The cost of switching to renewable energy

There are two categories to consider when switching to renewable energy:

1. ‘Capital cost’ is the one-time, upfront cost to purchase and install the equipment.
2. ‘Operating cost’ is the ongoing monthly costs. This will factor in the equipment’s efficiency, annual maintenance, and the cost of energy being used (electricity, natural gas, or renewable gas).

The costs of switching to renewable energy will vary widely from house to house. Different building types with varying size, location, age, and efficiency will have a dramatic impact on the cost and feasibility of switching to electric systems.

Therefore averages can only be provided. Cost comparisons were generated with the FortisBC Energy Cost Calculator

Hot water

For a family of four with a mid-efficiency hot water tank using natural gas (non-renewable), switching to an electric hot water system will deliver about 1.1 tonnes of annual carbon emissions reduction for an upgrade cost of $1,700 to $2,900.

The table below shows:

• switching from a gas hot water system to an electric system (like an electric tank or heat pump) costs less in capital costs, with currently available rebates.
• operating costs for an electric premium tank are higher, but a heat pump, which is about 300% efficient, costs much less to operate per month.

Comparison of gas and electric hot water options

Although natural gas is currently less expensive than electricity, the overall lifecycle costs, which includes the purchase price, operation costs and maintenance costs over a 25-year period, electrical hot water heating systems are comparable to natural gas hot water heating systems if high efficiency electric options are chosen.

Hot water heat pumps may cost a premium but provide very low monthly operating costs, and currently have rebates of $2,000.

Space heating

For a family of four with a mid-efficiency furnace using natural gas (non-renewable), switching to an electric heat pump may deliver 1 - 9.5 tonnes of annual carbon emissions reductions for an average upgrade cost of $18,000 to $25,000 (minus rebates).

The table below shows there is a larger upfront capital cost to install an electric heat pump, which is reduced with the rebates available.

Although natural gas is currently less expensive than electricity, gas furnaces and boilers can only achieve a maximum of 100% efficiency, a heat pump can achieve efficiencies of 300% and higher.

That improved energy efficiency means heat pumps can balance out the low operating cost of natural gas, and provide summer cooling along with winter heating.

You can compare different upgrade options for your home at FortisBC’s energy calculator Home energy calculator (fortisbc.com)

Renewable gas (RG)

The additional cost of RG relative to traditional natural gas varies depending on the blend you choose. Fortis clients can designate between 5% and 100% of their natural gas supply as a blend with renewable gas.

At time of writing (January 2022), 100% RG costs 35% more than traditional natural gas. This does not necessarily mean your gas bills would be 35% higher, as your bill also includes fixed delivery costs.

Learn more about RG on our FAQ about natural gas

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*Cost comparisons were generated with the FortisBC Energy Cost Calculator, and by CityGreen Solutions (2021)