While the calendar might say that the 2012/’13 winter officially starts on Dec. 21, those of us in the northern regions of the country know that winter weather is already here. For many of us, the cold weather not only marks the unofficial start to the holiday season, it also means high home heating bills are on the way.
The U.S. Energy Information Administration released its annual Short-Term Energy and Winter Fuels Outlook in October. According to this year’s projections, household expenditures for heating oil will increase 19 percent this year. If that estimate turns out to be accurate, it will mean households that burn heating oil will face expenditures higher than any previous winter on record. However, oil heat is not the only household heating fuel expected to experience significant price hikes this winter. Household expenditures for natural gas are expected to increase 15 percent, with electricity and propane measuring in at relative 5 percent and 13 percent increases.
Part of this increase is due to weather. For most of the country, last year was unseasonably warm. Although the EIA expects this winter to be an average of 2 percent warmer in the Northeast, Midwest and South than the 30-year average, that still means it will be 20-27 percent colder than last year.
The actual price increases of heating fuels are also a factor, with heating oil experiencing a 2 percent increase, natural gas a 1 percent increase, electricity a 2 percent increase and propane a 4 percent increase.
In addition to addressing fossil-based heating fuels and electricity, the annual report includes some very interesting data on the trends associated with household use of biomass heat. This year, the number of households nationwide that heat with wood is expected to reach more than 2.6 million, a 3 percent increase over last year. Use in the Midwest is expected to increase at the highest rate, by 3.6 percent to 651,000 people.
Data included in the report shows a steady increase in the number of homes that employ wood as their primary heating source. In 2006/’07 only 2.1 million people nationwide heated with wood. That number has increased every year since, reaching more than 2.5 million last year.
This EIA report was released pre-Hurricane Sandy, which leads me to wonder if the “Frankenstorm” will have a more significant impact on the number of households open to exploring the use of wood or wood pellets as their primary heating source.
First, I think there is a growing acceptance climate change science in the U.S. as catastrophic weather events continue to plague our nation, which may lead more people to take serious action to reduce their use of fossil fuels.
Second, the power outages, fuel distribution disruptions and various other factors could make wood and wood pellet use more attractive many in the affected region. Wood pellets are easy (and incredibly safe) to store, and aren’t impacted by downed power lines or other short-term fuel delivery problems.
In addition, I think price will continue to be a factor driving more use of wood and pellet heat. A recent article published by National Geographic does a great job of telling the story of one family in the Northeast has saved nearly $3,000 per year by switching its primary heating source from fuel oil to wood pellets.