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effective to do so, but the same reports also indicate tfaat there are many cases where the 

 conversions would be either impractical or simply not cost-effective in either the short- or 

 long-term. Accessibility to the natural gas distribution system, the relative prices of 

 electricity and gas, and the technical-stnictuial feasibility of the conversion are all factors that 

 influence the cost-effectiveness. 



For example, in EWEB's service area some 80% of the existing dwellings are heated 

 with zonal electric systems (either ceiling, cable or baseboard heaters). In general, these 

 homes could be converted to forced air gas furnace heating only at considerable cost. 

 Because the cost-effectiveness depends on the capital cost of the conversion, the relative 

 prices of electricity and gas, and the size of the heating load, it is unlikely that such fiiel 

 conversions would be cost-effective. In other cases, such as homes already having forced air 

 heating, such conversions may be appropriate. 



In the case of new single family homes built in areas served by local gas distribution 

 systems, there has been a significant shift toward gas space and water heating over the last 

 five years. The fact that this has occurred even in areas where the relative electric and gas 

 prices are not far apart is an indicator that other market forces are at work such as builder 

 and home buyer preferences. Thus, market conditions and perceptions seem to be enough of 

 an incentive to support fuel "choice" decisions. 



For fuel switching, the market conditions play less of a role because the cost- 

 effectiveness of a conversion decision is dominated more by the actual cost of the conversion. 

 In markets where there is fuel price disparity, gas availability and relative ease of conversion, 

 fuel switching seems to be proceeding. 



