Fuel Switching Comes Out of the Closet

There is a special group of conservation measures called "fuel switching." In most cases, these measures involve removing an electric appliance and replacing it with a natural gas counterpart. For years, the topic of fuel switching has been nearly taboo, however, because electric utilities have been less than eager to inform their customers that a cheaper alternative to their service might be available. In fact, many utility auditors used to be instructed not to recommend fuel switching measures to their customers. Likewise, state regulatory commissions have rarely pressed the issue.

An article in this issue of Home Energy illustrates the political sensitivity of fuel switching (see "Evaluating Low-income Water Heater Fuel Switching," ). The article was inspired by a report on the potential for electricity conservation in Michigan. The original report included a section on fuel switching, but that part was deleted by a committee made up of, among other parties, the electric utilities of Michigan.

The article also documents the potential savings and cost-effectiveness of fuel switching. Water heating is the most obvious candidate for fuel switching because it requires so much energy, and the savings resulting from switching are reliable. The advantages are clear for houses with gas furnaces and electric water heaters because a gas line can be easily extended to supply the new gas water heater. It would be difficult to find other conservation measures that can chop 400 kWh/month off the electric bill. The savings are so large that customers notice the drop.

After the water heater, the electric clothes dryer is the next likely target for fuel switching. The savings will probably be less, and the payback time for the investment longer, but it can still be an important retrofit. Other fuel switching opportunities can be found in the home, including electric stoves and spas, but the savings depend on the situation.

Recently some utilities, regulatory commissions, and even the Department of Energy have revised their policies on fuel switching. In some cases, they actually encourage it. Fuel switching has finally emerged from the closet. Perhaps now a more balanced (and less visceral) attitude towards fuel switching can evolve.

This is important because there are significant reasons for opposing fuel switching, ranging from the safety of gas appliances in certain situations to the cost-effectiveness of making a change. Extensive use of new, energy-efficient appliances would offset some of the potential gains of fuel switching. For example, a house with a low-flow showerhead, a dishwasher with a booster heater, and a water-efficient clothes washer could reduce hot water use so much that switching would not be justified.

In addition, the next generation of heat pump water heaters may perform more economically than gas water heaters in mild climates. The number of occupants in a home (and their habits) are another variable.

Fuel switching measures should be in the conservationist's toolbox, but they need to be applied with attention to both present and future situations.

Alan Meier