Definitely divide dollars by KWH or therms. That is your total price. Gas rates float more than electricity.

What else do you use electricity and gas for? Outside of HVAC, the biggest cost is probably water heating. Gas or electric?

You should subtract the gas and electric service charges before dividing. It makes a difference if your usage is small. I suspect this is the reason your rates seem high.

The web site you listed is pretty useless to calcualte heating and cooling costs. You need to use the actual usage data for your house.

I tracked my gas consumption for several years (S. Jersey Gas)which included all charges.

It ranged from over a dollar to (once) slightly over 2. Averaged about $1.40.

V

The fixed charges will not be reduced by energy saving steps you take.

Use the kW-hour or per therm rate.

Those are what you are paying for the 'last unit' of energy you use.

Upon reflection, it turns out no one has really given you the right answer of how to calculate your cost per unit of energy. You divide dollars by therms or kW. What is included in $ is the costs that vary with the amount of energy that you use. The costs on your bill that don't change each month, leave out. You can usually get a bill explanation at your utility web site, to get variable costs or just compare two bills maybe from high and low months.

Brickeye is correct. This concept is called marginal cost, and it's how you consider the effect of a change when the unit cost is variable. As is typically the case for utility prices, the more you use, the higher the per unit charge. Average cost isn't useful to look at when the tier prices differ significantly and the fixed costs should be left out because they're the same in absolute amount whether you triple your usage or reduce it by 90%.

The per unit tiered pricing is clearly shown on the utility bills I get for electricity, gas, and water.

Cindy, it seems that the more information you get, the more confused and frustrated you get. Replace what isn't working, spend what you can afford, and call it a day. You've demonstrated the concept of "paralysis by analysis" as well as anyone I've seen.

If you are trying to determine how much energy costs have decreased then you should track the KWH and therm usage. Rates fluctuate every month making it difficult to determine how much you are actually saving.

For a 12 month period I spent a total of 3805 on gas and electric. My gas is for the dryer, hot water and heat. Everything else was electric. (Too many tv's!)

When they claim I will reduce my energy costs by 25% I assume they mean my heating and cooling costs (OR maybe not, see below which I copied from njcleanenergy.com). I know this is a stretch for most of us to believe. I was trying to figure out how much of the 3800 spent was towards heating and cooling.... highs for gas, 230, 319, 221 and highs for a/c 302, 350 and I put down 400 because that was this month...but I think the 350 was the same month last year so I may have dropped out one in the 200's.

snidely, I am going to replace what actually IS working, that is why my extensive research and dithering back and forth. I want to replace it BEFORE it goes due to the assumption that it will go within a year or so and IF THIS REBATE program is ACTAULLY a good deal I want to do it while the program is in place. If the program is NOT such a "deal" then there is less of a rush. I do like the idea of the energy "savings" I hope to achieve so I may as well start "saving" (or spending!) sooner than later. I am also looking forward to the increased comfort that so many say I will realize with a 2-stage variable speed heater, and whatever benefits an Infinity (maybe) might provide.

The idea of those benefits leads to my current quandry of whether I pay extra for Infinity, or let my wallet decide on the Amana. For the right price Infinity wins! (I do enjoy new toys.)

Please read the following explanation of total energy savings. I read it as 25% of my total, but don't see how that's possible unless I turn off the lights and don't use electronics. It sure would be amazing if it were true!

"How are total energy savings (TES) calculated?

The savings is based on software calculations of the amount of energy that will be saved for the upgrades being proposed (as a percentage of the total electric) and any fossil fuel energy you use over a 12 month period.

For example, if your house has electricity and natural gas for heat and water heating, your utility billing information is entered into the program software and is converted to BTUs of energy; the total is your annual household energy consumption. Your contractor then proposes energy savings upgrades, for which the software calculates the natural gas and electricity energy savings as a percentage of your annual consumption. This savings percentage is included on the printed Proposed Measures report from your contractor. If the percentage of savings achieved is 25% or higher, the project qualifies for $4,000 cash back and a 0% interest loan.

What measures impact TES?

All eligible measures that save energy, such as air sealing, insulation, and improved heating, cooling, and water heating may be included in a package of upgrades to achieve the 25% total energy savings. "

Cindy - here's a short cut analysis

Replacing what works = doesn't sound very smart

Assume you save $1000/year - if you spend $10,000, you've spent more than you saved until 10 years from now, not considering time value of money, which will actually push out the payback because the cost is now and the payback is later. Not staying in the house long enough to see payback? You're wasting your money, it's a net cost not benefit to you.

You want the higher efficiency and perhaps comfort and you can afford to spend the money? Then the economics don't matter.

How's that?

The software will determine whether you get the rebate or not and is based on the its calculations and what inputs are allowed for the structure. We don't know how flexible the inputs are. In my experience, the software is pretty generic and don't allow for things like the difference in the lifestyle of the people occupying the structure. For example, are the occupants home all day or out at work or play for 12-14 hours every day? Do they buy their meals or cook their meals? Do they line dry their laundry or use a dryer? All of those things could make a big difference in how you run things in your home, but can not be taken into consideration in their product. Whether NJ software fits you and your home well is a question that I can not answer.

IIRC, my state's energy efficiency program counted total energy when I was looking at it a few years ago. That means that replacing incandescent lamps compact fluorescent lamps counted, even in the attic if the bulb got burned for 10 minutes/year. The software can't account for different bulb locations.

About the best you can do is get a list of the potential improvements and see what combinations allow you to grab the rebate. Choose from the menu items that make the most sense for you and still allow you to grab the brass ring. It might not be easy. If you line dry your laundry, an efficient dryer might get you a rebate, but it won't do squat for your energy bills. If cook a lot in a predominantly cooling climate, an induction range with a well-insulated over and a good kitchen ventilation plan will save you money, but it is not likely to get you closer to a rebate.

Snidely, the cost is not now because it's financed at 0 percent for a 10 year period, so I thiink I'm ahead in the time value as i get the product now but my money can stay invested. Also, I would stay in my house forever, not sure what hubby's plans are or what my kids will do. The financing might not be available next year when the system starts to go. Plenty of neighbors have already needed replacement and our homes were all built within a 2 year period. It's old enough that I will replace and not repair. Clearly, by the time I move, whether it's 5 years or 10 , the person who buys my home will balk at the 20 + year old system. I know I would and that's how it is where we live. Why replace it for a buyer (if it were to last that long) when I can enjoy it now and not have to deal with no heat or air when it does fail? At that point i wont have the luxury of getting multiple estimates etc., because my family and i will want it fixed asap. We figure it's an expense that is coming in the near future, so if we can get a "deal" now we want to take it. I have been trying to decide how good of a deal it really is.

There's little difference between 0% and 4%, but let's continue that along with the same numbers.

If you repay the loan over 10 years, your savings repays the loan. So you've saved nothing, and also paid nothing. But you've had the new equipment. Which is what I said, if you want the new equipment and can afford it (however you look at it), get it and forget the cost.

People don't tend to balk at buying a house because of an old HVAC system, because they know it can be easily replaced. Similarly, few will jumps at a house with a new system, for the same reason. When houses costs hundreds of thousands of dollars, more in some places than others, $5-$15K one way or the other doesn't tilt the balance

"When houses costs hundreds of thousands of dollars, more in some places than others, $5-$15K one way or the other doesn't tilt the balance."

Are you saying that if someone is considering buying a house, the fact that the furance and AC needs to be replaced does not factor into the decision? You should visit the Buying and Selling forum. There are posts about buyers walking away from a home purchase for much less costly repairs. It is still a buyers market. You have to hope the inspector finds no faults with the HVAC system.

"There's little difference between 0% and 4%"

For a $10,000 10 year loan at 4% the differnce is $2,150 over the life of the loan.

*Are you saying that if someone is considering buying a house, the fact that the furance and AC needs to be replaced does not factor into the decision?*

Yes. My experience (and yours can be different) - Buyers consider a gazillion factors in deciding which property is suitable. Things that are as they are or need big bucks - size, room layout, location, kitchen and bathrooms, yard features, other amenities, a specific feature the buyer might be looking for - weigh heavily. Things that can be easily changed, or changed at reasonable cost - colors, old stove, window coverings, hvac, less so. Nothing better than to have an inspector highlight a roof, termite or hvac problem, then the buyer can negotiate the cost with the seller. Although, I think many inspectors aren't qualified to do much more than turn the system on and listen for funny noises. If air comes out on the supply side, it's working fine as far as they're concerned.

Buying a house is not strictly a rational decision, it's an emotional one too. "We fell in love with....", or "I walked in the door and just knew...." are examples of what people will say. The state of the hvac system doesn't do anything in this regard. Most people don't walk in with their laptop and a spreadsheet for calculations. More typical is people decide what they want to do with their hearts, and then rationalize or stretch the finances to make it happen

*For a $10,000 10 year loan at 4% the differnce is $2,150 over the life of the loan.*

That's $18 a month, a minor amount. If you can afford your house payment, an $18 increment makes little difference, don't you think?

I agree an HVAC system in poor condition can be fixed. However buyers will use it to negotiate a lower price. In some towns you can't sell a house with a broken furnace or AC.

An extra $18 a month is not much, but it does add up over the life of the loan.

I would still like to know what happens to this loan if the homeowner moves before the loan is paid off. If the owner sells the house, then it becomes an unsecured loan. The lender has no levarge if the homeowner decides to not pay the remaining balance.

mike_home, that was my point...if I am looking at two homes and one has a newer, efficient system and the other has one on it's last legs...guess which one I am buying. Cost of repair for the buyer aside, it sets a negative tone for negotiations for the seller.

We are in the same process with the roof....Hubby would love a new one because he likes how the newer dimensional shingles look. Ours has some algae, but not as bad as others. It drives him crazy. Our neighborhood has a fair number of new roofs that would say to a buyer that ours is probably going to need replacing. They got "lucky" and had insurance claims for hail. Some of them were bogus due to a door to door sales pitch be a company that later got in legal trouble...regardless, they would be our competition should we ever sell. Theory here is that if a roof lasts 15+ (newer ones last longer I hear) then we may as well do it now so we can enjoy it (looking at it) and not wait until a leak tells us it's time.

In both cases....it is not a matter of IF we should do the replacement, but when... AND snidely is correct that part of the decision is that quite frankly we WANT to do it AND we can afford it. Just don't want to throw it away without getting the best equip at the best price!

Can I ask you guys a new question??

Turns out contractor one, who quoted me a new lower price, is not actually giving me an Infinty heat pump. He is doing Infinity furnace and says it needs Infinity control. Is that even worth doig, the partial Infinity? I don't have the exact model as we've been doing this by email. I don't think he wants to write it down until we have an agreement (so I can't use it to price match etc)I will call him, but haven't done it yet.

He said "the Infinity furnace and control because it is needed with the hybrid system, but not the infinity condenser to keep the price reasonable and qualify for the program"

1. Is the Infinty control really needed with the furnace for hybrid?

2. Do you think he miswrote that and it's the Infinity heat pump and not furnace? His original quote was the 59TP5A and the 25HNB648...I think that is Infin hp and perf furnace. I will ask him that. I think that is the system he took 2000 off recently. Is that a good system?

Is it better to have Infinity on AC only or furnace only? (If you could only afford one?)

He says the config gets only $150 rebate...have to ask how much more to get 1100? Seems like should wash out now...higher priced a/c or furnace and higher rebate. I will be asking him this....next week. I got myself tired out thinking this through again.....trying to decide how much more a "half" infinity system is worth compared to an Amana, comfortnet, both 2 stage...Is ComfortNet like Infinity???

SORRY!!

Infinity is a marketing name for Carrier's variable speed furnaces and 2-stage ACs/heat pumps. If you want a 2-stage AC or heat pump, then you must have a variable speed furnace. Therefore you must have an Infinity furnace if you are getting an Infinity 2-stage AC or heat pump. The Infinity controller is the brains behind controlling the furnace stages whether it is 2-stage, 3-stage, or modulating.

There is nothing wrong with pairing a non-Infinity AC or heat pump with an Infinity furnace. You won't get the humidity control in the summer. You will get the benefit of the mutliple stages in the winter.

I have owned my Infinity furnaces and ACs for three years. In my opinion they have made the house very comfortable in the winter and summer. I am very happy with the performance so far.