energy prices

Big Ed

Power and Energy ,$tandard Oil they are all grabing a rai$e at the end of George's tour.....

Rodney Summers

Going up up up

There is a new report on prices going up, I use NG, they are saying the cost will go up 50%, but I see on my bill the actual gas cost is almost insignificant, most of the cost is in delivery etc, so it seems to me the cost of the gas has a lesser affect on the actual bill.
Another interesting thing, electric heating will go up 5%, where i am the electricity is largely generated from gas, so what gives....
Jay

Constantin

Simple...

... not all electricity is generated by gas. Even in Boston, 30% of the power is made by nukes, a good chunk by coal, etc. The marketplace of electricity providers is competitive from time to time and they have the benefit of long-term contracts, contracts that go well beyond those bought by the local utilities.

In fact, I heard that a lot electrical energy providers in this area are currently reselling the gas they had on contract into the spot market insead of firing it to make electricity. More profit that way!

Mike T., Swampeast MO

Hard to believe that the cost of natural gas is "insignificant". Gas bills and rates are notoriously difficult to understand.

In my area the PGA (purchase gas adjustment that's supposed to be the "cost" of natural gas to the utility) is currently 99 cents per therm.

To this the local utility adds 28.53 cents per therm for their operating costs and profits.

While natural gas is "deregulated" I believe that billing practices are similar throughout the US. There is supposed to be a "cost of the product" component and the "cost of delivering the product" component.

If your cost of delivery is exceptionally high, you're likely out east where a huge relatively new pipeline and distribution system has to be paid for. There's also the matter of paying for all the "free" boilers and furnaces supplied by the gas companies...

In my area at least, the ONLY way you know the PGA is by looking at your bill. The amount varies GREATLY among counties and even different communities. Trying to decipher just what goes into that PGA is an exercise is futility.

Utility companies actively buy, sell, trade and store natural gas. They engage in futures trading. How on earth they EVER determine the "cost" is beyond my comprehension.

Cost here just went up 10.2 cents per therm. This was from a rate increase requested in August and has NOTHING to do with the hurricanes. It does though have EVERYTHING to do with increased utilization of natural gas.

Press releases from the utility company are UTTERLY different than what I'm hearing otherwise. They claim the "average" customer will see a $10-$20 monthly increase. Piece in the local paper today said the "average" winter heating gas bill of $700 would increase to $1,000. Since heating season here is five months at the absolute max, there's a terrible discrepancy.

Every time I go in the basement, I pat the Vitodens installed last year!

RonWHC

It's also a balancing

act. Many of the gas fired generators are for peak loads; i.e. air conditioning. The idea is that the A/C season will end before it gets cold & the gas will be freed up for space heating.

Works most years. However, no one figured on Katrina or Rita. Just like women.

It also emphasizes the FACT that electricity should NEVER be generated w/ natural gas. Gas is a premium fuel that
should be used to best advantage. Electricity generation ain't it.

Bob W._3

Agreed. Many manufacturers have been putting in gas co-generation plants, which affects demand, and price. Maybe they know something we don't.

Greg Swob

fuel prices

It's tough to belive and understand exactly what it happening. All these 'official' forecasts show up, up, up and frankly they are probably right. Yet, the commodity spot market has dropped about $3.00/MMBtu over the last few days. Local predictions here are estimating $1.40 - $1.50 per Therm this winter, last year's peak was around $1.17.

Jason_15

Agreed

Ron, I agree gas isn't for electric generation. What can we do to slow down this alarming trend? I doubt that bitching to the utility would do any good. My utility doesn't even like to run the gas plants due to cost, but environazis have banned any new nukes in Wisconsin, and file lawsuits every time a dirt burner (coal) gets proposed. It's frustrating at best!!!

J.C.A._3

Looking at my last gas bill.....

The total in Eastern Ma.,(Keyspan) with all the adjustments and "delivery charges" added in......looks to be (by my calcs) about 1.81/therm. This is with just a pilot running so far, and as I read the bill, I get charged less, for more therms used.

I feel like the one legged man in the **** kicking contest at this point. If I improve my efficiency, I'll be paying a higher price , for not using enough of the stuff they want us to conserve. HUH?

How about some kind of reward for using less product and not "giveaways", in price breaks for those who consume more? JMHO. Chris

Justin Gavin_3

Greetings

Heh Mike,

How is the Vitodens doing for you?

Which model do you have?

johnnyd

Anyone ever calulate this as % of income?

Sure, heating costs will go up, and I'm with you on the confusion surrounding how utilities go about pricing this out to the consumer, but one thing I don't hear about very much is: what percentage of the average working household's income is taken up by home heating in the first place? As compared to car payments, insurance, credit card debt interest, etc.

Do the numbers. If an "average" household income is $50K and the average annual heating bill is, say $2500, that's only 6%. If that bill goes up 50%, to $3750, the increase itself ($1250) only accounts for 2.5% of that household's income.

Sell the boat. Eat out less. Pay off your 18% credit card bill.

Constantin

You hit it on the head

... most (and certainly not all!) households in America can still "afford" the reduction to their disposable income.

In the developing world, energy prices usually represent a much larger % of income for most people. Riots have broken out in Indonesia as a result of the subsidies to cooking oil, gasoline, etc. being cut. Their prices went up as much as 180%... in one day. On the other hand, this subsidy program was not only leading to widespread smuggling (of cheap fuel to other countries) but it also represented 1/3 of the total government budget.

Energy conservation, improvements in construction, etc. are not going to be put on the front burner until high energy prices start to hurt people materially in this country. So far, non-subsidized retrofitting of insulation throughout a house (i.e. closed cavity) takes years to pay back, even at todays energy prices...

Rodney Summers

Glad to see I am not the only one confused by his gas bill.. I haven't examined closely since last year, but I think the part they claimed for actual product was about a third of the bill, the rest being various charges. Probably can't be taken literally. I think it was around 1.80 a therm last year, so I am going to look at my next bill and see for this year. We have insulated more and I have made some corrections to the heater which I hope will have a small effect on the efficiency, but I will be lucky I think if the bills come out the same.
It is nice to vent though, I think electric would still be more expensive, and it certainly would be less environmentally sound.
Jay
BTW, I agree with the idea that NG should be prioritized for end users, it is clean burning, the power plants could justify the expense of technology to cleanly burn coal or oil which would leave more gas for home use.