WNY households projected to spend more on heating than they have in a decade
National Fuel Gas Distribution Corporation (“National Fuel” or “the Company”), the natural gas utility for 11 counties across Western New York, has issued its winter heating season forecast, and the unwelcome message is: Prepare for significantly higher heating bills based on the rising cost of natural gas. The Company estimates that based on the current market prices, the average residential customer will pay $1,023 to heat their home this winter – November through March – with expected increases over last year hovering around 50%. Locally, National Fuel customers haven’t seen winter heating season bills this high since 2008-2009. Last winter saw natural gas prices begin to spike but the winter weather finished 10% warmer than normal so winter heating bills came in lower than anticipated. This time last year National Fuel had predicted average winter bills to total $714 and the actual average was $684.
While predicting energy costs and winter weather are not an exact science, National Fuel does know that the summer purchase price it paid for natural gas currently being injected into underground storage fields, as an effective way to meet high winter demand, is nearly 50% higher than last summer’s storage gas prices. The New York Mercantile Exchange (NYMEX) natural gas pricing for deliveries this upcoming winter is substantially higher as well, recently topping $9 per MMBtu, an increase from last winter when pricing averaged under $6 per MMBtu. In comparison, just two years ago, gas pricing was at $3 per MMBtu.
The Energy Information Administration (EIA) projects that U.S. households will spend more on energy this winter than they have in several years. The reasons behind natural gas (and electric) bill increases are based on domestic and global factors. Geopolitical events, such as the war in Ukraine, are increasing demand for domestically produced liquified natural gas (LNG), exposing U.S. natural gas pricing to global market influences.
Demand for natural gas used to generate electricity is also up as electrical usage increases with rising economic activity in the aftermath of the COVID-19 pandemic. While these various factors might be complicated, the broad consequences follow the familiar economic principles of supply and demand, but there is a difference. Ordinarily, when demand goes up, the energy industry produces more supply, but natural gas pipelines are at full capacity and efforts to obtain permits for new pipelines, especially in the northeast, have been impeded by organizations and state governments that oppose natural gas.
Warm weather could push heating bills lower, since consumers would use less natural gas, while cold temperatures would drive bills higher since furnaces would have to run more. Gas supply costs are passed along to customers without mark-up or profit to National Fuel. Approximately 75% of each customer bill is the natural gas supply cost, and the remaining 25% of the bill is the delivery charge.
National Fuel is encouraging its customers to prepare in advance for the winter and higher energy bills. First recommendation, make sure home heating systems are operating efficiently and effectively to prevent wasted energy. Outdated heating and cooling systems and worn-out or not enough insulation can increase energy costs. Also, there are inexpensive ways for consumers to make their living spaces more energy efficient. The Company’s Conservation Incentive Program provides helpful tips to make a home more energy-efficient, thus using less energy to heat homes while cutting emissions in alignment with New York’s state energy goals. Tips can be found at www.fuelingtomorrowtoday.com/energy-sustainability-tips/tips-for-the-home/. Some common guidelines include:
- Reduce air leaks and cut as much as 10% from your monthly energy bill. Be sure to use caulk or weatherstripping to seal leaks around floors, walls, ceilings, ducts, fireplaces, plumbing, doors, windows, fans, vents and electric outlets.
- Set thermostats between 65° and 70° during the winter, and at 58° when away from the house for more than a few hours. By turning your thermostat back 10°-15° for eight straight hours, you can save about 5%-15% a year on your heating bill — a savings of as much as 1% for each degree
- Turn down thermostats automatically without sacrificing comfort by installing a programmable thermostat.
- Change or clean furnace air filters once a month during the heating season. Furnaces consume less energy if they “breathe” more easily. Use the arrival of your natural gas bill as your reminder to change the filter
- Warm air rises, so use registers to direct warm airflow across the floor.
- Close vents and doors in unused rooms. Close dampers on unused fireplaces
- Set your water heater to 120° or the medium temperature setting. Drain a quart of water from the bottom of your water heating tank every three months to remove sediment that can hamper the efficiency of your unit.
- Insulate water heaters with insulation blankets in accordance with manufacturer’s guidelines.
- Install water-flow restrictors in showerheads and faucets.
- On sunny days, open curtains and blinds on windows that receive direct sunlight. Close them at night or on cloudy days to insulate against the cold air outside
- If radiators are located near cold walls, place a sheet of aluminum foil between the radiator and the wall to reflect heat back into the room
Western New York customers have numerous payment assistance programs that can be tapped into to receive much-needed funds to pay their utility bill if they meet eligibility requirements.
Discounted-rate programs can keep bills at a more affordable rate and others forgive past-due amounts if the applicant pays the discounted rate on time each
month. A State program is available for customers who receive other government assistance and provides complete balance forgiveness resulting from a COVID-19 pandemic hardship. Any customer needing assistance managing their energy bill should call National Fuel at 1.800.365.3534 or visit the utility’s website today at www.nationalfuel.com to get more information on the following programs:
- Home Energy Assistance Program (HEAP) – opening Nov. 1st, this federally-funded program provides significant help with energy bills with grants ranging from $400 – $476 for basic and additional $400 for emergency grants.
- Bill Relief Program for NYS residential customers – A state energy bill forgiveness program for income-eligible customers in response to the COVID-19 pandemic. Residential customers receiving qualifying government assistant will receive a bill credit for unpaid balances for service billed through May 1, 2022. Customers must be enrolled in National Fuel’s Statewide Low-Income Program (SLIP) by Dec. 31, 2022, or have received a HEAP grant.
- Neighbor for Neighbor Heat Fund – $500 grants help customers meet basic energy needs with any of the following situations: disabled, have a certified medical emergency, at least 55 years old, recently unemployed or a veteran.
- Special Protections – safeguards exist for customers who live in households where all residents are 62 years or older, 18 years or younger or disabled.
- Deferred Payment Plans – special arrangements can be made for a repayment plan based on individual financial circumstances.
National Fuel does recommend that customers use the Budget Plan for predictable, stable monthly payments by estimating usage over a 12-month period. This plan prevents seasonal billing swings and takes the guesswork out of planning for utility costs by allowing a customer to pay a set amount each month and receive alerts anytime the set amount is scheduled to change. Based on the current winter heating forecast, the monthly average residential customer bill on the Budget Plan would be approximately $130 a month, versus seasonal highs of $250-plus a month this winter.
Convenient payment options are available with AutoPay, having a bill automatically paid on the due date using a credit card or bank account; and Pay by Text, a one-time payment via the website to store the payment method and then responding via text to pay subsequent bills.
As National Fuel customers prepare for the long winter ahead, customers should contact the utility to check eligibility in the numerous payment assistance plans as more financial support is available than ever before. Customer assistance is available Monday through Friday from 7 a.m. through 6 p.m. by contacting 1.800.365.3234.