Bracing for higher heat bills

The chill of winter is approaching, and with it higher heating bills also are due.

Seventy percent of Missouri homes -- and more than half of all those in the country -- use natural gas for winter heating, so the higher rates will have widespread effects.

Natural gas prices are expected to rise by 10 percent overall, according to the Energy Information Administration, a division of the U.S. Department of Energy.

And with rates rising year after year, everyone -- especially people living on fixed incomes -- is looking for a way to hold down energy costs.

Quilts hang from windows or plastic sheeting gets taped over drafty openings. Scraps of blankets and old towels are rolled up under doorways in homes where senior citizens are just trying to scrape by, let alone stay warm this winter season.

James Dodd lives in one of those drafty, drawn-in houses where the windows are covered in heavy drapes and towels hang from the doorways. Dodd lives in an older home on Pacific Street in Cape Girardeau. With its high ceilings and open rooms, the house is difficult to keep warm on cold days. There are no storm windows, and the lack of a storm door at the back door lets breezes blow in.

"The attic is just cold if you go up there," Dodd said. "It should be insulated."

After moving into the house almost five years ago, the 75-year-old Dodd installed central heat and air but didn't have enough money left for insulation or storm windows.

He tries to keep his windows covered and doors sealed tight so that no cool drafts enter the house. His thermostat is set around 75 because he needs a warmer temperature for health reasons, and because he's cold-natured.

Experts say that dropping the thermostat by a few degrees during the daytime, and again at night when you're sleeping, can help save money. Installing insulation, adding caulking around windows and weather-stripping around doors can keep drafts from coming in.

Despite his precautions against the cold, Dodd knows his heating bills will rise as the temperature drops.

"There's not many ways to save," he said. "The bill's just a little bit more each month than what I draw."

Dodd is just one of the thousands of people who will see increasing costs on their utility bills this winter.

With higher rates come more customer complaints, a higher level of dissatisfaction and more disconnects for nonpayment of bills, said Kevin Kelly, public information officer for the Public Service Commission.

Utility companies must petition the PSC before any rate increases go into effect. The PSC verifies that the rate increases follow the market trends for natural gas.

Community action agencies offer assistance to people who cannot pay their heating bills. Under the PSC's cold weather rule, any elderly or disabled utility customer is able to register for a program that prevents them from having their utilities disconnected on days when the temperature is forecast to drop below 32 degrees.

Congress has awarded $1.9 billion to help low-income people through home energy assistance programs. But the amount of funding for the LIHEAP, or Low-Income Home Energy Assistance Program, hasn't changed since 1981, though heating costs and the number of eligible customers have risen, said Kelly.

Customers can do some things to help offset their rising gas bills. Simple things like signing up for budget billing programs can help keep the heating and cooling cost fluctuations to a minimum.

An energy audit can offer some tips for weatherizing a home, but the goal is to "do whatever you can to use it as efficiently as possible," said Mike Cleary, a spokesman for AmerenUE.

AmerenUE customers in Cape Girardeau, Scott and most of Stoddard counties can expect to pay $48.19 -- or 8 percent -- more per month than they paid during November through March last year.

Customers in Advance and Bollinger County will see an 11 percent -- or $60.18 -- increase in their bills.

Prices vary because of supplier costs, transportation, storage costs and differences in average customer usage.

Part of the higher cost is simply because of supply and demand. Natural gas is an efficient, clean-burning fuel that has become popular with factories and large industries that must meet federal clean air regulations.

Because of that demand from industries, the year-round cost of natural gas hasn't dropped in off-peak months. Coupled with the increasing demand, it's getting harder to find places to drill and explore for natural gas, Cleary said. Yet there are more gas rigs drilling today than there were a year ago.

The problem now is that some of those drilling operations were halted for several weeks because of hurricanes in the Gulf of Mexico and along the Florida coasts earlier this year. Now that those operations are back on track, the supply will rise but prices are still up. The demand for natural gas is increasing because cooler temperatures have arrived.

Cleary said AmerenUE doesn't actually own any natural gas wells, but buys the product and distributes it to customers. About two-thirds of the cost on a residential gas bill are related to the purchased gas adjustment, or the price that suppliers charge for the gas.

"We don't make a profit off buying the gas itself," Cleary said. Companies simply pass on the cost of buying wholesale natural gas.

Natural gas markets aren't regulated, so prices are based on competition. Colder weather drives the prices up. Since 2002, the price of natural gas has risen from $2 per 1,000 cubic feet to just over $7 per 1,000 cubic feet today.

ljohnston@semissourian.com

335-6611, extension 126