wrote:
I have a single story 1600sq ft home in the Pacific Northwest, it was
built in 1981. I'm currently looking at replacing my electric furnace
with a heat pump. Gas isn't an option at my home. Up here I'm looking
at heating my home as the primary usage. A/C would be a nice benefit
but really isn't a big deal.

After getting estimates from two heat pump installers they tell me that
it typically takes 4 years for a return of investment. I also heard
that a heat pump is 33 - 50% more efficient then my current setup. They
both gave me estimates between $8000 - $9000 for an install.

So looking at last years bills I spent a total of $1800 on electricity.
I figure to run the basics (hot water, lighting, basically everything
without heat) costs $65 a month. That's my August bill.

So $1800-($65x12) = $1020 on heating.

If I were to save 50% on heating (the high estimate) I'd save $510 a
year.

$8500 for install divided by $510 = 16.6 years for my return of
investment.

I understand there are other benefits (a/c in the summer, better
resale, etc...) but looking at my math it just doesn't make sense to
me. Am I missing something here? Is the 4 year return of investment
marketing b.s.? Or is my math wrong?

I should also add that I have a hot tub that I turn off and on as I use
it. So that $1020 number is high, which would mean my roi should be
even longer!

I really would like to justify the purchase but can't.

Thanks Sage

Seeing as you would have to assume that all of your electricity is now
used for heating and that the heat pump would not use any electricity
to hit that $9000 savings in 5 year mark, I would say that their roi
estimates were a little "optimistic".

Did they know how much electricity you actually use now before they
made their ROI estimate? Could be that your house is unusually well
insulated or you keep the thermostat set lower than most homeowners
they have worked with. Sounds like you would have to be quite the
aberration though.

Keep in mind that if you start using the air conditioning, your savings
will be even lower.