Posted By Bob I on 13 Sep 2013 04:15 PM
Gas prices will change over time (where did I just read that?) whereas minisplit fuel, supplied by a PV system, will be a fixed price for the life of the system.
Good luck with that!
In net-metering states you might get grandfathered in on existing systems, but unless you're building in the next year or so, expect the net metering deals to change substantially over the next few years, especially in
states where third party ownership of rooftop PV is expressly allowed (MI is one of them) and growth rates in roof top PV installations are exponential.
If you're talking PV off-grid that's an even more expensive proposition- the lifecycle per kwh cost of the storage alone is daunting.
Getting to Net Zero Energy under a net-metered grid-tie will have a financial rationale in some circumstances, but I didn't get the impression that was anything like the design goal here. Getting a house to Net Zero in a N-MI climate with $IPs may have some difficult financial math hurdles to clear.
Gas prices won't stay at the current low, but it would take a significant and sustained increase in the price in MI without a corresponding increase in electricity pricing to be able to state that the lifecycle cost of heat from a mini-splits would be cheaper than gas. With some price inflation on gas they might become fairly equivalant though.
Not that I'm a big fan of combi boilers or other gas burners- there are other reasons to forgo the boiler for heat pumps, but the error bars on future energy prices are large, and over the past 5 years condensing gas would have been substantially cheaper to heat with than ductless at the MI averages, without a good narrative for how gas prices are going to double. Wellhead pricing in the $4/MMBTU range is sustainable (barely) from a producer-profitablity point of view and that's the current price (well above the $2 low of a few years ago.) A sustained price of $5 would make more known reserves profitable, but that would only yield about a 10-15% bump in the residential retail rate, and burnt in a condensing boiler would still competitive with 16 cent electricity in a mini-split. At $7-8/MMBTU at the wellhead, it would flip and mini-splits could be cheaper, assuming electricity stayed in the 15-16 cent range.
Basically, even at a COP of 3 you'd be getting 10,000BTU of heat into the house per kwh or 100kwh/MMBTU, which with 16 cent electricity is $16/MMBTU. With 15 cent electricity it's $15/MMBTU. At the current delivered
residential price average a buck or buck-ten annually , in a 95% efficiency combi boiler that's only $12/MMBTU. While there are states with 12 cent or cheaper electricity, MI isn't one of 'em, nor is there much reason to expect that MI power will drop 25% in price any time soon. There's substantial room for the retail price of gas to grow before it's more expensive than a mini-split there.
In different electricity and gas markets (and climates) the numbers stack up differently, but this is how it shakes out in MI- can't make the case for parity, let alone cheaper operating costs there. In IL & IA the spread is a bit closer, and in WA mini-splits are definitely cheaper with 9 cent electricity and realistic COPs in the 3.2-3.5 range competing against buck-twenty gas.