Missing from your post is the cost of gas vs electricity and the anticipated amount of energy that you would use. That's the only way to make a calculated conclusion.

But let's say that you use 800 gal of oil a season @70% efficiency. @ $2.35 gal = $1,880

That would be the same as 852 therms of natural gas @92% efficiency. @$1.10 per therm =$937

And 22970kwh of electricity @100% efficiency (electric resistance heat, not heat pump). @$0.12 per kwh = $2,756

Your Mileage May Vary.

We don't know what part of the country you live in, but I'm guessing that a heat pump may not be appropriate for the older part of the house.

because HP usage varies not only by teh particular unit, but by outdoor temps. without knowing a whole lot more info it is impossible to say what you could reasonably expect from one.

my HP replaced a 30 yr old strip heat only furnace and our electric bill dropped over 40%. even when temps have dipped into the teens at night the HP has never turned on teh strip backups during normal operation(except defrost mode). they turned on one time to test and once when my wife turned the stat up too high, but other than that my HP has always been able to maintain temp on it's own. but we usually get highs in teh upper 40's even one the coldest days of the year, and lows rarely get below mid 20's. plus i have a blower insert in my fireplace and that helps warm the front of the house.heck, the FP alone cna heat most of the house if i don't mind it gettign a little warm in the den!

other folks can put in a HP and not see any real big savings, just a few dollars a month. in that case it would take a while to see a good return. mine paid for itself in under a year though, cutting 40% off a 5-600.00 a month electric bill worked out great for us, plus i got an income tax credit for it.

David got it right.

I was guessing at a lot of variables as it was. No way I'm going to predict HP performance. Heat Pumps and very cold areas and/or buildings that aren't tightly constructed and insulated generally aren't a recommended combination. They spend all their time on the electric resistance heat.

The fact that the existing oil was free is immaterial (a bonus for you, but meaningless for weighing the ROI on the gas line).

You need to insert your fuel costs into the information I provided to get a better idea. My gut tells me that the gas line will pay for itself in less than 3 years.

Thanks again.

Yes, the free oil is immaterial....just to hold me off until a decision is made.

It sounds like what I need do is save up for the gas trench/h.e. gas furnace while we use up the oil. Saturday the chimney guy is coming out to give me a quote for an insert and a stand alone wood oven. And finally, when the current heat pump finally goes, replace that also with h.e. heat pump.

Quick question - I got an 'approval' form from the gas utility (Dominions) for hookup, but when I called to find where the gas main is, the lady from new construction said it wasn't there job to tell me that......huh? Not sure how the plumber is suppose to quote the job, unless I call OneCall but that's not free for homeowners (only members like contractors - so I read).

So where do I start?

In my neck of the woods, it's the gas co's responsibility to get the service to the house. There may be a charge for that, but it's the gas company doing the work. I notice that where you live, the hookup from the street is your responsibility.

The gas company should have written policy for who is responsible for what, what inspections must be done, how the connection is made, etc. You can get that or you can ask if they have a list of contractors that they have used before and just let them deal with it (best idea).

I should probably press them a bit more on this. I believe it's the owners responsibility to the main. Just wish I knew where that was.

I've called 2-3 of the top rated plumbers from Angie's List , but they wouldn't even return my call and they are only 10 min from my house! Economy must not be hurting as bad as they say. That's why I was wondering how much more expensive a h.e. HP would be as opposed to trenching.

I'm also going to look in geothermal and maybe get someone out here for a quote. I have the yard space for it and a well in the front yard (for watering the lawn). Maybe the combination of two would meet my heating needs.

Just some anecdote as a point of reference.

I'm in the northeast too. I had a heat pump installed 10+ years ago, primarily for central air. The house was built with the idea of wood as heat source (I'm on wooded ten acres)but the heat pump has been a real asset for the many days where ambient is above 32F. There was a long thread on this forum pertaining to heat pumps that do better at lower temps, but until mine needs replacement I haven't read the fine print.
I'm pleased with HP performance, but I'll add my house is well insulated. So far, minimal maintenance.
Heat pumps are relatively rare north of the Mason-Dixon but certainly worth looking into.

Have you looked into an LP tank vs. running the gas line?

alphonse - how big of a house? Maybe I can go with a good heat pump knowing that I should/will insulate later with some type of blow-in when redoing the siding?

I haven't looked at a LP tank, but aren't these usually situated outside? If so, I bet the HOA would love that =]

Don't even think about LP. Check out some of the posts on LP costs... it makes oil seem cheap by comparison.

hautinglu: look, this is a pretty straightforward situation. You need to insulate, install a 92% or better furnace and a gas line. That all costs money, but payback is assured in about 3 years. You got about $1,800 worth of free oil, consider that a credit towards the gas line. Take advantage of the tax credits where you can.

You might be able to eventually tighten the old part of the house so that it works with a heat pump... but when and at what cost? If you are like me, those insulation projects are spread out over several years.

A geothermal heat pump is a possibility, but it will make the gas line install look like a bargain.

I have read all your respones and I can't believe the gas company will not even mark out the main. If they are that uncooperative I must ask you who taps into the main with the line for your house and who is responsible if somthing goes wrong. Unlike oil, if there is a problem, gas just blows up unlike oil. Who inspects the gas work done to the main line and what is the gas company's job. What do they actually do. I live in MA and nothing can be done with the main or running gas lines without the gas company. We have what they call DIGSAFE. It's an 800 NO. AND IF THEY ARE NOT CALLED THEY WILL SHUT YOU DOWN. Another point that comes to mind is service for this gas unit. Not to knock plumbers but they will all install the unit but try to get one to service it if it fails. Gas units today have a lot of bells and whistles on them, especially the condensate ones and it doesn't sound like your going to much help from your gas company. Typically a plumber will not service them and now you can't rely on your oil Co. It may be down the line but might be worth thinking about.

spot - I called them up once after getting the approval letter, but didn't get anywhere with the lady. Then other stuff came up and I went on vacation. I'm going to take it up again when it gets cold to ready for next spring.

Supposedly, I can use a utility approved plumber to trench and lay the line up to the main (and possibly install the meter at the house), the utility then comes out to do the inspection and the tap into the main line. They really don't want to help the owners and the contractors are too busy with new construction.

I know this isn't helping, but it's pretty outrageous that the gas company isn't responsible for everything up to, and including, the meter. I assumed that the meter was at the street like it is in some rural areas.

I checked their website and your gas company seems like it's trying to make a buck on virtually anything... they even sell outside gas line insurance and landscaping repair for an extra fee. Just don't expect them to provide gas service to your house.

By way of comparison- the Gas co in my area charges $9.12 a foot to do the work and will give you a 100' credit if you install a gas furnace. 50' for just a water heater and 150' for both. They then own and are responsible for the pipe.

As for Spot's point... a modern furnace is a pretty dependable piece of equipment and the days of simple gravity furnaces are long over. If you do have a problem, you don't call the utility company, you call a furnace repair company.

jake - I wish it would be that easy. If they gave me a credit (which I did ask about initially), I go with a gas furnace and tankless. But with all the hassle, why bother. A gas furnace will be enough for heating.

"alphonse - how big of a house? Maybe I can go with a good heat pump knowing that I should/will insulate later with some type of blow-in when redoing the siding?
I haven't looked at a LP tank, but aren't these usually situated outside? If so, I bet the HOA would love that =]"

2500 sq.ft.
I'd venture that insulating/ quality glazing always has paybacks and should be a priority whatever system you go with.

Being in a rural area far from any NG distribution, many people here opt for propane with a typical tank size of 500-1K gals. The tanks are often buried, but not all jurisdictions allow that. Pricing is better at such volume. Fuel oil prices fluctuate so widely that cost comparison isn't cut& dried. LP serves as fuel for DHW, cooking, and for the Amish, refrigeration and lighting.

"I'm also going to look in geothermal and maybe get someone out here for a quote. I have the yard space for it and a well in the front yard (for watering the lawn). Maybe the combination of two would meet my heating needs."

As noted upthread, up front costs for geo are pretty high but given your situation absolutely worth looking into. A savvy contractor would prevent glitches that can occur with water pump/demand issues...factor in that such systems can provide all DHW, "free".

Quick update....

Was riding back from Lowes for the tenth time this week and saw a bunch of trenchers and contractors on a very large property near me. I got to thinking and came back a bit later. Got to talking to the guy trenching (the GC). We probably talked for 30min about trenching lines, septic systems, and geothermal. He seemed like he knew what he was talking about and didn't mind taking time out of his schedule.

Got his card, and he told me to give OneCall a ring. They are suppose to come in within 3 days and mark everything. After they do that, he's going to come out for a quote for the gas line. From there, I'll start thinking about the water and sewer hookup.

Update 2

FWIW: Had the county guys come out after a OneCall. They suspected the gas was towards the backyard, near the other street. This is where the water hook up is. Going to have to wait for Dominion.

p.s. finally decided to turn the oil furnace on. Man does it make a house nice and toasty. It's an old beast, but it works.