Natural gas prices fall but not bills
Customers should expect higher bills as utilities bought gas for winter heating at pricing peak.
Sunday, November 30, 2008
Natural gas prices, like oil, have dropped since this summer. But while that may sound like heating bills also should be lower this winter, utilities warn this may not be the case.
Prices on natural gas hit $13.50 per thousand cubic feet in July. Since then, they have dropped to about $7 due to the low demand for crude products, according to the New York Mercantile Exchange.
"Clearly, the economic slowdown is affecting prices," said Howard Gruenspecht, chief of the Energy Information Administration.
However, utilities are still recovering the high cost of supplies purchased this summer and put into storage for the months ahead, according to a report by the EIA.
As a result, the 58 million households that heat using natural gas will pay slightly more than last year — an estimated $889 for the average home for October through March heating season — which is an increase of about 3.6 percent, the agency report said.
However, the EIA also cautioned that actual prices could vary from region to region and depending on how well a home is insulated and what their utility company paid for the gas.
As utilities use up their stores, it is possible that utility bill charges for the gas may come down, said Marty Berkowitz, public information specialist for the Ohio Consumers' Counsel, a residential utilities consumer advocacy group.
"If your bill is on an annual cycle, you will see an increase. But if you're on a quarterly (billing) cycle, you may have already seen the increases and it could come down," he said.
The drop in natural gas costs also will have no affect on the customer charge increases approved by the Public Utilities Commission of Ohio earlier in the year, he said.
Duke Energy Ohio customer charges were increased to $20.98 per month as of Nov. 1, according to the company.
The OCC has appealed the increase to the Ohio Supreme Court, saying the increase unfairly burdens residents by not letting them offset the higher costs through energy efficiency methods. There is no estimated time for a decision, Berkowitz said.
Meanwhile, Vectren Energy is working through its own proposal for a customer charge rate increase with the PUCO.
Currently, customers pay $7.43 per month, but the charge could jump to $16.75 if approved, according to Vectren. A decision should be made on the case before the end of the year, Berkowitz said.
Be efficient, get $500
However, residents can save money on their bills by becoming more energy efficient. Add insulation, sealing, high efficiency windows, and a number other efficient products to your home before Jan. 1, and you can save up to $500 on federal income taxes. For more information on the federal tax credits and how they would apply to your improvements, visit www.ase.org.
Hamilton resident Linda Begley said she keeps the thermostat set at 65 degrees and uses a wood-burning fireplace and kerosene heater to keep her home toasty in the winter.
"If it is chilly, put on some clothes, curl up in a blanket and enjoy the fireplace," she said.
For residents worried about being able to pay their heating bills this winter, the OCC suggest contacting the natural gas or utility provider and sign up for its budget billing program.
Those needing assistance with their bills may contact the Emergency Home Energy Assistance Program at (800) 282-0880.
Contact this reporter at (513) 705-2843 or jheffner@coxohio.com.


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