We live in MD, in the DC/Baltimore suburbs although it's pretty rural out here (horse farm across the street, state park south of us). When we built 12 years ago our choices were electric heat pump or oil...there is no gas piped out here. A heat pump heated our townhouse b/f we built and I hated it b/c it took so long to warm up the house and if I wanted a "quick fix" I couldn't stand over the register to warm up quickly! I grew up with natural gas so I am used to HOT air coming out of registers and oil gives me that, as well as the "quick fix" to warm up quickly...and to dry mittens and boots :-) We have a maintenance contract to have them come twice a year...in late summer to service the furnace and late winter to service the A/C. We also have automatic oil delivery and, as far as I know, we still have a "budget plan" with fixed payments throughout the year. Although, since oil has risen so much lately, we actually voluntarily raised our monthly payment so we wouldn't owe a lot at the end of the season. We haven't had an oil delivery lately so I don't know how much it is now...but I'm sure it's quite high...they're forecasting a big jump in home heating oil prices this winter. We're actually considering getting a pellet stove to supplement the heat so we don't use so much oil...but I haven't looked into it too deeply yet to see if it's actually worth it. Besides, the kitchen remodel comes first! When the oil is delivered, the tanker connects to a pipe on the outside of our house that feeds into the 250 gallon tank in our basement. HTH!

Hi Mike, thank you for your reply. The furnace is original from builder. It is the reason we have to upgrade. The heat exchanger has a crack such that when it first starts we get oil smell. The AC is working fine. The fan motor/blower was changed 3-4 years ago. Most of the installers said that just fixing the heat exchanger is not worth it and is better to go with an upgrade. Maybe they are upselling? We have independent electric hot water boiler at present. One installer gave us Manual J calculation of 72769BTU, but I am not clear if that is heating or cooling or both. I assumed that is heating. Am I supposed to check for cooling too? If I go with that as reference for heating, 20KW heat strip generate 62800BTU 24KW heat strip generate 75300BTU So I thought we would go with 24KW because we don't like to be cold. Additionally, the 24KW heat strip is staged for 8,16,24. So it would only use what was needed. Don't know what cooling we will need because we got quotes from 3 ton to 5 ton, and current is 5 ton. How can we find out that ton we need for cooling? I had done some research and one calculator showed: 1. For Oil at $4.00 per gallon $36.09 per Million BTU. 2. For Electric furnace/backup heat at $0.1139 per KWH $34.06 per Million BTU. 3. For Heat Pump with HSPF 13 (Bryant Extreme) at $0.1139 per KWH $8.76 per Million BTU. So from that the electric backup heat is slightly cheaper cost wise too, but it would also not have all the problems of oil delivery, maintenance, spill issues, having to shovel the path to the oil pipe for the delivery guy (because that is on the far side of the house), etc. Plus oil prices seems to go higher faster, while our utility (small one) sets the price once a year and is one of the lower rates one. Thank you again for your help.

@ Saltidawg: I do see your point... I suppose yearly maintenance is not that big of a deal, and it would be a good idea to have a yearly tune-up/inspection with any type of system anyway. Perhaps "maintenance" is not the right term for all my concerns... it's also the "inconvenience" factor, having to rely on deliveries and worrying about the tank running dry. I know that can be avoided by coordination with your oil delivery service, but I don't like getting on automatic fill-up plans when fill-ups cost so much. (If just using oil as back-up, it would be less of a concern though.) I'm also thinking about long-term costs, such as if the furnace ever had to be replaced (I'm guessing that would be 4-5K?), or if the oil tank had to be replaced (I'm guessing that would be about 2K?). My furnace should be ok for a while, but the tank is 60 years old, so I feel like I could have problems with it. If I consider keeping oil, I suppose I should have the tank inspected. It also has a broken gauge so that should be fixed too. (If I just got rid of the oil, I could avoid that.) It's about about $3,000 more to go with HP with electric back-up than HP with oil back-up. The additional cost isn't just for the electrical upgrade... it also includes going 15 SEER vs. 13 SEER, additional equipment and labor, and removal of oil tank. I would have a higher SEER, sufficient electrical power if it's ever needed for anything else in the house, the tank out of my house, never having to worry about it leaking... also approx. ~20%-ish saving over oil back-up heat if oil stays at $4/gal, potentially more if oil prices go higher. $3,000 isn't a trivial amount, but I feel like once that conversion is done, all you ever have to worry about is one system, the heat pump... no oil furnaces, no oil tanks... so over time, I feel like money would be saved. (Correct me if I'm wrong... an HP with oil back-up should have about the same lifespan as HP with electric back-up, shouldn't it? There's additional electrical components to worry about, but I feel like it's usually the compressor that craps out over time, and compressor usage would be about the same either way, wouldn't it?) That being said, you do have some good points, and I will take them into consideration. If my oil tank is ok, maybe it isn't worth the extra 3K at this time to get rid of oil. If it's not, well then I'd rather take the 2K that would have to go to replacing the oil tank, and put that towards getting rid of oil. @ david_cary and weedmeister: Thanks for the info. I'm still a little confused about actual percent savings, but I think if I'm going to go through with this, it would be ideal to go with a 15 SEER, which I may not be able to do that if I keep the oil. Since my current A/C unit is 10 SEER, I think I would save a decent amount on A/C bills with 15 SEER. (I wish I knew how much of my electric bill actually goes to A/C and what goes to other stuff, but I don't really have a way to tell that.) @ cindywhitall: HP with oil back-up would not have electric back-up strips. If the oil craps out, then it would come down to repairing/replacing the oil furnace, adding electric back-up later, or adding some other back-up later. If I wanted to keep oil AND add electric back-up also, it would cost more than the current higher cost route, and I'm not sure it would even be possible. Oil prices to me seem a lot more unstable than electricity, but that's anybody's guess. Yes, I know I need to make a decision soon, before it gets cold. I know I can easily get through until mid-to-end October without heat, but not beyond that. My electric bill doesn't have the costs on one line either... I added up all the "per kwh" usage charges, and that's where I got the $0.114. My August bill was for acutal usage of 1903 kwh. Does your bill have gas on it too? (BGE puts electric and gas both on the same bill, but since I don't have gas, my bill only includes electric.) I don't know how NJ's rates are, but MD (BGE) did have a pretty big price increase around 2007/2008... however, since then electric rates have come down every year. I use an alternate supplier for additional savings. Rates are only guaranteed until May 2013, and they'll be announcing future rates this fall. My winter rates with the alternate supplier are the same as summer rates. FYI - I am female. My husband doesn't think it's necessary to do an HVAC upgrade, so that's why I'm looking into it. He thinks we should either use only wood and spaceheaters (which we did last year and was AWFUL), or get some oil, but try to make one fill-up (~250 gal, $1000) last all winter, which is unrealistic. Besides the oil issue, we have some other HVAC issues that really should be addressed (we should have some additional ductwork, the A/C doesn't work well on the 2nd floor, etc.), so I think it's really necessary to do something NOW. @mike_home: As mentioned, the tank is one of my concerns, being 60 years old. I wouldn't buy (another) house with all oil either, and if I could go back in time, probably wouldn't have bought this one. BUT - I can't change that now, so here I am :) SO WHERE I AM RIGHT NOW: I know oil alone for heating is not a good option, and something really should be done. I still need to get some more estimates, and I'm honestly not sure yet about keeping the oil as back-up or not. I don't see a big advantage to keeping oil, except less up front cost, and the off chance that oil prices could go lower one day (which I don't ever see happening). I could keep the oil as back-up now and look into other back-up sources later. I don't think we'd really need MUCH oil for back-up... I'm not looking for a toasty 75 degrees... more like 65 degrees most of the time is good enough. We also have the wood stove too. The only drawbacks to keeping oil are that we may only be limited to 13 SEER, and I'm worried about the condition of the oil tank... also it's a good time to remove the 60 year old tank NOW while it's empty... so it's a tough call. No one has commented on geothermal, but I may look into that too... doesn't hurt to get an estimate, right?

Thanks everyone. When we bought the home, we didn't realize the fuel gauge was broken. We were told at closing that there were 100 gals remaining in the tank, and neither our lawyer nor our agent was concerned about it, so I just assumed that they had some way of measuring it and that it was common practice to have the buyers pay for whatever was left in the tank. We took possession of the house in August, so I stupidly didn't even think about oil until the weather got colder and the heat kicked on in late October. We researched local oil companies and the owner of the one we decided to go with came to the house to look at our system and determine whether any maintenance was needed, etc. He said it all looked fine, but pointed out that our gauge wasn't working and asked when we had last had the tank filled. When I told him that the sellers had left 100 gals or so, he reminded me that our hot water heater uses oil and that we were probably about to run dry if it had been running all summer. DOH! I had completely forgotten that the water heater was on oil, not electric. So anyway, our first fill was 240 gallons, which I was expecting. I assumed the tank was full at that point. The tank is in the basement and there are no leaks, so it's not that. It was the next fill that surprised me, because I really didn't expect that we would be burning 60 gals a week when the weather was fairly mild. We did get a ticket with each fill - I'm just looking at them again now, and there is a printed certified meter reading showing the quantity - it all looks quite official. I just can't understand how we used so much in November and so little over the past two weeks, when I know how much colder and windier it has been. The only thing I can think of is that perhaps they didn't actually FILL the tank this last time, and we used much more than 30 gals per week and just don't know it (although it seems silly for them to come all the way out here and NOT fill the tank completely). We'll get the fuel gauge fixed and keep an eye on it, I guess. I don't know that we have any other options at this point! We are definitely planning to convert to natural gas when the boiler needs to be replaced.