Prepare for Higher Heating Bills this Winter
Filed under: Energy, Family Money, Personal Finance
This winter’s weather is forecast to be a little milder than last year’s, but many Americans will get a cold chill when they open their heating bills. So set aside a little extra cash now: The Energy Information Administration projects that average household spending will increase 3% for natural gas, 7% for propane and 8% for heating oil from Oct. 1 through March 31, compared to last winter.
According to the EIA’s Short-Term Energy and Winter Fuels Outlook, those who heat their home with oil will see their bills go higher than they have in any previous winter. Folks in the Northeast, where 80% of households rely on heating oil, will bear the brunt of the price hike. The EIA projects residential heating oil prices will average $3.71 a gallon, 33 cents more than last year.
There’s a little bit of good news, though, for those whose heating systems run on electricity: They can expect to pay about 1% less this year, according to the EIA.
In fact, fuel prices are projected to show increases a bit sharper than our bills: Natural gas, up 4%; propane, up 7%; heating oil, up 10%. And electricity prices are expected to be 1% higher. But that slightly milder winter weather — predicted in the Northeast, South and Midwest — means you’ll use a bit less energy to keep the cold at bay. The West is the exception: That region is forecast to be 3% colder than last winter.
Current inventories of fuel oil and natural gas are above the recent historical average, which could temper bills if it turns out Old Man Winter is crueler than expected. Propane stocks are at relatively low levels, but there should be enough to meet potential demand increases or compensate for supply disruptions.
