural gas grid, natural gas use in my 2,600 sq. ft. home was responsible for an average 10,641 pounds of CO2 emissions annually, or about 44% of my total CO2 emissions. My auto CO2 emissions averaged 7,300 pounds each year, while my household electricity use contributed only 6,520 pounds. This scenario is the same for many other people in the Chicago area, where I live. Carbon dioxide emissions from burning natural gas is often the greatest source of CO2 emissions for homeowners. This is somewhat troubling in that natural gas is being marketed as a clean fuel – it is not. It is possible, though, to effectively bring household CO2 emissions to zero.

The solution is to replace natural gas appliances, only after they break down beyond repair, with the most efficient electric appliances available and then power those appliances with wind power. By waiting until the appliances break down to replace them, not only does the homeowner get the most out of the old appliances, but, as time goes by, better, more efficient appliances appear on the market. In this way, you get more for your money.

Think of it this way: The better the return on the equipment, the more money available to invest in other energy saving ventures, i.e., I will have more money to buy more solar panels in the future, thus having a more positive impact on the environment. It is generally better to wait as long as possible to replace equipment. For example, 20 years ago, when my house was built, electric heat pump water heaters were not an option. Plus, heat pumps for home heating did not have the low temperature performance in terms of efficiency or capacity to make them practical. Today, however, heat pump water heaters are the most cost effective and environmentally friendly way to heat water. And, today’s air source heat pumps are more efficient than ever. Plus, they still pump heat at minus 15 degrees Fahrenheit. Getting off the natural gas grid has never been easier!

My opportunity to get off the natural gas grid came in 2013 when my gas water heater and furnace broke beyond repair with the air conditioner looking soon to follow. My power-vent water heater was replaced by a GE GeoSpring heat pump water heater. My 125,000 BTU furnace and my 18 year old air conditioner were replaced with a 4 ton Carrier GreenSpeed heat pump with a 10KW backup heat strip. The heat strip is only used for temperatures below 5 degrees. My washer also broke down. I replaced it and the dryer with a matching set from LG. I chose this pair because they stacked and because the dryer is an efficient vent-less condenser dryer. Finally, my gas oven with a non-functional broiler was replaced by an electric convection oven with a ceramic smooth top. This will eventually be replaced by an induction oven, which is as convenient and responsive as cooking with gas.

The difference in cost between what I purchased and what comparable gas appliances would have cost was not much in total. The heat pump water heater did cost more than a power-vent unit and my electric service did need to be upgraded. The Carrier heat pump with the air handler cost about the same as had I bought a high efficiency furnace with a matching high efficiency air conditioner. The total additional cost for everything I bought was about $1,500 compared to what more traditional replacements would have cost.

So, what did I get with that $1,500 investment? First, my expenses are lower. Shutting off the gas eliminated the $300 annual gas company customer fee. Also, going all-electric lowered my electricity delivery fee by $.0125 per kWh. I also benefit from being on ComEd’s Residential Real Time Rate program. Since the heat pump is used more in the middle of the night when rates are low, my cost per kWh stays low. My average rate over the last year, with taxes and delivery included, but not including customer fees and other non-variable items, was $.073 per kWh. On average, my annual household savings are estimated to be $200 to $300 – and that is while keeping my house at 70 degrees all winter.

There are other, more subjective advantages. I am more comfortable. Elimination of the gas clothes dryer and the power vent water heater eliminated two large sources of outside, unconditioned air infiltration: I am warmer in the winter. For the same reason, the indoor humidity level is lower in the summer. Since the humidity level is much lower in the summer, there is much less opportunity for mold to grow in the house – that means better health for everyone in the house. Finally, I’m safer. There is no indoor fossil fuel consumption so there is no chance for carbon monoxide poisoning. There are no unburned hydrocarbons from a gas oven. There is no fire risk from open flames from the cook top or fire from a clogged clothes dryer vent. And, unlike my neighbor’s house that filled with gas from a gas leak, there is no risk of the house blowing up. The more impressive investment return, though, is that I can power all of this with renewable wind energy, thus reducing my CO2 emissions to zero.

Wind energy is available to anyone through the purchase of renewable energy certificates. Renewable energy certificates were developed to encourage development of renewable energy power generation. With wind power, certificates are awarded to wind producers for wind energy added to the grid. Strict accounting standards are in place to assure that the number of certificates awarded to a producer matches the amount of power added to the grid. This way the certificate holder knows that their purchase was for wind power added to the grid, primarily displacing electricity produced through burning coal or natural gas. The certificates can be subdivided and sold to utility customers who want their power to come from wind. This is the standard mechanism for which green energy companies lay claim to providing renewable energy or how corporations lay claim to being 100% wind powered.

Here’s how it works for me: I buy shares of certificates totaling 15,000 kWh per year. The shares cost me $.02 per kWh. The purchase is through a third party with no connection to my electric utility. Keeping the two transactions separate has the same environmental benefits as if I were to buy from an alternative renewable energy supplier. There is, however, a benefit to buying certificate shares separately: I am cutting out the middle man thus getting my wind power for the absolute lowest cost. Since my house, on average, will use less than 15,000 kWh per year, my house is effectively 100% wind powered and emission free. So, going off the natural gas grid saves me $200 to $300 on my regular utility bills and the extra cost for the wind renewable energy certificates is $300 per year. After my original extra investment of $1,500, the ongoing net cost for reducing my whole house CO2 emissions to ZERO is less than $100 per year (10 year cost less than $2,500). Compare that to the Powerwall ten year cost of $4,590 with no reduction of CO2 emissions: The heat pump powered by wind is the clear winner!

The trend has already been established: Heat pumps are coming down in price, becoming more efficient and are taking a greater share of the home heating market. This development, in conjunction with an increasingly cleaner electric grid, will lead to great environmental benefits. The benefits are even greater when home owners advance wind energy production by buying renewable energy certificates to cover their heating load. Winter electricity use, however, does increase dramatically, especially on very cold days, posing a challenge for grid operators. We will meet this challenge as the grid is improved and as our homes become more efficient. Using heat pumps may not be sexy, but, they are an important part of reducing our green-house gas emissions. The word needs to get out. Perhaps Tesla can get into the heat pump business. Perhaps Elon can somehow find a way to make it cool to drive one around town.

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