Spike in heating costs hits home

High prices prompt many to cut back consumption

December 22, 2005|By MICHAEL DRESSER | MICHAEL DRESSER,SUN REPORTER

Gina Andres, a registered nurse at a Baltimore hospital, said the most she has ever paid for utilities was about $250. But when she opened her most recent bill, the figure of $315 was staring at her.

"I almost died," the Severn resident said. "If that's what November's like - and it wasn't terribly cold - I'm just waiting for what December will be."

Andres is one of many Marylanders who are getting a rude jolt in the form of sky-high home heating bills as falling temperatures and soaring energy prices combine to put a chill on family budgets.

A relatively mild November took some of the sting out of the price spike, but this month's chilly temperatures - already being reflected in some bills - have consumers looking to next month's natural gas or home heating oil toll with dread.

"It's only going to get worse," said Andres' colleague Terri Taylor, whose monthly bill for heating her three-bedroom Hanover home has soared from the $220-$280 range to $390. For the sprawling older houses in neighborhoods such as Roland Park and Homeland, the bills can be hundreds of dollars higher.

Like Andres, Taylor is a middle-income worker who earns too little to shrug off the increases and too much to qualify for energy assistance. Her family's only choice, Taylor said, is to "suck it up and pay it."

If national projections by the U.S. Energy Information Administration prove accurate, U.S. consumers of home heating oil can expect to pay 24 percent more to heat their homes than they did last winter. Compared with users of natural gas, they're getting off easy. The price of that commodity was predicted to rise 38 percent - and that estimate came before the recent chill.

Linda Foy, a spokeswoman for Baltimore Gas and Electric Co., said the company's average residential customer paid $646 for natural gas during last year's winter heating season, which runs from Nov. 1 to March 31. This winter, she said, that customer can expect to pay from $860 to $940.

Foy said the increase was a direct result of increases in the commodity price of natural gas, production of which was curtailed by Hurricanes Katrina and Rita.

"It is something we don't profit from," Foy said. "That cost is essentially passed on through to the customer."

Maryland consumers are adopting a variety of strategies to cope with the increases. Some are turning down thermostats to as low as 60 degrees. Others are cracking down on their family members' use of appliances.

"I made them cut back on their showers - absolutely no use of hot water in the washing machine," said Taylor.

The effects of expensive fuel are being felt severely in older neighborhoods with relatively large houses and the energy-saving technologies of a bygone era.

Kris Bailey, a self-described "slave-at-home mom" in Stoneleigh, said the price of heating her family's four-bedroom home built around 1945 has increased roughly 30 percent - from about $350 to month to roughly $500 - over the past year.

Bailey said the increase came in spite of the family's efforts to minimize the expected price shock by sealing cracks in the attic and installing plastic sheeting in the basement - among other measures.

"I tried to be right on top of it," said Bailey, whose husband, Charles, is a Baltimore lawyer. "I'd hate to think about what it would have been if I hadn't done some of the things I have been doing."

The mother of two said her thermostat last evening was set at 68 degrees instead of the 72 or so she'd prefer.

"I've got my fleece on," she said. The children "get a couple of extra blankets at night."

BG&E customers are seeing the break they received last month canceled out by the early December chill.

November was relatively mild in Baltimore, with temperatures averaging 2.6 degrees above the long-term norms. While homeowners were paying higher rates, they were using less fuel.

But December has turned much colder. Fourteen of the first 15 days of the month were colder than normal, pulling the month's average temperature more than 6 degrees below the norm.

That's costing everyone money - so far, homeowners are burning 24 percent more fuel than the average for December.

The cost of the higher use of fuel is compounded by stubbornly increasing prices, which have doubled since the gentle winter of 2001-2002.

Neil Gamson, an economist with the Energy Information Administration, said the most recent surge is largely a result of the Gulf Coast hurricanes, which affected both oil refineries and natural gas production. The longer-term trend is influenced by the world energy market and increases in the cost of crude oil, he said.

While these increases might seem to be the heftiest ever, Gamson said that heating oil prices rose 60 percent from 1979 to 1980, and natural gas rose more than 50 percent from early 2000 to early 2001.

Gamson said heating oil prices were actually higher on an inflation-adjusted basis in the early 1980s. But even when inflation is taken into account, natural gas prices may be at their highest price now, he said.

michael.dresser@aol.com

Sun reporter Frank Roylance contributed to this article.

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