Heating Costs Could Chill Homeowners This Winter
Americans will pay more to heat their homes this winter as they feel something they didn’t feel much of last year: cold.
Prices for natural gas, heating oil and other fuels will be relatively stable. But customers will have to use more energy to keep warm than they did a year ago, according to the annual Winter Fuels Outlook from the Energy Department’s Energy Information Administration.
Last winter was the warmest on record. This year temperatures are expected to be close to normal.
Heating bills will rise 20 percent for heating oil customers, 15 percent for natural gas customers, 13 percent for propane customers and 5 percent for electricity customers, the EIA announced last week.
Heating oil customers are expected to pay an average of $3.80 per gallon, the highest price ever. That will result in record heating bills, at an average of $2,494. That’s nearly $200 more than the previous high, set in the winter of 2010-2011.
“It’s two different worlds. For most families this is still going to be an affordable year, except for those who use oil heat,” says Mark Wolfe, the Executive Director of the National Energy Assistance Director’s Association. “For them, it’s going to be very difficult.”
Just 6 percent of the nation’s households use heating oil, but they tend to be in some of the coldest parts of the country where heating needs are high, mainly in the Northeast. About half use natural gas for heat and 38 percent use electricity. Five percent of households use propane and 2 percent use wood.
Electricity prices will fall 2.3 percent to 11.4 cents per kilowatt hour, the government estimates. Propane prices will fall 8 percent in the Midwest to $2.02 per gallon and 13 percent in the Northeast to $2.95 per gallon.
Natural gas, propane and electricity prices are relatively low because of a dramatic increase in domestic natural gas production over the last five years. Natural gas is used to generate about one-third of the nation’s electricity and is instrumental in setting the price of electricity. Recently drillers have been increasing production of so-called natural gas liquids, including propane.
(Source: The Associated Press, 10/12/12)