The American Gas Association predicts the average heating bill for residential gas consumers could increase by as much as 18% this winter.
AGA Pres. Mike Baly said, "Last year's winter was warmer than normal. If the 1992-93 winter is similar, AGA projects that residential natural gas heating bills will go up about 6%.
"If we see a return to normal winter weather, our projections show the average bill could rise by almost 18%."
AGA said the national average heating bill will be about $395, or $3.60/month higher than last year, if weather is similar to last year. If the winter is colder, the bill would be about $440 or $11.15/month higher.
Last year the average winter heating bill was $373. The size of the bills depend on the region of the country, home size, furnace efficiency, conservation measures, and other things.
Baly said the national average price for gas service to residential consumers could increase about 46/Mcf to $6.02 this winter, an increase of about 8%.
"This will result from an estimated 58/Mcf increase in the price of gas at the wellhead and an average decline of 12/Mcf in transmission and distribution costs.
"Last year, natural gas prices were extremely low as a result of low demand from the unusually warm winter, so the price increase projected here comes from a low starting point.
"Even with this increase, however, natural gas will still be the most economical choice for home heating in most parts of the country."
AGA figures $6.02/Mcf is the equivalent of heating oil at 81/gal.
Baly noted prices for natural gas service have been stable the past 5 years, averaging only about 42/Mcf in December and January, the peak heating months.
"That's a range of only about 7%, and that's an excellent record compared with heating oil prices during the same period, which varied as much as 61% in the same period."
He said from the 1988-89 heating season to the 1991-92 season, the residential cost of gas rose less than 3%.
"If this season's price projections are included, the average residential customer has seen the price for natural gas service increase only 10% during the last 5 years, or about 2%/year, substantially less than the general inflation rate. Not many other commodities, products, or services can make that claim."
Copyright 1992 Oil & Gas Journal. All Rights Reserved.
