Is gas cheaper than electricity for heating?

Is gas cheaper than electricity for heating?

Heating and cooling accounts for far more energy usage than anything else in the home - anywhere between 23% and 50% of a household’s total energy consumption - so it makes financial sense to choose the least expensive heating option. Working out whether gas or electricity is the cheaper heating option ultimately comes down to three factors - the base cost of the two fuels, cost of the appliance itself, and the efficiency and running costs of the heating systems.

Base costs

Gas is generally considerably cheaper than electricity, largely because it does not need to be burned to produce energy before being distributed. We are also fortunate in Australia to have an abundant supply of gas, with fantastic rates available across the country . If your property doesn’t already have a gas supply, you will have to pay to get connected so that is an additional cost you will need to take into consideration.

Appliance costs

The initial cost of purchasing a gas heater tends to be higher than that of electric heaters. However, as detailed below, they cost less to run for the same heat output as electric heaters.

Running costs

The cost of running a heating appliance over the course of its lifetime is of course partly down to how much the fuel costs you to begin with - and gas wins on that score in most areas. However, running costs are also attributable to the efficiency of the appliance. The huge advantage that gas has over electricity here is that most gas heaters are star rated, whereas electric models are not. How does this help? When you come to choose a heater or heating system, you are able to see at a glance how efficient a particular model is. The higher the star rating, the more efficient - and therefore more cost-effective - the heater is to run. 

The fact is that electric heaters aren’t the most efficient way to heat a room. For the amount of heat they deliver, gas heaters are far more efficient so they tend to be the best solution for heating large spaces. Cheaper portable electric heaters are fine for heating a small room such as an office or if you are only going to occasionally use them but use them frequently, for long periods of time, or to heat open-plan spaces or large living areas and your wallet will feel the pinch.

However, even natural gas portable heaters can save you up to 40% in running costs compared to similar electric heaters. Reverse-cycle air conditioners are cheaper to run than other electric heating systems and more efficient when heating large spaces but don’t be tempted to opt for a cheaper unit as they will be less efficient and therefore more expensive to run.

In conclusion...

Gas heaters may cost more that electric heaters initially but are more efficient to run, meaning lower energy bills, and usually have reduced maintenance costs over the course of their lifetimes. As long as you purchase an efficient gas heater - whether portable or ducted - gas is currently a more efficient fuel then electricity to heat your home. 

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