Consumers should brace for a slight bump in heating costs this winter as colder temperatures are predicted for much of the country east of the Rocky Mountains, according to a federal energy outlook released Thursday.
The warming trend from last year that caused unseasonably warmer temperatures last winter will not show up this season, although it will be slightly warmer on a 10-year average, according to the Energy Information Administration, the government’s lead energy forecaster.
Based on the most up-to-date government weather forecasts, temperatures this winter will be 3 percent warmer than the previous 10-year average, “but colder than last winter, which was 15 percent warmer than the 10-year average nationally,” the independent analysis arm of the Energy Department said.
Based on the lower temperatures, the need for all heating fuels will be higher, and thus the amount that households will be paying will be higher than last year.
“Forecast average household expenditures for heating oil, propane and natural gas are 38 percent, 26 percent and 22 percent higher than last winter, respectively, because of higher expected heating demand and higher fuel prices,” the forecast showed.
But don’t be too alarmed. Heating oil and propane expenses will be lower than in the past five winters prior to last year due mainly to the low crude oil prices over the last year.
“Natural gas expenditures this winter are forecast to be similar to expenditures in the five winters prior to last year,” it said, which bodes well for consumers since natural gas prices have been at record lows for years because of the fracking boom.
The amount of money households pay for electricity this winter will rise 5 percent from last season, the forecast said.
Going into the winter fuel season, natural gas will continue to push out coal as the nation’s dominant source of electricity production, according to the outlook.
Coal is at its lowest level since last year, producing 30 percent of the nation’s electricity while natural gas from shale is producing 35 percent.
In 2015, coal and gas were about neck-and-neck, producing 33 percent of the nation’s electricity supplies each. But the agency says natural gas has dominated in 2016 and that trend will continue in 2017, despite a slight bump in natural gas prices that will make coal a little more favorable.
“In 2017, natural gas and coal are forecast to generate about 34 percent and 31 percent of electricity, respectively, as natural gas prices are forecast to increase,” the forecast said.
