Higher heating costs could burn a hole in your wallet this winter

Families affected by the pandemic face skyrocketing heating costs this winter, with year-over-year prices set to rise by up to 54% for some households, according to annual winter fuel outlook published this week by the Energy Information Administration.

“We expect households across the United States to spend more on energy this winter compared to several previous winters because of these higher energy prices and because we assume a winter that is slightly colder than the winter. ‘last year in much of the United States, “US Energy said. The information administration said in the report.

Prices are expected to increase by more than 40 percent for households using fuel oil, particularly affecting the North East; and will increase by 30 percent for natural gas and 54 percent for propane. Those who heat with electricity could see a 6 percent increase.

Shannan Phillips Hunt, a 47-year-old personal trainer in Bloomsbury, New Jersey, fears her family’s already tight budget may be strained even further by rising heating costs. She and her husband already have two jobs each, but still feel like they are living paycheck to paycheck. Last winter, her bill increased by a third, she told NBC News.

“We never changed our behaviors, we were doing the same things we kept doing and it was amazing how much money we spent,” Hunt said. “It was scary, are we going to be able to pay for this and afford this?” How far will it go?

This year, they replaced a drafty window with a new energy efficient one, and said they only turn on the heat in rooms their dogs sleep – and the dogs are already in sweaters to avoid shaking.

“When it comes to the middle class, we’re all pinched,” Hunt said.

At a press conference in August to deal with rising energy prices, President Joe Biden called on the oil and gas industry to increase production to meet demand.

“Production cuts made during the pandemic should be reversed as the global economy recovers in order to lower prices for consumers,” Biden said.

The global energy crisis is also putting pressure on prices in an increasingly interconnected global system. In Europe, natural gas prices rose more than 350% after a summer of high demand and low supply. This allows natural gas to be transported from US producers to ships destined for foreign markets.

Crude oil has climbed more than 60% this year, pushing up the prices of closely related heating oil.

Some energy economists argue that oil and gas companies have limited production in order to increase their balance sheets after years of weak profit growth following the reset of oil prices in 2014 from over $ 100 a barrel to $ 25.

“Shareholders have pushed companies to focus on capital spending and dividend growth,” said Paul Tice, senior energy analyst at Schroder Investment Management and assistant professor of finance at the Leonard N. Stern School of Business at New York University.

In 2019, US oil production was 12.29 million barrels per day. Currently, it is around 11 million barrels per day, according to the EIA.

Looking ahead to clean energy targets by 2030, low oil production is expected to persist for at least the next decade, with the United States aiming to reduce emissions and increase the use of alternative energy sources. . Americans should get used to mild winters with normal prices and cold winters that lead to spikes in prices, Tice said, noting, “This is the new normal.”

Experts say homeowners can take several steps to combat rising energy prices this winter.

“Insulation is the main thing that saves you money by creating an overhead ceiling. If you bought an expensive puffer jacket with holes, it won’t perform as well as one without holes, ”said Pascale Maslin, CEO of Energy Efficiency Experts in Silver Springs, Maryland. She and her team perform home energy audits, looking for where the heat escapes the most in the home and where improvements could be made.

More than 65% of the heat is lost in the attic, Pascale said, and insulation in attics and crawl spaces is one of the first areas to consider. She recommends cellulose or fiberglass insulation instead of spray foam, which can be tricky if not done properly and can lead to prolonged gas evolution.

Consumers should also consider replacing their thermostat with a programmable thermostat that maintains heat when the home is not occupied. Homeowners should also check with their state to see if they offer discounts for energy efficient upgrades like a new heat pump.

Assistance programs also provide relief, such as the Low Income Home Energy Assistance Program (LIHEAP). Consumers can check local community assistance programs and apply if their income in the past 30 days is below 200 percent of the poverty line. Other community actions and local programs can offer assistance to public services.

Stephanie Ruhle, Charlie herman and Haley’s Messenger contributed.

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