New Haven Register (Sunday) (New Haven, CT)
HEATING OIL PRICES COULD LEAVE SOME OUT IN THE COLD
Keeping homes warm once weather turns cold may create burden for Conn. residents
With heating oil prices inching up slightly heading into the back half of August, Connecticut homeowners could face $1,700 more in their heating bills through next May if prices do not budge from their current levels.
Statewide the third week of August, retail heating oil prices in Connecticut were averaging $4.70 a gallon, up 12 cents from the prior week according to a weekly survey published by the Connecticut Department of Energy and Environmental Protection. That ended an extended stretch of ebbing prices since the start of June.
While prices peaked the second week of May at $6.37 a gallon, the average price of heating oil in Connecticut remains nearly 70 percent higher than a year ago.
That is a new point of pain for some family budgets, after an extended stretch of low prices during the early stages of the COVID-19 pandemic.
The nonprofit Operation Fuel has seen more than 2,000 people apply for assistance with their heating oil bills only weeks into this year’s cycle, a record number according to Brenda Watson, executive director. For the 2021 fiscal year, Operation Fuel distributed $3.3 million in aid to nearly 13,500 households in Connecticut, averaging about $250 each.
“I’m not sure what’s going on — it’s too soon for us to figure out what’s causing the demand,” Watson said. “We typically see people seeking fuel assistance around late September through October when it starts to get cool.”
Watson said possible causes include higher fuel prices this year, worries about oil inventories heading into the fall, and inflationary pressure on household budgets including for gas and electricity at varying point this summer.
In Connecticut, about 44 percent of households rely on heating oil for their furnaces, according to the U.S. Energy Information Administration, compared to 36 percent which use natural gas.
In addition to Operation Fuel, homeowners can get assistance through the Connecticut
Energy Assistance Program, with eligibility determined by household income with a threshold of just under $48,900. Homeowners can get anywhere from $250 to $600 in assistance for heating costs, with eligible renters able to qualify for $100 to $150 in assistance.
Many oil delivery companies offer plans as well that spread payments out over 10 months to avoid billing spikes in January and February, with some offering 12-month plans.
Oil companies large and small are facing their own price pressure, as they look to hire up for the winter delivery season and as diesel prices remain high to top off the tanks of their trucks.
Jeff Woosnam, CEO of the Star Gas Partners parent company of Petro based in Stamford, said last month that his company is increasing its reserves for bad debt, while getting expanded borrowing capacity itself from lenders in case it needs extra cash to cover operating costs this winter.
“We have experienced high energy price environments in the past,” Woosnam said on a conference call with investment analysts in early August. “We’re focused on operating efficiency, controlling ... expenses and actively managing pricing and margins while remaining dedicated to providing the utmost in customer service.”
The great unknown, of course, is the mercury — an unseasonably warm winter would go a long way toward easing the pressure on households. But any prolonged cold snap could ratchet up the pressure even more, with nonprofits like Operation Fuel limited by contributions it gets from utility surcharges and privatesector contributions.
Watson said Operation Fuel plans to reach out to donors for any extra help they may be able to provide to boost its own ability to help households.
“We’re going to do a fair amount of that, especially as we get a sense of what’s happening and understand why people are applying at the rate that they are,” Watson said. “That’s the information that we can share with our donors.”