When Will Home Heating Costs Decline?
With winter weather intensifying, homeowners in Buffalo are dealing with the pain of home heating costs. Recent years have seen a notable jump in energy costs, leaving many looking for answers and relief. Learn what impacts home heating prices, the recent trends we’ve seen and ways to keep your utility bills in check.
Types of Home Heating Fuel
A number of fuels are used to heat homes in the United States:
- Natural gas heats 48% of American homes.
- Heating oil serves 5% of homes.
- Propane fuels another 5%.
- Electricity warms 40% of U.S. homes. Fossil fuels continue to be the most used source for generating electricity despite the increase in renewable energy sources like wind and solar.
What Factors Impact the Price of Fossil Fuels?
Considering the above information, it’s clear that fossil fuels heat a large majority of North American households. Supply and demand is the biggest factor causing price fluctuations. An increase in supply—triggered by higher production and storage rates—typically lowers prices, while an increase in demand—caused by extreme weather, a booming economy and rising rates for alternative fuels—can cause prices to climb.
How Much Have Natural Gas Prices Increased?
Domestic natural gas production outpaced consumption starting in 2017, resulting in a broad price decline in all of 2018. But, demand has soared recently across all sectors, causing natural gas prices to achieve heights not seen in more than decade.
In 2022, the average wholesale cost of U.S. natural gas hit its highest point since 2008, attaining an average of $6.45 per million British thermal units (MMBtu). This surge represented a tremendous leap of over 53% from the previous year, marking it as one of the biggest annual increases on record.
A number of factors led to the erratic rise and uncertainty of natural gas prices last year. In early 2022, processing hiccups caused by freeze-offs and a substantial draw from natural gas reserves nudged prices up. Robust liquefied natural gas (LNG) exports to Europe and elsewhere, combined with a spike in domestic demand due to cold weather, stretched the price range even further.
In the spring of 2022, prices soared past $9/MMBtu, only to tumble by 40% following the fire and subsequent stoppage at the Freeport LNG export terminal. This incident considerably cut U.S. LNG exports and redirected more natural gas toward storage. But, as the summer heat eased, prices climbed once again, peaking in late August.
Shifting into the fall, a boost in natural gas production and higher-than-average injections into storage saw prices drop down closer to the five-year average. However, as temperatures dropped, the demand for heating caused prices to go up again.
When Will Prices Go Down?
The fluctuations in natural gas prices highlight the complicated interplay of factors influencing home heating fuel rates. As we look ahead to the rest of the 2023-24 heating season, the market’s past behavior offers insights into future price trends and the possibility of cost-saving options.
As of late 2023, prices have decreased from their previous highs because of robust production and fairly mild temperatures. Although demand is still steady, forecasters suggest prices around $3.44/MMBtu this winter, offering some respite for individuals as we move through the heating season.
Tricks to Trim Your Heating Bill
It doesn’t matter how you heat your home or what prices are like, you can take several practical steps to improve energy efficiency and lower your heating costs. Here are some suggestions:
- Seal drafty windows and doors with caulk and weatherstripping.
- Use curtains to your advantage, opening them during the day for free light and heat and then drawing them closed in the evenings to insulate your windows.
- Boost attic insulation to keep heat from rising out of your home.
- Invest in a smart thermostat that learns your behavior and adjusts the temperature accordingly to help reduce your energy usage.
- Dial down the temperature on your thermostat when you’re not home so you don’t pay extra to heat an empty house.
- Put on warmer clothes indoors so you don’t need to crank up the thermostat.
- Schedule seasonal furnace maintenance to keep your heating system in top shape.
- Set up a whole-house humidifier. Moist air feels warmer than dry air, so you feel more cozy at a lower temperature.
Bring Comfort Home in Buffalo with Sunbeam Service Experts
Nothing is more critical to the Sunbeam Service Experts team than your comfort and safety. Our heating solutions can also help bring down home heating costs, which is good news for your pocketbook. With ACE-certified technicians at the helm, you can expect quality, long-lasting answers to all your comfort needs. The assurance of a 100% satisfaction guarantee means that if you’re not truly happy with our services, you know we will make things right.
As a company that prides itself on innovation, customer engagement and community involvement, you can trust Sunbeam Service Experts to make a positive difference in your life and sense of comfort. For more details of what you can expect with heating prices in Buffalo or personalized methods to help lower your utility bills, reach out to the professionals at Sunbeam Service Experts. Call 716-427-6807 today to learn more.
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