Gas Heating Increases Profits For Lancaster PA Apartment Complex

Pioneer Woods-1

It’s no secret that electric heat has been getting more expensive. The cost of electricity has been rising for at least a decade. For the owner of apartment complexes in the Lehigh Valley, the pricing was actually starting to cost him more money than just his heating bills.

One of his properties in Lancaster PA had a high turnover. Many tenants were not staying long because of their electric bills in the winter. This wasn’t a problem his other properties. But, those places didn’t have electric heating.

Because of this, our property owner was ready to make a change for his 161-unit complex: an electric-to-gas conversion. For a big HVAC investment like this, he called UGI Heating Cooling and Plumbing. We’re known for getting the job right the first time. That means everything from helping a client choose the right equipment to installing it properly to making sure the owner has all the proper permits to do the work.

Problem: An apartment complex in Lancaster PA was losing tenants due to their high utility bills.

Solution: Converted from electric to gas heat for the 161 units in the complex.

Electric versus gas heating

As the cost of electricity rises, other heating sources become more attractive. One of them is gas heat. Not every area has the lines available to provide gas. But, much of the Lehigh Valley is equipped. As a result, more people have considered switching.

For a while, many people preferred electric. Or, at least, they didn’t want to convert. A new gas furnace costs more than an electric one. And, they don’t last as long. Even though a gas furnace can last 10 to 20 years, electric furnaces can operate for twice as long. And, gas furnaces need more maintenance.

However, the rising price of electricity has changed the game. In 2008, the average cost of one kilowatt hour was around eight cents. Today in Pennsylvania, the average cost is around 13 cents. That’s more expensive than what it costs in 12 other states right now.

As a result, the the drawbacks of converting to gas heat haven’t seemed as bad lately. There’s still a larger upfront cost and more maintenance. But, the month-to-month savings with gas are increasing. That’s outweighing those other points.

Meanwhile, unlike electric heat, a gas furnace reaches its maximum heat almost immediately after it fires up. This allows it to heat an apartment faster than electric. This also helps keep the cost down. The gas furnace doesn’t have to run as long, or use as much energy, as an electric one.

In the case of this apartment complex, those monthly utility bills had the most impact. The tenants here wouldn’t have to pay for the conversion. And, they don’t have to worry about maintenance.

All they saw were larger energy bills than in other places. And, that was enough to make them look elsewhere.

Saving money for renters with gas heat

Just converting to gas heat would save a lot of money for the tenants of this apartment complex. But, we went a little further. Our staff worked closely with the property owner to find the best furnace and air conditioner for his complex.

Ultimately, the property owner chose a high-efficiency Carrier furnace. By choosing a unit like this, he could conserve even more energy. That, of course, would translate into lower costs for his tenants.

A furnace’s efficiency is measured by Annual Fuel Utilization Efficiency, or AFUE. This is a measure of how much energy the furnace uses for heat. That’s as opposed to how much energy is lost in exhaust instead of being used properly.

Older models can have as low as 70 percent AFUE. That means 30 percent of the gas is, essentially, wasted. The one our property chose, however, is much better.

The new gas furnace has 96 percent AFUE. That’s more than enough to earn it an Energy Star rating. This means it’s even more efficient than other models on the market today.

And, all those numbers add up to savings. Switching to gas and choosing a high-efficiency furnace had a very noticeable change for the tenants here. Now, they are saving up to 35 percent each on their monthly energy bills.

Cash rebates for conversion to gas heating.

Thanks to a gas heat conversion, this property owner’s tenants enjoy lower energy bills. That’s helping with retention. More are renewing their leases and keeping the building full.

However, to do that the property owner had to make a large investment to convert his HVAC system. Of course, that investment is already showing returns. But, we found ways to make it even better.

In many states, utility companies and other groups are encouraging people to upgrade to high-efficiency HVAC equipment. To do so, they offer rebates to people who make the switch. Pennsylvania is no exception.

For a job as large as this, we made sure this property owner got the biggest cashback offer possible. It turned out that his gas provider, UGI, offered rebates for installing Energy Star units.

We helped arrange for him to get a $500 rebate for each unit. Over 161 units, that added up to more than $80,000 in rebates.

Now, this apartment complex has a more efficient furnace that uses less expensive energy than before. More tenants are sticking around now that their energy bills are lower. And, our property owner got a major discount on the conversion cost.

Are you looking to convert your heating source for cleaner energy that costs less to run? Contact us and we'll work with you to find the best system for your home or investment property.