Oil vs Gas: Which is the best way to heat your home?

November 17, 2020
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If you’ve never lived in a house with oil heating before, then it’s probably not something you know much about. What fuel you use isn’t really within your control, you are either connected to the mains or you are not. 

But, it’s still worth while taking time to understand the differences between an oil and a gas fuel supply. 

In this blog we’ll compare oil and gas fuel, to help you understand the main differences between the two, and if necessary prepare for a home with an oil supply.

What are the main differences between oil and gas?

There are a few things that you need to look at to understand the differences between an oil and gas supply:

  1. How is the fuel delivered to your home?
  2. The geographical location of your home
  3. How much does the fuel cost?
  4. How do you pay for your fuel?
  5. How much maintenance is required on the heating system?
  6. What is the contracted period?

Delivery optionsOrdered + deliveredAutomatically via mains
Geographical LocationRural “off-grid”Urban/towns
Cost of heating per yearAverage £700*Average £550*
Payment optionsMultiple options
to suit budget
Multiple options
to suit budget
MaintenanceYearly boiler service, oil tank
checks + not letting tank run dry.
Yearly boiler service
ContractNoneUsually 12-18 months

*Based on DECC figures from 2020

#1 Oil vs gas: How is the fuel delivered to your home?

A gas supply is a low maintenance way to heat your home. Gas is automatically delivered to your boiler via a mains supply as and when you need it, meaning that you don’t need to worry about running out. Assuming that everything is working as it should, you don’t ever really need to think about it. 

In contrast, oil is stored in a tank and delivery via road needs to be arranged to refill it as required. We recommend that you do this when your tank reaches a quarter full. 

However, you should still keep an eye on your oil levels to ensure that your tank never runs too low or dry. This is especially true if you have an older tank, as there will likely be sediment and impurities settled at the bottom. If your oil level drops too low, this sediment could run through the heating system and cause problems with your boiler. 

In conclusion gas is delivered automatically via a mains supply, while oil deliveries are via road and have to be ordered when you are running low. 

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#2 The geographical location of your home/business

The key reason that you home or business will need to use oil over gas is due to its location. 

Homes that are in busier, built-up areas will usually be supplied with mains gas, which will therefore default as their heating option. 

However, if you choose to live in a more rural “off-grid” location, then your home or business will likely not be connected to a mains supply and you will need to heat your home with oil. This is part and parcel of living in a quieter location, at least until renewables become more effective in Scotland.

In conclusion, busier, built-up areas will be connected to the mains gas, whereas more rural areas will need an oil supply to heat their home or business.

#3 Oil vs gas: How much does the fuel cost?

The cost of fuel in every household will vary, so it’s very difficult to compare gas to oil.  However, there are a number of factors that will influence the cost of your fuel, including:

  • The efficiency of your boiler 
  • What size is the house?
  • How many people live in the house?
  • How many showers/baths etc do your household take?
  • Do you always have the heating on?
  • What temperature do you set the heating to?

When you move home you can choose your gas supplier, and ensure that you are on the lowest possible tariff for your home. The same can be said for your oil supplier, but you have the added bonus of being able to buy from a local supplier.

The DECC estimated that the average UK home spends approximately £550 on heating alone. Whereas the average oil spend for heating alone is around £700

Again, this will be highly changeable and dependent on a number of factors, but oil will be more expensive than gas. 

In conclusion in a like for like home, gas heating will cost less than oil heating. 

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#4 Oil vs gas: How do you pay for your fuel?

As well as understanding how much you need to pay for your fuel, it’s important to understand how you can pay for it. This will help you plan and budget effectively.

Gas is delivered automatically to your home as and when you need it. When you move in you can usually choose your supplier, and organise how you would like to pay. This ultimately depends on your provider, but there are a number of common ways to pay for your gas including:

  • Direct debit (monthly or quarterly)
  • Payment on receipt of bill (quarterly)
  • Prepayment metre

The most common payment type is via monthly direct debit. 

Although you use more gas in Winter and less in Summer, a monthly direct debit will remain the same throughout the year based on estimations. Assuming your metre readings are kept up to date, these monthly payments should cover your entire year, without leaving you in credit or debit. This is great as it means that you know exactly how much is coming out of your account each month and can effectively budget. 

In contrast, as oil is delivered via road to fill up your oil tank, the way you pay is slightly different. Planning and budgeting for your heating oil may take a little more thought than with gas heating. 

There are generally four ways that you can order and pay

  1. Order & pay online (upfront payment)
  2. Order & pay via phone (upfront payment)
  3. Full payment via direct debit (post-delivery payment)
  4. Monthly payment plan (via direct debit)

You can find out more about each of these payment options here. 

You need to remember that you will use more oil in the Winter, plus it may be more expensive. Therefore, ensuring you budget for your oil payments is even more important (unless you are on a payment plan) in the colder months.

In conclusion, gas has multiple payment options but is most commonly paid via monthly direct debit. Oil again can be paid for in multiple ways depending on how you want to budget.

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#5 Oil vs gas: how much maintenance is required on the heating system?

Boilers and heating systems are not cheap to replace, so taking some time to keep on top of maintenance can lower costs in the long run. 

The national grid is responsible for maintaining the gas line. But, the homeowner is responsible for maintaining their boiler. How often a boiler needs serviced will depend on the manufacturer, but it is usually recommended every 12 months.

In contrast, there are a few more moving parts with an oil heating system. You will need to:

  • Service your boiler (every 12 months)
  • Maintain the oil tank
  • Ensure the oil tank does not run dry

Read more about how to maintain your oil heating system here

In conclusion, a gas boiler needs maintenance whereas an oil heating system needs boiler and oil tank maintenance. 

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#6 Oil vs gas: What is the contracted period?

Wouldn’t it be great if you could always use the supplier you wanted, without being worried about contracts?

This doesn’t normally happen with gas suppliers. 

It’s common to choose a tariff with a fixed term, usually 12-18 months. This is a positive as it secures a lower price per unit than a non-contracted tariff and guarantees your supply at the agreed rate. This bolsters you against a rise in the gas price for your contracted term. 

However, it also means that you are contractually obligated to your supplier. You can leave at any time, but you usually have to pay an exit fee – a charge from your supplier that you will incur if you wish to leave your contact early. 

Not all suppliers charge exit fees, but if they do they are usually between £5-£30/fuel source.

On the other hand, oil suppliers generally do not have contacts. This leaves you open to use whichever oil supplier you wish (although repeat business is usually incentivised via lower prices and priority deliveries).

However, it also means that you are not guaranteed a price, which will vary based on a number of factors, including the time of year and whether you are on a payment plan or not.

In conclusion, gas supplies are usually contracted, whereas you are free to use whichever oil supplier you like (although you do get preferential treatment for loyalty).

In summary: Is it best to heat your home with oil or gas?

The decision of gas vs oil isn’t usually in your hands. It will either be connected to the main gas line, or it won’t. 

But that doesn’t mean you shouldn’t understand the differences between the two. Both have their pros and cons.

Oil is generally more expensive, and has a few more parts for maintenance. But on the flip side, it offers more flexibility with your supplier and more payment options than gas. 

If you are looking for an oil supplier then please get in touch with us

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