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Heating Prices Up Across the Board

July 14, 2008

By Meghan Carey, The Eagle-Tribune, North Andover, Mass.

Jul. 14–The cost of staying warm this winter is going to be costly — even for those who don’t heat with oil.

Everything is increasing.

Oil is up more than $2 a gallon over last summer and the cost of other petroleum products is increasing at similar rates. Natural gas is up, and electric heat just had one increase and expects another. As though that’s not enough, the demand for wood is driving up the price of wood pellets.

And officials say there’s no way to predict how much worse things are going to get.

“You can’t make projections. There’s no way to know,” said Joe Broyles, energy program manager for the state Office of Energy and Planning.

The cost of kerosene, propane and heating oil started increasing in 1999, but have increased much more rapidly since September and October 2007, he said.

Kerosene averages $5.03 per gallon, propane is $3.28 and heating oil is at $4.68, according to Broyles’ office. Last summer, propane and heating oil averaged closer to $2.50 per gallon and kerosene was about $2.90.

“It’s hard to say what people will do,” Broyles said. “It’s a significant cost either way.”

Natural gas customers can also expect to see a significant jump this winter — 13 percent.

The average homeowner will likely pay about $1,600 for natural gas from November to April of next year, according to National Grid spokesman David Graves.

“I hate to say this, but the prices are climbing and we’ve had to make adjustments along the way,” he said. “This is the best projection and may well be subject to change.”

Last winter’s natural gas price was actually 1.6 percent lower than the year before, Graves said. But every other year in recent history was marked with an increase, and average bills this year will be the most expensive, he said.

And the invoices could get even more expensive as 2009 rolls in, he said.

Those natural gas prices will likely affect the rate New Hampshire residents pay for electric heat this winter, too.

Public Service of New Hampshire increased its rate by 5.7 percent on July 1 and expects to make another adjustment on Jan. 1, 2009, according to spokesman Matt Chagnon. Adjustments are based on what PSNH pays to operate — and it uses coal and natural gas to generate electricity.

Based on the recent increase, the owner of a 2,000-square-foot home would pay about $3,570 a year for electric heat. Last year, that price was $3,290, Chagnon said.

With the threat of unending increases and paychecks that haven’t seen comparable increases, more and more people are burning wood or wood pellets to supplement home heat. Doing so is much more economical, according to many experts.

The current price for a ton of wood pellets is $279, according to Jane Croteau with North East Coal Wood Pellets in Pelham. She expects that price will increase by $20 to $30 in the fall because of the cost of manufacturing and trucking the pellets, two things that are affected by the increased fuel costs.

Still, with a small increase, people could save up to 66 percent on heating costs when they have a wood stove or fireplace, according to Garon Kachanian, owner of Green Mountain Stove Shoppe in Derry.

“My prices are pretty much the same,” he said. “I don’t like doing that to people. I think it’s terrible what’s going on right now with the oil prices and people having to crunch down on their bank accounts.”

Kachanian estimated the price for a cord of wood, which now averages $225 to $325 based on the type of wood, will go up by $10 or $20 this year.

“Of course, with demand, that’s what’s going to push the price up somewhat,” he said. “But it hasn’t been that much.”

New England governors met in Boston last week and are urging federal officials to increase the Low Income Home Energy Assistance Program.

Gov. John Lynch said New Hampshire received $25 million last winter, but would need $50 million this year to provide the same level of aid.

“I think it’s potentially a crisis, and I don’t use that word lightly,” he said. “We don’t want our families to be in the situation of having to make choices between being able to buy food for themselves or filling up the heating oil tank in their homes.”

Material from The Associated Press was used in this report.

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Copyright (c) 2008, The Eagle-Tribune, North Andover, Mass.

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