11 percent return on the dollar
by: Paul Kando
We recently gathered to hear a series of mini lectures at the 35 year anniversary open house at Mid-Coast Energy Systems. The annual open house was complete with exhibits, lunch for all comers and a birthday cake.
We learned about subjects as varied as aging in place, solar energy and how the company’s hundreds of service calls are organized and tracked — the computerized record of your home's systems resembles a patient record in a doctor's office.
One lecture was about “mini-split” heat pumps. My friend Bob Hardina was not rehashing theory, nor giving a sales pitch: he shared his experience with the devices in his own house. What caught everyone's attention was that his heat pump investment is paying an 11 percent return (a CD today pays a paltry 1 or 2 percent).
How could this be? Heat pumps are very efficient and they have high coefficients of performance (COP in tech-speak). The lowest COP is 1, but the COP rating for heat pumps are as high as 4 — in lay-speak they can be up to 400 percent efficient in their use of electricity.
If one kWh of electricity costs 16.5 cents and # 2 fuel oil (at 83 percent efficiency) delivers 34 kWh per gallon, a COP of 1 translates to a $5.62 per gallon oil equivalent (the cost to heat with an electric baseboard).
From there things improve fast: COP 2 = $2.80 per gallon oil equivalent, COP 3 = $1.87, and COP 4 = $1.41. For propane, which delivers only 24 kWh per gallon (at 90 percent efficiency), the values are: COP 1 = $3.96 (the current price of propane), COP 2 = $1.98, COP 3 = $1.32 and COP 4 = 99 cents per gallon equivalent.
By switching from propane to a COP 4 heat pump, Bob is saving = $2.97 per gallon of propane displaced by his mini split heat pump (that’s $3.96 minus $0.99). If he used oil, the savings would equal $4.21 a gallon ($5.62 minus $1.41).
Heat pumps work like your refrigerator. They transfer heat by pumping a hot fluid from one place to another. We “air condition” when summer heat is transferred from indoors to outdoors, but a heat pump can also pump heat in the opposite direction, heating rather than cooling the interior.
Heat pumps capitalize on the laws of nature, of which the most relevant to remember is that heat flows only from hot to cold. So, in a furnace we add heat-energy to make it flow from a register or radiator into a colder room. In a heat pump we do likewise.
The difference is that while in a furnace we burn fuel, in a heat pump we add the energy by mechanically compressing a liquid and we can choose the direction of the heat flow.