Heating & Energy

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Home energy costs

Keeping warm in winter isn't cheap. Around one-third of the energy supplied to our homes is used for space heating. So it makes sense to reduce your heating bill if you can.

We've calculated the rates charged for different ways of heating your home – some forms of heating are clearly much cheaper than others.

Fuel prices compared

We’ve calculated the rates charged for different ways of heating your home.

Our data show costs for 1kWh of heating. These costs do not include fixed charges for natural gas, electricity and LPG (see below) but they do include GST.

Firewood is pine and its costs are from our November 2013 survey of firewood prices. Electricity and natural gas prices are from Powerswitch. Other costs are from pricing data collected during February 2014.

All costs are shown as ranges because they reflect prices in different areas and from different suppliers.

Fixed charges

Our graph is based on the kilowatt-hour (kWh) rates paid for the energy used. But you’ll usually also have to pay fixed charges.

Electricity
Almost all Kiwi households pay a daily charge for being connected to the electricity grid, regardless of how much they use or what it’s used for. The “average” charge is $1.39 a day: it ranges from less than 80 cents to as high as $2.73. The size of this charge can depend on the kWh rate for the electricity you use – a high daily charge often means a lower kWh rate. Visit powerswitch.org.nz to find the best balance for your home.

Natural gas
The “average” fixed daily charge for natural gas is $1.46: it ranges from $1 to $1.88. If you’re connected to natural gas it makes sense to make the most of it – use it for space heating, water heating and cooking – so you can reduce your electricity consumption.

LPG
There’s an annual rental fee of around $117 for two 45kg cylinders of LPG (you’ll need the second cylinder as a back-up). This works out at 32 cents a day.

Energy sources

Heat pumps are the cheapest form of heating and unflued gas heaters are the most expensive. Natural gas is the cheapest form of central heating.

Natural gas

It’s cheaper to run your flued heater or central heating on natural gas rather than on LPG. Unfortunately, reticulated (piped) natural gas is available only in the North Island.

Prices for natural gas typically don't fluctuate as they do for petrol and diesel. It's not easy to export natural gas, so world prices don't have much influence on local pricing.

Tip: Dual-fuel discounts for getting your gas and electricity from the same provider usually mean it’s cheaper than using a separate provider for your gas. Visit Powerswitch to find the best deal.

How clean?
Natural gas is clean-burning for pollutants, but it's a fossil fuel. Burning it adds the greenhouse gas carbon dioxide to the environment.

More information

Electricity

A heat pump is the cheapest heating option to run. You can have a heat pump retro-fitted – but to run efficiently it must be the right capacity for the house and it must be installed correctly.

Discounted night rates make nightstore and underfloor heating comparatively cheap, although you may need an additional meter (which would be an extra cost).

Plug-in heaters are the most expensive form of electrical heating. Modern well-insulated homes suit convection or oil-column heaters because the warm air won’t leak away. For poorly insulated older houses with high ceilings, radiant heaters are likely to be effective – you can feel their heat more directly. However, they shouldn’t be used in bedrooms or in rooms where there are young children.

How clean?
Our electricity comes from a combination of renewable (wind, hydro and geothermal) and non-renewable (gas and coal) sources – so it's only a semi-clean fuel. But in your home, nothing is cleaner. Despite the inexorable rise in the price of electricity, electric heating provides a clean and easy way to heat your home.

More information

Firewood

A woodburner is a cheap way of heating your home – if you can get free firewood. We’ve used prices for pine in our Fuel prices compared table because it was the cheapest and most widely available wood in our November 2013 firewood survey. Delivery is usually free but this depends on how far away you are from the supplier.

We haven’t calculated the cost of burning wood in an open fireplace. Fireplaces are inefficient (heat is lost up the chimney) and they cause massive pollution for the heat they do produce.

Tip: Buy early – during spring or early summer – and phone around for prices. We found some good deals in our firewood survey.

How clean?
Along with wind and hydro, wood is one of the few sustainable carbon-neutral home-heating options. But to get the most heat (and the least pollution), it must be burned hot and in a specially designed firebox. The firewood must also be dry and the pieces not too big (less than 11cm in diameter).

Some woodburners can be used to heat wetbacks but this reduces their efficiency and may also overheat the water.

More information

Wood pellets

These are used in pellet burners and also in boilers for central heating. They’re sold in 15kg or 20kg bags. Our price survey found big variations – and prices were usually lower in the South Island.

Pellet burners cost more to run than woodburners but they have their advantages. They produce less atmospheric pollution and the pellets are carbon neutral because they’re made from waste wood (compressed sawdust and wood shavings).

A pellet burner is one of the cheaper forms of central heating. It’s also the only type of central-heating fuel that’s a renewable resource.

More information

LPG

Prices for the 45kg cylinders of LPG delivered to your door include the cost of delivery – which means people in rural areas pay more. LPG prices have been affected by world prices in the past, but we now have a surplus of LPG in New Zealand, and prices have been quite stable for the past 5 years.

Running an unflued heater on 9kg bottles is the most expensive way to heat your home. It also presents a health and safety hazard: unflued heaters produce CO2 (carbon dioxide) and create condensation.

Warning: If a fault develops in an unflued heater, it can emit poisonous carbon monoxide. This can build up in a room and become a significant health risk for children, pregnant women and people with asthma or heart disease – and high levels of it can kill anyone. An unflued heater should only be used in rooms with good ventilation and should never be used in bedrooms.

How clean?
Like natural gas, LPG is clean-burning but adds carbon dioxide to the environment.

Diesel

Diesel boilers are often used for central heating: they heat water which then circulates through water-filled radiators or underfloor heating ducts. Stand-alone diesel heaters are also available – they’re designed to look like a wood fire.

Diesel prices can change rapidly depending on the world price. In February 2014 the price of diesel was nearly 2 percent lower than its February 2013 price. But during those 12 months there was a 10 percent difference between the highest and lowest prices – and these occurred within 3 months of each other.

How clean?
Diesel is an atmospheric pollutant and a non-renewable resource.

The sun

It's free, and the most environmentally-friendly home heating option available. You'll need large north-facing windows to allow the sun to shine in during the day, a large thermal mass such as a concrete floor to store the heat, and insulation so the heat isn't lost too quickly at night. And you'll probably still need other heat sources for the coldest days.

If you're designing a new home, incorporating some passive solar heating into the design may not cost very much at all. It may also be possible to include some solar features when you're renovating, but it's harder.

More information

Heating a room

There are several options to heat a single room using electricity or gas.

Electric heating
The simplest option is often electric heating. This is the best choice if you only need to heat a single person, say if you find yourself getting a bit chilly sitting at the computer, or watching telly. There are 2 suitable types. A radiant heater has an element that gets red hot and will "shine" heat onto you, or a small fan heater will blow warm air at you.

For more widespread heating, we recommend oil column heaters, particularly for children's bedrooms, as they're silent and the surface temperature of the heater is not dangerously hot.

You could also consider other convection heaters such as a panel heater, or fan heaters. A fan heater, although noisy, does have the advantage of moving warm air around the room to keep the temperature even.

For more information, see our guide to choosing an electric heater. To work out what size (capacity) electric heater you will need for a certain size room, see our interactive calculator - What size heater do you need?

A more energy-efficient option is a heat pump. These can be small enough to heat just 1 room or large enough to heat a big open plan area. They are moderately expensive to buy and install but have low running costs. You can use the thermostat to set the temperature exactly where you want it. And in summer they can be used for cooling.

Gas heating
Gas options include flued or unflued natural gas or LPG models. We don't recommend unflued gas heaters, as they release water vapour and potentially-harmful exhaust gases into your home.

We prefer gas heaters to be fixed to the wall, and we recommend you use the type that has the flame totally enclosed. That way the heater can't tip over and there is no naked flame to create a fire hazard.

Whole-house heating

When heating the entire house, remember not all parts have to be the same temperature.

Bedrooms, kitchens and bathrooms can be kept at a lower temperature than living areas such as lounges and studies. Ideally, any home heating system should be set up with at least 2 individually-adjustable temperature zones.

There are two broad approaches to heating a home: heat the air in the home, or heat the contents of the home (including the people). Generally, heating the home and its contents will give less condensation and a less stuffy feel than heating the air alone. The most effective way to heat the contents of a home is to warm the floor. The next most effective way is to warm the ceiling.

Underfloor heating

Underfloor heating is most easily achieved when a home is being built, but retro-fitting can be done in some cases. The most flexible method is to bury hot water pipes in an insulated concrete foundation slab. The water can be heated using gas, a diesel boiler, solar panels or a heat pump. See our Hydronic heating article for more information.

A popular variation is under-tile heating. Here, electric cables are laid between the existing floor and ceramic tiles. This method is useful anywhere tile floors are laid, including existing homes. To keep running costs down, a thermostat with an additional sensor buried in the tile floor is desirable.

Underfloor heating has one potential disadvantage. If a fault develops with the water piping or electric cable, it's a major problem to fix. Use the best components available.

Ducted central heating
Another option for the whole house is ducted central heating. A gas or diesel central heating unit, or a heat pump, is mounted under the floor, in the attic space or outside the house, and warm air is ducted to the various rooms. These systems can be set up with multi-zone controllers that allow some rooms to be kept at a higher temperature than others, and different temperatures at different times of the day. An advantage of ducted systems is the heating unit is not in the living space – only the duct grilles are visible in the rooms.

Woodburners and pellet burners
Modern, high-output woodburners and pellet burners can heat an open-plan house well. While they're generally less suitable for older style homes with separate, smaller rooms, there are a couple of ways you can set them up to heat a whole house. One is to buy a wet-back heat exchanger for the fire. This can be connected to water-filled radiators in other parts of the house. While effective, it is expensive.

Much cheaper is a ducted heat transfer system that pumps hot air from the room where the woodburner or pellet burner is, to cooler parts of the house.

Use a heating engineer
We strongly recommend you use an experienced heating engineer if you're thinking of getting a heating system for your whole house. Ask how long they have been in business, and if they will provide a certificate of compliance for any electrical work.

Make sure you have a clear description on the size and complexity of the job – you may require a consent from your local authority. That way you are likely to get a system that performs well, and you will have some comeback if things go wrong.

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