Keep Warm This Winter: How to Save Money on Oil Heat

how to save money on oil heat

If you are heating your home with heating oil, you know that prices can fluctuate wildly over time. I personally have an oil furnace, and I’ve paid anywhere from $1.95 per gallon up to near $3.00 a gallon in a three-year time span. So, what can you do to save on fuel?

How to Save Money on Oil Heat

Unfortunately, the short answer is not much. You are locked into paying whatever the going rate is at the time you buy it.  I’ve been able to save a few pennies a gallon by buying larger quantities, but it hasn’t added up to anything significant. I’ve also noticed that there isn’t much seasonality to oil either. Buying in the middle of summer won’t really save you much unless the oil market, in general, is down. You will need to look elsewhere for savings.

Check the Furnace

The age and condition of your oil furnace will have a huge impact on your oil consumption and the comfort of your home. It’s important to follow a regular maintenance schedule to keep your furnace running at peak efficiency. If you are handy, you can do most of the work yourself, but I recommend a trained and licensed professional if you are not comfortable doing the maintenance.

How Old is Your furnace?

If your furnace is older than 12 years old, it may be losing efficiency and burning more oil. It is a good idea to budget for a furnace replacement if you are living in an older home with an older HVAC system. The dead of winter in an emergency is not a good time to go furnace shopping. Plan to have it done on your schedule and budget accordingly. In the meantime, keep up with regular maintenance to keep things running as efficiently as possible. At somewhere between $3000 and $5000 for a brand-new furnace, it pays to have regular service and maintenance performed.

So, how much oil does the average furnace burn? There is no easy answer to this since it depends on the age of the furnace, the climate where you live, the square footage of your home, and what the thermostat is typically set to.  On average, you’ll use 0.8 to 1.7 gallons per hour of operation. That works out to somewhere around 2 to 5 gallons of fuel per day. With the wild price fluctuations of fuel over time, it can go from relatively inexpensive to rather pricey to heat your home in a short time frame. This makes regular cleanings and maintenance even more critical.

Other Areas in Your Home to Consider

Do you notice that some rooms in the house are too warm while others are chilly? This could indicate a bad blower and/or a bad ductwork design (assuming you have a hot air system.) If you don’t want to make the major investment of a totally new furnace, then you can save a little by upgrading an aging blower or upgrading your ductwork. Both are expensive, but they are cheaper than a new furnace, and either option can help distribute heat more evenly and efficiently. This will lead to a more comfortable home and less oil consumption.

Home Improvements

If your house is older, you may have inefficient windows, doors, and insulation. An upgrade in these areas will greatly improve efficiency to your home. Be aware that these are major upgrades and are expensive. But, long term they will eventually pay for themselves. Like a new furnace, these items should be budgeted for over time.

Budget-Friendly Fixes

What can you do in the short term? Luckily, there are several budget-friendly fixes that you can do to help with oil consumption.  One of the easiest is changing your furnace filter on a regular basis – monthly is a good idea during the winter. A furnace filter is readily available at most big box retailers and is less than $10. Changing one usually requires no tools, and only a takes a few minutes. When your HVAC system can breathe easier, it will be more efficient.

A few other quick fixes include adding weather stripping around doors and windows, covering windows with plastic film, and putting draft stoppers on your doors. All these products are relatively inexpensive and are available at most retail outlets.

A programmable thermostat is also a must-have. You can pick one up for around $50. Setting the temperature to rise and fall based on when you are home and when the house is empty will have a huge impact on fuel consumption.

How I Save Money on Heating

I’m going to share a few of the steps that I’ve taken to help with efficiency in my own home. I have an oil furnace, so I have some real-world examples I can share.

  • Use a programmable thermostat. The temperature is set to go to 65 during the day when the house is empty and again at night when everyone is under the covers sleeping. It goes to 70 in the afternoon and evenings when we are home.
  • Schedule regular maintenance for the furnace. Every season, I will clean the furnace thoroughly and replace the oil filter.  I also add stabilizer to the oil tanks. I’ll change the air filter monthly during the winter.
  • Stop some of the drafts coming into the house. Plastic sheeting went up on all the basement windows. I installed weather stripping around the garage doors, and placed draft stoppers at the bottom of the entrance doors.
  • Insulate all my ductwork in the basement. This helps to hold in the heat as the air travels through it on its way to the upstairs living spaces.

All in, I probably spend a little over $200 doing everything. It’s honestly hard to say how much efficiency and cost savings I picked up because there are so many factors at play. But, I’m confident that staying on top of maintenance and doing some basic weatherproofing has helped keep my house warmer and more efficient.

In Closing

The bottom line is that if you are heating with oil the best way to save money is to make your HVAC system and your home more efficient. Oil is a commodity, and you are locked into paying the going rate in your area. You can do some simple cost-saving tasks such as putting up weather stripping, or you can make major investments in your home and install new windows, insulation, a furnace, and doors. All will help keep your house warm and your wallet a little fuller.

How do you save money on heating? Share your ideas in the comments below.

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