Central Oregonian

Temperatures will drop this winter, heating costs projected to be higher

Hurricane Sandy could affect the price of heating oil for Oregonians

Ramona McCallister

November 01, 2012

Depending on what part of the country Americans live in, they may see an increase in heating bills this winter.

The outlook from the Energy Department’s Energy Information Administration (EIA) projects that consumers will use more resources to keep warm this winter. These figures are based on national trends. They project that heating bills will rise 20 percent for heating oil customers, 15 percent for natural gas customers, 13 percent for propane customers, and 5 percent for electricity customers.

“The projections made at the national level do impact Oregon,” commented Ron Bannister of Oregon Heat.

Dan Elliot, a spokesperson for Oregon Housing and Community Services, said that the U.S. national winter 2012-13 heating season (Oct 1- March 31) forecast is about 2 percent warmer than the 30-year average, but 18 percent colder than last winter.

“EIA expects residential natural gas prices to closely follow last winter’s prices, and higher natural gas consumption will raise average fuel bills in the Midwest, Northeast, and South,” said Elliot.

Elliott noted that winter electricity bill forecasts are also higher because of a return to near-normal, colder weather east of the Rockies. However, for Oregon consumers, no change is expected in electricity consumption. EIA expects residential heating oil prices to average 2 percent higher this winter than last.

“Over the last eight winters, residential heating oil prices have increased more than retail gasoline prices,” commented Elliot.

The forecast is also that propane expenditures will be higher than last winter because of colder weather and increased demand, but for the West, it should remain unchanged.

There are also speculations as to whether Hurricane Sandy will impact Oregon heating costs. According to a report in the Los Angeles Times on Oct. 30, the possible impact of Hurricane Sandy on fuel prices depends on how quickly refineries along the Delaware River can return to service.

Elliot said that if refiners delayed producing heating oil for this winter, and consumer demand was high, there would be lower inventories to begin with.

“This was the case after Hurricane Katrina and Rita shut down the Gulf Coast production capacity,” he noted. “As gasoline prices shot up over $3 per gallon, refiners had incentive to produce more gasoline at a time when they would normally concentrate on heating oil production.”

Roger Reis, executive director for Oregon Heat, said that there are several agencies that provide assistance with heating costs each year. Oregon Housing Community Services work with 17 community action partner agencies across the state. Oregon Heat works with 31 community agencies across the state. The amount of assistance is driven by the percentage that people pay on their utility bills.

Reis explained that when demand goes up, price usage goes up, as does the amount in terms of percentage going to energy assistance. When demand is low, the need for assistance also goes down.

“So when we go into a mild winter, the monies go down, but the needs go down as well.”

Reis said that due to the current economy, they have seen a decrease in smaller donors, but larger donors have stepped up and increased their donations. The overall impact amounts to a 4 1/2 percent decline in money available for emergency assistance.

NeighborImpact provides energy assistance to Central Oregonians who are at risk of having their heat or electricity disconnected during the winter months. For the 2011 heating season, they were able to provide support to more than 6,504 households in the tri-county area. Of these, 12 percent, or 790 households were in Powell Butte, Paulina, and Prineville.

Funding levels for the current year, which started Oct. 1, are anticipated to be flat, and Janet Merrell, Emergency Services Director for NeighborImpact, said that they don’t anticipate the amount of people needing services to be less than last year.

Steven Murray, Food Bank and Winter Energy Programs Manager for NeighborImpact, said that their energy assistance year runs from Oct. 1 through Sept. 30.

“It really has just started for this heating season,” said Murray.

He said that the majority of requests in Crook County come in the form of electrical bills. Murray added that Prineville now has an office that is staffed all year, and callers should use the main NeighborImpact line.

Scott Cooper, Executive Director for NeighborImpact, had one of his staff share a story from last heating season, which he said really gives a human face to the need for heating assistance services, and other services in this economic climate.

“I had a gentleman come in who had been terribly assaulted. He was in terrible shape, and couldn’t work, so he fell behind on all his bills and rent. I recommended him for rental assistance, and made his pledge. He was overwhelmed by emotion, guilt, being ashamed to ask for help, and gratitude. He gave me one of the hardest hugs I have received here, doing this job and I have received many.”

For NeighborImpact call: 541-504-2155

For the Low Income Energy Assistance Program (LIHEAP) go to: http://www.oregon.gov/ohcs/pages/sos_low_income_energy_assistance_oregon.aspx

For the Oregon Energy Assistance Program (OEAP) go to:

http://www.oregon.gov/ohcs/pages/sos_oregon_energy_assistance_program.aspx