How long should you wait before replacing an oil furnace and its tank?
The heating season is approaching, and flashbacks to last winter keep bringing up the same questions: is it time to replace your oil furnace? While it may never be the right time for a major expense, it may well be time to take a careful look at the situation. I suggest that you think in terms of return on investment instead of only lifespan. So let’s rephrase the question: when is it profitable to replace an oil furnace and its tank?
THE LIFESPAN OF AN OIL FURNACE
Theoretically, the lifespan of an oil furnace is around 25 years. This estimate depends on a number of factors, in particular the amount of regular and preventive maintenance that was done on the equipment over the years. A well-maintained oil furnace has a much longer lifespan than one that was neglected. Have you been a forward-looking owner? When was your furnace last checked or cleaned? When was the chimney last cleaned and the filter last changed?
If your oil furnace is showing signs of wear and tear, in the interest of avoiding unpleasant surprises as a result of a major malfunction, maybe you’ve thought about signing up for an annual protection plan that includes annual maintenance, emergency repairs, parts and labour. The annual cost of this kind of protection plan can be a few hundred dollars, which of course gets added onto your home heating energy bill.
Aside from the additional cost of running an aging furnace, you also have to consider what is happening to its energy performance. When we talk about energy performance, we are talking about the amount of energy that is actually converted into space heating. For example, an oil furnace that is more than 15 years old will generally be down to 70% fuel efficiency. A furnace that is more than 20 years old will likely be down to 60%. What does this mean? That 30% to 40% of what you spent on heating did not go towards heating your house.
THE LIFESPAN OF AN OIL TANK
When assessing the lifespan of an oil furnace, you have to take into consideration the age of the tank. Outdoor tanks between 15 and 20 years of age are considered to be in their twilight years. Indoor tanks have an estimated lifespan of 25 years. Since the early 80s, the manufacture date has been marked on the tank. If this information does not appear on your tank, it is definitely time to replace it. For example, the cost of replacing an oil tank with a 10-year guarantee against corrosion is approximately $1,500.
Without even taking into consideration the age of the tank, if it is regularly left empty over the summer months, or if there are perceptible areas of seepage at the base, you likely have an issue of humidity and corrosion. Don’t wait until the smell of oil permeates your basement or you start having nightmares about the cost of decontaminating the ground before you ask your fuel supplier to inspect your tank. And on top of it all, many people don’t know that it is now difficult to insure or sell a house with an old oil tank. Your insurance broker or a potential buyer of your house may request that the tank and heating system be inspected. The outcome of this inspection might cause the deal to fall through.
So when is it profitable to replace an oil furnace and its tank? I encourage you to give some thought to switching from oil to natural gas, Natural gas furnace is a much cheaper energy source than oil, and will probably very quickly prove to be more sensible and economical.
Comparing the cost of heating between different energy sources
Choosing an energy source based on its price and advantages
To reduce your energy bill, take the age and fuel efficiency of your furnace into consideration
Supervisor, Residential market development