Business

Investment can ease sting of heating costs

Delivery truck driver Donald Whitacre returns to his truck after pumping 200 gallons of home heating oil into a customer's tank March 6 during heavy snowfall in Winchester, Va. (Associated Press)
Delivery truck driver Donald Whitacre returns to his truck after pumping 200 gallons of home heating oil into a customer's tank March 6 during heavy snowfall in Winchester, Va. (Associated Press)

NEW YORK – After two years of flat or lower fuel prices, many residents will pay sharply more to heat their homes this winter, according to government forecasts out this week. There are a number of ways residents can blunt the expected rise in heating bills – beyond putting on a turtleneck.

Staying warm is expected to cost more because fuel prices are rising and forecasts call for cooler weather, in some areas, after two relatively warm winters. Natural gas, propane and electricity prices are expected to rise, affecting 94 percent of U.S. households. Heating oil users will catch a slight price break, but still pay near-record bills to heat their homes.

One obvious way to lower your heating bill is to lower the thermostat: Sleep under a few more blankets, watch TV in a sweater, and use a programmable thermostat to turn the heat down when you are away or fast asleep. The Energy Department estimates that a resident can save 1 percent on their heating bill for every degree a thermostat is set back.

A look at the government’s forecast for winter fuel costs shows why homeowners will want to use some cost-cutting measures this winter. Natural gas customers will pay an average of $679 this winter for heating, up 13 percent from last year. Electricity customers will pay $909, up 2 percent. Propane customers in the Midwest will pay $1,453, up 9 percent, and propane customers in the Northeast will pay $2,146, up 11 percent. Heating oil customers will pay $2,046, down 2 percent.

At the same time, funding for low-income heating assistance is falling. In 2010, Congress set aside $5.1 billion for heating assistance. This year Mark Wolfe, executive director of the National Energy Assistance Directors Association, is expecting $3 billion.

Many states and utilities offer incentives for home energy audits and home weatherization programs that include things like adding insulation, installing more-efficient windows, and replacing an old boiler or furnace with a new one.

These investments can pay for themselves in heating savings in just a few years, especially when energy prices are high.

Switching from oil heat to natural gas is expensive – it costs $5,000 to $10,000, depending on how much workers have to do to reconfigure the heating system. But the Energy Department says the average heating oil customer will pay a whopping $1,367 more this winter than the average natural gas customer and that gap is expected to remain wide. If it does, the payback for a switch would be four to seven years.



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