Can my furnace pay for itself with energy savings?

One of the most commonly asked questions we receive when people are thinking of replacing their furnace is, “Can my furnace pay for itself in energy savings?”  A lot of homeowners want to know what kind of return on investment they will get from the purchase of a new heating system.  The answer is, “It depends.”

As of July, 2019, the federal government requires all residential furnaces to come with an ECM (short for Electronically Commutated Motor) or “energy-efficient” fan motor.  Most furnaces made and installed prior to 2020 came with a PSC (Permanent Split Capacitor) or “standard” blower motor.  This change was made in an effort to reduce electricity consumption to lower the greenhouse gases produced by the united states.  Regardless of where you stand on the climate change issue, an ECM fan in your furnace means money in your pocket.  The department of energy performed a study several years ago and they found that the average home could save about $250 per year on their electricity bills between the heating and cooling seasons.  That means if you paid $4000 for a new furnace, it would pay for itself in 16 years.

$4000 / 250 = 16

If you paid less than that, it would have an even quicker ROI.  Sounds pretty simple, right?

Well, maybe.  ECM motors have been around for over a decade in higher-end equipment.  This means that if you replaced your furnace in the last ten years and sprung for a premium option, you likely already have this feature.  If you went with the mid to low range option, or if your home was recently built (builders are always cheap on the hvac equipment), you probably have an old-timey, PSC motor.

“My furnace is relatively new.  Can I just change the fan motor without replacing the whole furnace?”

You betcha!  Most furnaces can be equipped with an aftermarket ECM motor for somewhere between $700 and $1200 depending on the equipment and the company doing the work.

What about gas savings?  Well, that also depends.  If you are fortunate enough to be connected to natural gas, your gas bills are probably fairly inexpensive compared to those on propane.  Propane varies widely in cost from year to year, but is always much more costly than natural gas.  You could conservatively estimate a 10% savings in either case by switching from an 80% efficient furnace to a 95%+ efficient furnace.  How do you know which efficiency furnace you currently have?  This is done by finding your AFUE rating, which stands for Annual Fuel Utilization Efficiency.  In simple terms, it means what percentage of the heat made by your furnace stays in the home, versus going up the chimney.  You may see the AFUE rating on a yellow label on the side of your furnace, but these labels are often removed when the furnace is installed.  Look at the two photos below.


If you have the metal vent pipe shown coming from your furnace, then your furnace is 80% efficient.
If you have the plastic pipes shown here, your furnace is at least 90% efficient.


Can you see the difference?  Either way you could see some savings on your gas bills by upgrading, but it may not be as substantial as the electricity savings if you have natural gas.  When you add up all of this, it makes a pretty compelling case for having a conversation with your HVAC company about what you can do to save some money on your heating and cooling bills.  Give us a call at 616-383-4625 to have our experienced staff help you with your heating and cooling needs!  At Lumberjack HVAC, We make your home feel good!

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