Winter Heating Bills Could Soar

Home heating bills are expected to soar this winter and Americans, already struggling with high gas and food prices, are bracing for more financial hardship.

On average, consumers are expected to pay $1,182 to heat their homes this year, up 20% from last year, according to recent estimates from the Energy Information Administration (EIA).

While consumers may have some leeway in how they manage their heating bills and can take steps to make their homes more energy efficient, most experts say there is little we can do to escape higher energy prices.

More than half of America’s households use natural gas for heating purposes. The Northeast has the largest concentration of home heating oil users in the country. And the prospect of a 31% increase in the price of heating oil has the region on edge.

Many Northeasterners try to get a jump on heating oil prices by filling their tanks during the late summer and fall months when prices are typically lower. But this year’s run-up in crude prices has altered the usual seasonal pattern, and filling up now COULD actually cost more than waiting if crude oil prices continue to tumble as they have recently. Pre-buying is not the slam dunk it used to be.

One way that may be more managable is by going the "Level Payment Plan" route. This type of plan allows consumers to spread heating costs out over a longer period of time at a fixed monthly rate, which is based on the customer’s billing history. At the end of the year, however, if the consumer has used more or less than what is covered by the monthly payments, the bill is adjusted accordingly.