When Can We Anticipate Home Heating Prices to Subside?

With winter weather intensifying, homeowners in the U.S. are experiencing the problem of home heating costs. Recent years have seen a noteworthy increase in energy costs, leaving many in search of answers and relief. Uncover what has an impact on home heating prices, the recent trends we’ve seen and ways to keep your utility bills in check.

Different Kinds of Home Heating Fuel

Many fuels are used to keep homes warm and cozy in the United States:

  • Natural gas heats 48% of American homes.
  • Heating oil is the fuel used in 5% of homes.
  • Propane fuels another 5%.
  • Electricity warms 40% of U.S. homes. Fossil fuels remain the main source for making electricity despite the renewed focus on renewable energy sources like wind and solar. 

What Are the Key Influences on the Cost of Fossil Fuels?

Considering the above information, it’s clear that fossil fuels heat a large majority of North American households. Supply and demand is the most significant factor driving price fluctuations. An increase in supply—triggered by greater production and storage rates—usually lowers prices, while a surge in demand—caused by extreme weather, a booming economy and rising rates for alternative fuels—can cause prices to skyrocket.

Exactly How Much Has the Cost of Natural Gas Risen?

Domestic natural gas production outpaced consumption starting in 2017, resulting in a broad price decline through 2018. Unfortunately, demand has surged recently across all sectors, causing natural gas prices to reach heights not seen in roughly a decade.

In 2022, the average wholesale cost of U.S. natural gas hit its highest peak since 2008, attaining an average of $6.45 per million British thermal units (MMBtu). This massive increase represented a major leap of greater than 53% from the previous year, marking it as one of the steepest annual increases ever recorded.

Multiple factors contributed to the volatile rise and instability of natural gas prices last year. In early 2022, manufacturing hiccups caused by freeze-offs and a large draw from natural gas reserves nudged prices upward. Robust liquefied natural gas (LNG) exports to Europe and other countries, coupled with an increase in domestic demand due to cold weather, stretched the price range even further.

In the spring of 2022, prices roared past $9/MMBtu, only to tumble by 40% following the fire and subsequent closure of the Freeport LNG export terminal. This incident considerably cut U.S. LNG exports and redirected more natural gas toward storage. But, as the summer heat eased, prices climbed again, reaching a peak in late August.

Shifting into the fall, an uptick in natural gas production and higher-than-average injections into storage saw prices drop down closer to the five-year average. But, as temperatures dropped, the demand for heating caused prices to ascend again.

When Will Fuel Rates Cool Down?

The fluctuations in natural gas prices are indicative of the intricate interplay of factors influencing home heating prices. As we look forward to the rest of the 2023-24 heating season, the market’s past behavior offers insights into future price trends and the potential for cost-saving options.

As of late 2023, prices have come down from their previous highs thanks to robust production and reasonably mellow temperatures. Even though demand is still steady, forecasters suggest prices around $3.44/MMBtu this winter, offering some respite for house owners as we move through the heating season.

Ways to Cut Your Heating Bill

Regardless of how you heat your home or what prices are like, you can take several helpful steps to improve energy efficiency and reduce your heating bills. Here are a couple of suggestions:

  • Seal drafty windows and doors with caulk and weatherstripping.
  • Use curtains to your advantage, making sure to pull them open during the day for free light and heat and then drawing them closed each night to insulate your windows.
  • Add more attic insulation to keep heat from rising out of your home.
  • Buy a smart thermostat that learns your habits and adjusts the temperature accordingly to help reduce your energy usage.
  • Reduce the temperature on your thermostat when you’re out so you aren’t heating an empty house.
  • Don warmer clothes indoors so you aren’t forced to crank up the thermostat.
  • Schedule yearly furnace maintenance to keep your heating system in peak condition.
  • Install a whole-house humidifier. Moist air feels warmer than dry air, so you feel more comfortable at a lower temperature.

Keep Cozy and Warm in the U.S. with Service Experts Heating, Air Conditioning & Plumbing

Nothing is of greater importance to the Service Experts Heating, Air Conditioning & Plumbing team than your comfort and safety. Our services can also help reduce home heating costs, which is good news for your finances. With ACE-certified technicians at the helm, you can expect fast, long-lasting remedies to all your comfort needs. Our company’s 100% satisfaction guarantee means that if you’re not totally happy with our services, we promise to make things right.

As a company that prides itself on innovation, customer engagement and community support, you can trust Service Experts Heating, Air Conditioning & Plumbing to make a meaningful difference in your life and sense of comfort. For more insights into heating prices in the U.S. or personalized solutions to help reduce your utility bills, reach out to the professionals at Service Experts Heating, Air Conditioning & Plumbing. Call 866-397-3787 today to learn more.

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