Fuel costs jump, temperatures plummet, heating bills soar

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ALBANY — Colder temperatures and higher energy costs are combining for a big bump in utility bills for Capital Region residents.

In October, National Grid predicted its upstate natural gas customers would see a 32% jump in cost for the 2021-2022 heating season compared with a year earlier. This week it boosted that prediction to 37%, due to soaring natural gas prices.

That’s $183 more than last winter, but only for someone who burns 713 therms of gas — an approximation for “typical use,” which will vary greatly based on size and condition of house, thermostat setting and outside temperature.

After a balmy December, last month was one of the coldest Januaries in the last quarter century at the National Weather Service’s Albany station, as measured by heating degree days, a formula based on temperature.

February is right around average through the first half of the month, with a warming trend forecast for the second half — starting with enough of a warmup that flood advisories have been issued for parts of the region Thursday and Friday.

National Grid spokesman Patrick Stella said the utility hedges on energy costs, locking in long-term supply contracts at what it hopes is a low price point to smooth out spikes in costs. It is 70% hedged on electric and 50% on natural gas this heating season.

But at the same time, natural gas prices have increased worldwide and are at multiyear highs in the United States this heating season, Stella said.

“Wholesale natural gas prices jumped 46% on Jan. 27, 2022 — the biggest one-day gain ever,” Stella said via email. This was, he said, “precisely the day that prices are set for the following month.”

He said electricity would be 6% to 12% more expensive, resulting in an average cost increase of $32 to $57 this heating season.

National Grid does not control the price of gas and electricity and does not profit from its sale. It makes its profit from delivering gas and electricity to customers’ homes.

Customers at other utilities are in a similar fix. Con Edison, Central Hudson and Orange and Rockland all issued customer alerts in the past several days about significant price increases. 

Gov. Kathy Hochul last week called out Con Ed over the large bills its customers were surprised to receive. The state told Con Ed that while customers’ bills will likely increase much less than they would have without Con Ed’s hedging, the utility should reassess its practices to better smooth out large cost spikes and should better communicate these price fluctuations to customers.

Stella said National Grid does not terminate gas or electric service for nonpayment of bills during cold weather, and said it has multiple programs to assist those who are behind on their bills. As of Jan. 31, 226,507 of National Grid’s upstate customers were more than 60 days in arrears on a combined $352 million in charges.

The situation isn’t much better for people who heat with other fuels.

The New York State Energy Research and Development Authority reports that natural gas is the predominant heating fuel in the Albany-Schenectady-Troy metropolitan area, used in 60% of homes. Electricity is next at 16%, followed by heating oil or kerosene (14%), propane or bottled gas (6%) and wood (3%).

NYSERDA reports that as of Feb. 7, 2022, heating oil is 52% more expensive in the Capital Region than a year earlier; propane 19%; and kerosene 43%.

It has been a variable heating season so far.

November 2021 had more heating degree days than average but not radically more. December 2021 has the second-lowest number of any December in the last 25 years. January 2022 is roughly tied for fourth-highest in the same period. February so far is just about average.

“Things really switched after the first of the year,” said Brian Frugis, a National Weather Service meteorologist in Albany. Subzero temperatures were recorded on six days in January at Albany International Airport, but none in December and none so far in February. To the north, the wind chill factor dipped into the minus-30s in the Adirondacks, he said.

But snow has been sparse.

So far this century, Albany has averaged 31 inches of snow from November through January. This season, it had 13.8 inches. February had added a meager 1.6 inches to the seasonal total through Wednesday.

Frugis noted most of the big snow storms have skirted the Capital Region, hitting the coast, nearby inland regions, and New England instead.

“We’ve been on the northern edge of these storms,” he said.

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