I had to make a decision this morning on a HVAC system for a small retail center we are designing and pricing. An all electric heat pump system would be the lowest first cost, but I thought of the likely future fuel costs. I think gas will be a more economical future fuel than electricity or oil. So I decided to go with gas furnaces and a split system for the air conditioning.

The gold rush of Marcellus Shale Gas, in PA and distributed throughout the world, makes me cast my design vote to natural gas as the economical fuel of the future. Right after I made that design decision, I came across this video that does a great job illustrating gas fracking (the controversial aspect of the process). I strongly recommend watching it to better understand the process.

httpv://www.youtube.com/watch?v=VY34PQUiwOQ&feature=related

Traditionally, electric heat costs about three times as much as gas or oil heat. Since electricity is a much higher entropy (think higher energy quality) fuel, it will likely always be more expensive than gas or oil. It’s easy to turn a motor with electricity than with fossil fuels (which require an engine).

For many years, I’ve told customers it isn’t clear which fuel source will be the most economical for the long term. For example, if nuclear reactors got more cost efficient, electricity would have been the winner. Now the uncertainty is over and natural gas will be the winner. Let me know if you agree or see it differently.