Oil-fired furnaces and boilers are a popular choice in areas of the country with limited access to natural gas, such as the Northeast. Oil-fired furnaces and boilers present an opportunity to use renewable fuels to heat your home. A number of companies are now offering heating oil blended with biodiesel, allowing their customers to reduce their dependence on foreign oil while drawing on a domestic energy source. The biodiesel blends also produce less pollution than pure heating oil.

A number of retrofits are possible for oil-fired furnaces and boilers, but before pursuing any retrofits you should consider the potential added benefits you could receive by simply replacing the furnace. The following retrofits are possible:

Vent Dampers

The most common retrofit is the addition of a vent (or flue) damper. A vent damper prevents chimney losses by closing off a boiler's vent when the boiler isn't firing. Steam boilers benefit from vent dampers more than hot-water boilers, and larger boilers benefit more than smaller ones. Vent dampers, however, may not be cost-effective with properly sized, newer furnace models. For older oil burners, converting to a flame retention burner is probably a better investment.

Barometric Flue Damper

During your annual service checkup, have your technician perform a draft test. If too much heat is going up the chimney, you may need to install a barometric flue damper. The cost is less than $100 and could save you about 5% of your fuel cost.

Derating or Replacing Oil Burners

Derating is the practice of installing a lower gallon per hour (GPH) rated nozzle in an oil fired combustion appliance to reduce fuel use. This often requires reconfiguring the shape/size of the combustion chamber and/or adjusting the fuel pump pressure, which is a job for a trained professional. The practice is also sometimes referred to a "down-firing."

Many boilers and furnaces in today's homes are oversized, particularly if you've upgraded the envelope of your home with new windows and added insulation. It is simple to reduce the heating capacity of your oil boiler or furnace to make it operate more efficiently by having a technician install a smaller nozzle. The cost is minimal and it could cut fuel bills by as much as 10%.

If you have an old, inefficient burner, though, you may want to replace the whole burner. A flame retention burner will block airflow up the chimney when the unit isn't running, saving up to 20% on fuel costs at a cost of about $500. Note that steam boilers should only be derated if the steam system is also modified to remove excess radiators, which is a difficult procedure.

Modulating Aquastats (Hot Water Boilers Only)

An aquastat controls the temperature of the hot water in a boiler, typically keeping it around 180°F. When heating needs are lower in the spring and fall, 180°F is higher than needed, and wastes energy. A modulating aquastat, also called an outdoor reset, senses outdoor temperatures and adjusts the hot water temperature accordingly. The units can save up to 10% of fuel costs, and cost several hundred dollars.

A cheaper alternative is to manually adjust the aquastat yourself, turning it down to around 120°F during the milder heating season. Consult your owner's manual or a service technician to locate the aquastat.

Time-Delay Relay (Hot Water Boilers Only)

A time delay relay is a way to squeeze the most heat out of your system without running the boiler. When the thermostat clicks on, the relay causes the boiler to circulate hot water through the system without turning on the boiler. After a set time, the boiler will fire up. A time delay relay costs about $100 and can cut your fuel costs by up to 10%.