Rising costs of home heating oil
In response to our map asking what's hurting you most about the credit crunch, we've received a number emails from listeners on the huge price increases of domestic oil.
Around 1.5 million household use home heating oil in the UK. They generally live in rural areas, off the gas main, leaving them at the mercy of global oil prices.
A year ago domestic oil cost 33p per litre, today it costs 55p per litre. The average oil tank costs £1000 to fill, most people fill up their tank 2-3 times a year, leading to a bill far in excess of their gas-paying counterparts.
Also, there isn't an equivalent Ofgem body to monitor suppliers and help protect consumers.
This chart on the Boilerjuice website, a UK domestic oil supplier, is plotting the rise of home heating oil prices. They say their average order has dropped from 1000 litres to 500 litres in the last few months as people struggle to pay their bills.
So far -
- we've arranged for a reporter to meet one of the listeners who emailed iPM about his situation.
- we've been ringing round energy analysts and consultants to explain why the price has jumped more substantially than petrol/diesel over the same time period.
- we're looking for MPs who're concerned about their constituents and fuel poverty.
Is there someone in particular you'd like to hear from on this? All ideas/comments welcome.
UPDATE: When we first looked at this, there didn't appear to be any alternatives for people not on the main gas network, but to heat their homes with oil.
Then we found out about Chris Leek's not-for-profit company. He runs Community Energy Solutions, who work in areas considered to be in fuel poverty in Yorkshire and the North East. They try to connect people to mains gas or find ways to reduce their bills through renewable energy.
This is an extended interview of the one we broadcast on Saturday's iPM.
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Comments
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Hi Jennifer,
Great article! I just wanted to let you know that there has ALSO been a large number of thefts of heating oil; people actually breaking into people's property and stealing gallons of heating oil!
All the best,
Jim Connolly
<a href="http://www.theideasblog.com">www.theideasblog.com</a>
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An alternative to using heating oil is to use an air conditioning unit as a heater. Although this uses electricity, the electricity is used to move heat around (it is a heat pump) and so the heat gained by the house can be as much as 4 times the heat generated by an electric heater. The result is that you pay 3p per kWh of useful heat instead of 12p per unit for electric heating or 2.5p per kWh for gas.
A 3 or 4kW (output) air conditioning unit costs about £500 but expect to pay twice this with installation. This is suitable for heating the main living area in a house. The only real problem with an air conditioning unit is that it is a much more complex device than an electric heater and will need maintenance, just as a gas boiler (or a car) does.
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PM programme
Having listened to your story on heating and the expert view on bringing affordable heating to domestic homes, we were amazed at how little emphasis you and your expert placed on Heat Source Pumps. If there is electricity available, which must be true for just about the whole of the UK, then HSPs are an extremely viable option.
We have recently had an Air to Air Heat Source pump installed, and in monitoring the consumption of electric units, compared to oil costs we are going to save a huge amount on heating costs, and at the same time be very much warmer. It will not be long before we cover the purchase and installation costs, and at the same time, we have contributed enormously to reducing carbon emissions.
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Spare a thought for us in the Outer Hebrides. Our weather is worse than anywhere in UK, thus we need more heating and insulation. On top of that due to remoteness we have very little "voter power" with any government and nobody listens while heating oil prices are now 63p per litre and diesel is now £1.39 per litre! This is higher than anywhere whilst pay rates are among the lowest with many residents living a simple crofting life with the resultant paltry earnings. A large proportion of Outer Hebrideans are in fuel poverty. Nobody ever talks about it in mainstream media.
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I agree with all that has been said. We have to use oil.
I am in the unfortunate position where the gas main is nearby, but have been quoted £18,000 the bring the main to my boundary.
I need a "baby" tanker to deliver my oil, so can't use the excellent boilerjuice service (I would recommend looking at this site) and have to shop around myself.
I've seriously looked at ground source heat pumps, but it's not practical to retro-fit to an old property.
So..........done all the insulation possible, and am looking at solar and PV panels.
But still the price of oil soars, and certainly doesnt drop at the same rate as the barrel price drops.
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I'd like to know more about causes - not just headlines, but a thorough analysis - and refer to an Early Day Motion tabled by John Hemming MP. It reads:
ENERGY AND FOOD PRICES AND PEAK OIL 29.04.2008 Hemming, John
That this House notes that current movements in energy and food prices
are in conformance with the predictions as to what would happen as oil
production peaks; and calls for the Government urgently to review its
predictions as to when peak oil occurs with a view to determining
whether or not urgent policy adjustments are called for.
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We live in a rural area and our house is heated by oil.
The price of oil used to be driven by supply and demand, so now we have passed 'peak oil' and with China and India coming on board the price is going to rise as the commodity gets scarcer.
But recently, with the dollar weakening and talk of recession, speculators have got in on the act - buying oil as a 'safer' option than dollars.
This is the main reason prices have recently leapt so high and so fast. Hopefully the bubble will burst, or someone will find a way of taking the speculators out of the market. But meanwhile it will affect transport, industry, farming and food supplies...
But we do need to prepare for when the oil runs out - otherwise society will just collapse. Think about it ... we rely so much on oil and its byproducts like plastic. My wife had chemo in hospital recently and every time they threw away the plastic syringes I wondered what we will do when the oil runs out...
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Don't believe Boilerjuice's quotes - whenever I get one it is consistently 2-3p/lt more than the lowest figure I get simply by ringing around my 3 local suppliers (S. Wales).
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Peak Oil: http://www.wolfatthedoor.org.uk:80/
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Thanks Desperate Dan - a great link - especially the 'Futures' section. But will any politician dare to admit the end of economic growth - or that life as we know it has gone for good? Maybe ITV should make a film about it like their recent 'Flood' drama - could be gripping stuff!
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Hi there. Has anybody done a robust calcualtion or test to see if it now cheaper to use an immersion heater for hot water rather than run the oil fired boiler just for hot water ?? I reckon I use 120 litres per month for four adults for hot water only - which I guess equates to £55 per month or £1.80 per day. This would be the same as having the 3kw immersion on for 5 applied hours ....
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We have been heating our hot water with off peak electricity for several months now - just about get through the day provided everyone has their baths etc on off peak first! 4.65p per unit on the last bill
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Ponx08 - Heating oil has a calorific value around 36 MJ/litre or 10 kWh/litre. So if oil is 50p/litre the heat value costs 5p/kWh.
The boiler has an efficiency in the range 70 - 95% (latter figure for best condensing boiler). Taking 80% the heat input to hot water costs 6.25p/kWh. In other words off-peak power is cheaper than burning oil, but oil is cheaper than daytime power.
I bought 1000 litres of oil at 28p in Jan 07 and at 42p in Jan 08, inlfation of 50% p.a.
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Now I've managed to listen to the extended interview I would like to take issue with the speaker's presumption that oil is expensive compared to gas. It might be true now, but.....
At current gas price of 2.6p/kWh (ignoring the standing charge or initial units at higher cost) the breakeven point is oil at about 28p/litre, the price it was a year ago.
Oil has been 10p/litre in my recent memory, and I can store 2250 litres of it, so if someone came offerring "cheap" gas I would not be interested as I do not believe the long term price comparison justifies it. Oil is also a more efficient fuel as it has less hydrogen and hence less latent heat loss to the flue gas.
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I have been investigating the air source heat pumps. I ruled out ground source heat pumps as they require 3 phase electricity. The Mitsubishi Ecodan air source heat pump claims to provide a COP (Coefficient of Performance) of 3.6 over the year. Therefore one 1 kWh of electricity is converted into 3.6 kWh of heat output.
A quick calculation as based on the latest oil price at 60 pence per litre shows:
1 litre of fuel oil provides about 10 kWh of heat.
Fuel oil cost is 6 pence per kWh
My boiler is about 80% efficient
Therefore 1 litre of oil provides 8kWH of output @ 80% efficiency
Oil therefore is costing 7.5 pence per kWH
Using one of the energy web sites, Scottish Power will sell me Electricity at 8.46 pence per kWh with no standing charge for all units over 900 kWH per annum (first 900 kWH is 14.72 pence per kWH). Excluding the fist 900 units, the air source heat pump cost per kWH will be 2.35 pence with a COP of 3.6. (8.46/3.6 = 2.35)
OK - I estimate the cost of installing a heat pump in the region of £6000. Air Source Heat pumps do not require under floor heating like ground source heat pumps, and will work with standard radiators. Still lots to investigate etc etc.
p.s. above shows quick calculations at the end of a long day. Apologies if there are mistakes!!
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Why are we still using oil gas etc when there are real alternatives to them Air and ground source heat pumps... i have read many of the blogs in here and they apper to have been missinformed by some one... ashp or gshp can opperate in any typ of system or building there are no restrictions it is down to the over all system and design. I have an air/gshp working in my house with standard rads and my heating bill has crashed there is no co2 emissions other than the gas hob/oven the electric is from a green provider. we can make a difference if we want and most of all save money we got ours from ecoheatco.net give em a go.
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