How much cheaper is natural gas heating than oil heating?

It depends on where you live and the cost of the fuel.

You have to convert to the heating value of gas and oil, factor in efficiency, and then compare the cost per BTU's. For example:

Determine the cost of gas vs. oil in your area: For example, heating oil in Seattle is $4.10 per gallon while gas is $1.09 per therm.

Next, calculate the cost of fuel per MMBTU's. Knowing that heating oil has 138,690 BTU per gallon and natural gas has 100,000 BTU per therm, you can calculate using this equation:

$ cost
--------- X 1,000,000 = cost per MMBTU
BTU's

The result of the above step is $29.56/MMBTU for oil, and $10.87/MMBTU for gas.

Next, divide the above by the efficiency of the furnace. Oil furnaces are 80 to 90% efficient and gas furnaces are typically 83% efficient.

The net cost of the fuel per MMBTU is $34.78 for oil and $13.09 for gas in this scenario. If your old house uses 63 MMBTU a heating season, that is a total of $2,200 for oil and $824 for gas for the whole heating season