Annual Heating Energy and Fuel Cost from Degree-Days
The annual heating bill an upgrade is measured against: Q = 24 x HDD x UA turns the building UA and the climate's heating degree-days into delivered energy, then fuel = Q/efficiency and cost = fuel x price. A UA 500 house in a 5,000-HDD climate uses 60 MMBtu; at 80% gas that is 750 therms (~$900/yr), or at COP 3.0 electric 5,862 kWh (~$879) - the comparison a fuel-switching decision turns on. Energy scales directly with UA, so a 20% envelope cut is a 20% lower bill. Base-65 steady-state, no gains. An estimate, not a calibrated model.
Formula and source
Q = 24 x HDD x UA; fuel = Q/eff; units = fuel / {therm 1e5, oil 138,500, kWh 3,412}; cost = units x price.
The degree-day annual-heating-energy method Q = 24 x HDD x UA (base-65 degF) with the fuel and cost conversions, as compiled in the ASHRAE degree-day / RESNET references, by name.
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