We have natural gas in our primary home and propane in our second home. I would take natural gas any day! It costs us $1900 to heat our primary home in 2010. It's about 3000 sq ft on top 2 floors. It cost us $2800 to heat our second home in 2010, and it's about 1600 sq ft. We've had such a nightmare with the propane providers in the area and have gone through several budget plans, etc and finally opted for the pay as you need it. So, now they come only when it gets very low. But, we are still hesitant to ever run the fireplace or anything else because it's so much more expensive than natural gas.

Is the gas company giving you any credits for your gas appliances? They should.

1.03 gal of propane equals one therm, therefore propane costs 3 times as much.

My husband worked for So Cal Gas for 43 years and did the calcs that I gave above.

Hope this helps.

Another consideration is the natural gas rider on the transmission of gas. In our area it is $25 dollars every month just to have the gas line. For the amount of gas you will be using that would be a dollar or two per ccf of natural gas. I am electing to use propane because I will only have the gas cooktop and it would 3 or 4 dollars per ccf

The rider is 10 bucks a month. Any idea on what average gas use would be for on demand hot water?

It looks like even with propane being 3 times as much it would be a long payoff for the NG.

So you are just using hotwater and cooking? Then propane is the way to go (although honestly solar hot water is really the way to go).

Hot water depends how much you use it, do you take baths, do you have multiple shower heads and take long showers, do you have modern laundry or do you often wash with just cold water?

You could use $5 of NG a month for on demand water or $20; That would be either $15 propane or $60. We cook a decent amount and have NG bills of $1-$2 a month.

Do you have no need for heat? What part of the country do you live in because heating ground water in Florida is different that NY and takes significantly more energy.

Also - propane is roughly equivalent to $.10 a kwh for using just electric (although cooking is not as much fun and instant hot water has issues). Propane is derived from either oil or NG processing so it does vary some with oil prices. NG is a domestic product and I would bet the farm than NG will continue to become even cheaper than oil on a btu basis over the next 20 years.

If you use a decent amount of hot water and live in an area with state credits, solar can pay off very fast. It usually is less than 10 years but can range from 3 to 20; So it may make sense in your situation or it may not. For me it was $6k with $4.5k in incentives (utility;state;fed) so it basically cost what an instant hot water system would cost (maybe a few hundred more) so payback was almost instantaneous. If you made that decision, then you really wouldn't have a NG/propane decision - your only decision would be is cooking on gas really worth that tank? (but it probably is).

You should also consider convenience, aesthetics, and the cost of appliances (including future replacements). If you go with propane, remember that it has to be delivered (you could run out) and stored. Propane tanks are unsightly if not hidden. Propane appliances are generally more expensive than NG appliances, and you'll have less selection. If you sell, I think most buyers would prefer NG over propane.

Unless the appliance was actually designed for propane )and does not need a conversion kit) the NG to propane conversion kit reduces the output of burners.

david_cary - Yes only cooking and hot water. I live in North Florida so will just be using a heat pump for heat. I have thought about a hybrid heat sys but for the few weeks that it is cold here dont know if that would be worth it.

Dont think we use a great deal of hot water but we do like a nice long shower sometimes. Have one toddler with a another on the way so hot water use will definitely increase through the years. Not sure if solar would work, sides of roof will be facing east and west.

Payback might be greatly reduced if oil continues to rise like it is!

Solar hot water does not need a south roof. Its heat production is reduced a bit for east or west but it is not a deal breaker (especially in Florida)

When I was deciding, they specifically told me to put the hot water on an east roof if we planned on PV. Decided against PV so I do have it on a south roof.

In FL, a hot water heat pump is very cost effective (especially compared to propane). It would probably cost the same upfront as a propane instant hot water but would cost about 1/3 to run (assuming your electric is cheap). Then it cools the house as a side effect, reducing your a/c load. In a/c season, it comes close to running for free by the offset in a/c load.

Solar hot water is cost effective (on our southwest facing garage roof) in Michigan, so definitely check this out for Florida.

Can you get an induction range/cooktop instead of gas? Check out the kitchen and appliance forums--almost all of us LOVE induction, even if we were intending to get gas originally.

Doing both of these could solve your problem.

Anne