Propane-heated homes feeling brunt of winter fuel expenditures

Average expenditures for U.S. households heating primarily with propane are expected to be 54 percent higher this winter compared with last winter. The Energy Information Administration (EIA), meanwhile, says expenditures for homes using natural gas will only be 10 percent higher; heating oil 7 percent higher; and electricity 5 percent higher. Information was derived from EIA’s latest short-term energy outlook.

According to EIA, persistently cold weather east of the Rocky Mountains drove up demand for all heating fuels, depleted inventories and put upward pressure on prices. Propane prices experienced an especially high spike during several weeks in January and February, EIA adds. EIA’s current estimates for winter heating expenditures are significantly higher than its pre-winter forecasts from a short-term energy outlook in October 2013.

In addition, between the beginning of October and the end of February, U.S. average heating degree days were 13 percent higher than last winter and 10 percent above the 10-year average, according to EIA. The Northeast was 13 percent colder than last winter; the Midwest and South were both 19 percent colder; and the West was 5 percent warmer. The extreme weather had the greatest effect on households in the Midwest that primarily use propane and on households in the Northeast that use heating oil, EIA says.

EIA’s current estimate for winter energy expenditures for homes heating with propane in the Midwest is $2,212. That figure is $759 higher than what EIA projected in October. The current estimate for average U.S. expenditures for homes using heating oil is $2,243, which is only $197 higher than what EIA projected in October.