DOE: Natural Gas is the Least Expensive Residential Energy Source

The U.S. Department of Energy confirms the cost advantage of natural gas over other residential energy sources.

Every year, the Department of Energy publishes in the Federal Register an annual calculation of the average unit costs of residential energy. The DOE forecasts the average cost estimates for electricity, natural gas, No. 2 heating oil, propane and kerosene. The notice, dated March 17, 2021, provides an official marker that natural gas is the lowest-cost source of energy available for households.

DOE has a legal obligation to provide information to manufacturers and other agencies to calculate the cost of operating appliances. Notably, these are costs used for calculating the dollar figures on the yellow stickers found on water heaters, dryers and other equipment so that you know how much it will cost for heat or hot water using that appliance

Here are the numbers:

Representative Average Unit Costs of Energy for Five Residential Energy Sources (2021)

The average cost of natural gas is the lowest among residential fuels. Electricity remains the highest. Based on these figures, an electric appliance would need to be nearly four times as efficient as natural gas for a consumer to break even on the operating costs of running that appliance.

In the U.S., one home or business connects to natural gas service every minute. Households that use natural gas for heating, cooking and clothes drying save, on average, nearly $900 per year compared to homes using electricity for those applications, one of many reasons people prefer natural gas.

Importantly, energy affordability is a vital issue for many Americans. One in three households in 2015 faced challenges in paying their energy bills, a figure that may be higher today as the COVID-19 pandemic and economic recession affect household and business finances.

As we picture the potential, reimagining the industry for the future, innovating, cultivating the workforce and exceeding customer expectations, natural gas, and the affordability it brings, will be a cornerstone of the U.S. economic recovery.