K-factor
The degree day system is based on the amount of fuel a customer has consumed between two or more deliveries and the high and low outdoor temperatures during the same period. A degree day is defined as one degree of temperature below 65 °F in the average temperature of one day. In other words, to arrive at the number of degree days in one day, the official high and low temperatures for that day must be obtained. The two figures are then averaged, and the number of units this average is below 65 °F is the number of degree days for that day. For example, if for Tuesday, November 3, the high temperature is 70 °F and the low is 54 °F, the average is found by adding 70 and 54, which equals 124, and then dividing by 2. The resultant figure is 62, and by subtracting 62 from 65, it is determined that there were three Fahrenheit degree days that day.
The K factor is the number of degree days in any given period divided by the number of gallons of fuel oil used in a given period. Multiplying K degree-days per gallon by the number of gallon of usable fuel remaining in a tank gives the number of degree-days before a delivery is needed.
Read more about this topic: Heating Oil