What is the problem with oil heat? The oil itself is expensive!! It costs us approximate $650 to fill up our tank in the current market. We had to fill it up four times during the winter and once in the summer to heat our hot water and that still meant trying to keep the house at an average of about 60 degrees. That comes out to an average of $520 for the fall/winter months mid-October through mid-March. In comparison when we had gas heat in our old home of a similar size, the highest month in the winter would be $185 and during the summer $35.00. My guess is that if I had to estimate how much oil was for us during the coldest month in the winter, it would probably be around $650!!
Since gas is not available in our area, my husband and I started looking at alternatives. Many suggested a pellet stove to insert into our existing fireplace. I had never heard of such a thing so I was a bit skeptical, but my husband insisted. Since we plan to be in this home for the long term, we made the investment. We are impressed. That little thing has kept my bottom floor at a cozy 70 degrees and can keep the upstairs to about 55 degrees during the coldest months (in the 20s outside) with no help from the oil heater. And the top floor heats up only because hot air rises and finds its way into the top floor. The oil heat acts only as supplemental heating to keep our upstairs in the mid-60s.
The pellet stove runs partially on electricity and mostly on wood pellets. We were able to find a place that sold the pellets for $250 a ton and most people are estimating we needed 3 tons this past winter. The electricity use did get bumped up about $80 a month. Doing the math on the pellets vs oil, with the pellet stove I am now spending around $420 a month (taking into account electricity, supplemental oil heat, and pellets) so I am saving around $500 for the season. I saved $500, but still kept the house at an average of 8 degrees higher than last year. If I would have kept it at the same temperatures, my savings would have been significantly more.
My house is a 2000 sq foot above ground colonial (2 levels above ground). I am not accounting for the space for the basement as it is now unfinished. Our stove is also not located in the best location and the installers warned us that it might not be able to heat the upstairs too well. Even so, it is still doing a pretty decent job. If your pellet stove is in a central location, you can potentially save even more. If you currently have oil heat and/or electric heat, it most definitely might be worth looking into a pellet stove. We are certainly glad we did.