The cost to switch from oil to gas heating typically ranges from $3,000 to $7,000, depending on system size, installation complexity, and local pricing.
Switching from oil to gas heating can save homeowners $1,000+ annually while improving convenience. But conversion costs range from $3,000 to $12,000 depending on your home’s setup. This guide breaks down all factors affecting price and helps you determine if switching makes financial sense.
What Determines Oil to Gas Conversion Costs?
Every home’s conversion project differs based on existing infrastructure. These elements impact your total cost:
1. Gas Line Installation
If no gas line exists, extending service from the street costs $1,000-$3,000. Some utility companies cover this if multiple neighbors convert simultaneously.
2. New Gas Furnace or Boiler
Replacing old oil equipment with gas models runs $3,500-$7,500 installed. High-efficiency condensing units cost more but save long-term. See top-rated gas boiler options.
3. Chimney Modifications
Oil flues often need $750-$2,000 liners to handle gas exhaust moisture. Condensing units vent through sidewalls, avoiding this cost.
4. Additional Gas Appliances
Many homeowners add gas water heaters ($800-$1,500) or stoves during conversion for greater savings.
| Component | Cost Range |
|---|---|
| Gas line installation | $1,000-$3,000 |
| High-efficiency gas furnace | $4,500-$7,500 |
| Chimney liner | $750-$2,000 |
| Gas water heater | $800-$1,500 |
How Much Can You Save Annually?
The U.S. Energy Information Administration estimates Northeast homeowners save $1,077/year switching from oil to gas. Savings come from:
- Lower fuel costs (gas averages 30-50% cheaper than oil)
- Reduced maintenance (no oil filter changes or chimney cleanings)
- Higher efficiency (modern gas systems reach 95% AFUE vs 80% for oil)
According to PSE&G, most homeowners recoup conversion costs in 3-7 years through these savings.
Key Steps in the Conversion Process
1. Utility Company Consultation
Contact your gas provider to verify service availability. They’ll assess if street mains can support additional homes.
2. HVAC System Evaluation
A licensed contractor examines your existing setup. They’ll recommend properly sized equipment and identify needed modifications.
3. Permit Acquisition
Most areas require permits for gas work. Your contractor typically handles this for $100-$300.
4. Equipment Installation
Professionals install the gas line, furnace/boiler, and any additional appliances. This takes 1-3 days.
5. Safety Inspections
The utility company and local building department must approve the installation before activating service.
Important Considerations Before Converting
Answer these questions to determine if switching makes sense:
How Long Will You Stay in Your Home?
If moving within 3-5 years, you may not recoup conversion costs. Long-term homeowners benefit most.
What Incentives Are Available?
Many states offer rebates up to $1,000 for high-efficiency gas conversions. Check DSIRE for local programs.
Is Your Oil Equipment Near Replacement?
If your oil furnace/boiler is under 10 years old, conversion may not be cost-effective yet. Wait until major repairs or replacement are needed.
For homes needing new heating systems anyway, converting to gas often provides the best long-term value. Modern gas systems offer superior efficiency, lower operating costs, and reduced maintenance versus oil alternatives.
