One of the biggest concerns of homeowners is cutting costs and improving energy efficiency. Replacing a furnace is not usually a concern with newer homes. However, the older your home gets, the more aware you need to be when it comes to the tale-tale signs of needing to replace a furnace.
To make your decision, you need to weigh three factors: your furnace’s efficiency; the cost of fuel; and your house’s heating load, which is the amount of energy required to maintain a steady 70° temperature indoors.
While fuel costs are always in flux, gas these days is competitively priced, so I don’t think it makes much sense to switch to oil or electricity. And the average life of a well-maintained furnace is 25 years, so yours should have plenty of life left in it.
Your furnace is still pretty efficient, but if you did replace it with a system that’s 97 percent efficient, you’d cut your heating bills by close to 20 percent. Is it worth spending the money? To find out, add up the fuel bills for last winter—your gas utility will have records—and multiply that sum by 20 percent to determine what your savings would be. Now take the cost of buying and installing the new system and divide it by your anticipated savings. The result will be the number of years it will take to recoup your investment. In general, you’re looking for a payback in about seven years. If it’s longer than that, it’s probably not a worthwhile expenditure.
Given the size of your house, I doubt you’ll see a seven-year payback, even if you add 50 percent to last year’s bills to account for what may be an extra-harsh winter. Every dollar that your fuel bills go up shortens the payback time. But if prices fall, that pushes the payback further into the future.
If it were my house, I’d first look for ways to reduce the heating load. Ask your utility company to perform an energy audit, which will probably uncover the need for some relatively inexpensive upgrades, such as new weatherstripping or additional insulation. Also, ask the company that maintains your furnace about ways to improve its performance. For instance, you might be able to replace a standard pilot light with an electronic ignition or seal the joints in your duct work. These minor improvements will help reduce heating costs and make you more comfortable without draining your bank account.