Should You Repair Or Replace Your Inefficient HVAC System?

If your home was constructed before the mid-1990s and you're still using your original furnace or central air conditioner, you may be considering upgrading to a newer and more efficient system. Since the advent of the Energy Star program in 1992, manufacturers have made tremendous strides in reducing the electricity usage of these appliances. However, when a component of your HVAC system is acting up, it can be difficult to decide whether replacement or repair is the financially prudent choice. Read on to learn more about some of the factors you may want to consider when making this decision. 

If you're considering repair, you may want to take the following factors into consideration:

How long will the repair take? 

In today's busy world, time is money -- and in many cases, if a repair can be quickly and inexpensively performed in your absence, this may be preferable to having to take time off work to supervise the contractors needed to remove and replace your inefficient device.

Time is also a significant factor if your heater dies in the middle of a cold winter or your air conditioning unit stops working at the peak of summer. In these cases, a quick fix may be worthwhile if replacement would require you to vacate your home until a more habitable temperature can be reached. 

What is the expected lifespan of the repair?

To get an idea of whether a specific repair is worthwhile, you'll want to amortize the cost of the repair over the expected lifespan of the furnace or air conditioner. For example, perhaps your air conditioner needs a freon recharge and a new hose that will cost $150. These repairs are expected to provide another 5 years of useful life, so your annual maintenance cost will be less than $30. This is almost certainly a sound investment when compared to the cost of purchasing a new unit (as a new $3,000 unit would have to last 100 years to equal your $30 annual cost). If, on the other hand, you're looking at a relatively high-dollar repair that may not add much life to your appliance, replacement could be a more economical option.

Many HVAC repair companies will offer a limited warranty on parts or labor used to fix your furnace or air conditioning unit -- giving you a "free" repair or replacement if the unit requires the same repair over the next few months or years. If you'll have a warranty for the work being performed, you may want to take this into account when amortizing the life of the repair -- if the repair will be redone when the same problem recurs within 2 years, your break-even time may be much shorter. 

If you're considering replacement, you may want to take the following factors into consideration: 

Will other household fixtures need to be upgraded?

Energy-efficient heaters and air conditioners are frequently smaller and more compact than the older, inefficient HVAC components -- meaning that you may need to redesign the areas of your home that house these appliances. In most cases, replacement will free up room -- but if your furnace is located in an oddly-shaped or out-of-the-way location, you may need to do some tinkering.

You might also put some thought into upgrading other parts of your home that can lead to higher utility bills, like a poorly-insulated attic or drafty windows. By reducing the amount of heat that enters your home in the summer and escapes during the winter, you'll reduce the load on your heating and air conditioning units, extending their life.

Are tax credits available?

If you're upgrading from an inefficient appliance to one that has been certified as efficient by the federal government, you may be eligible for certain federal tax credits that can help put some money back in your pocket. For the 2015 tax year, you can receive up to 30% of the cost of your energy-efficient appliances as a dollar for dollar credit against your federal tax liability.

For more information, contact a company like All American Air & Electric, Inc.