EIA predicts a rise in heating costs this winter

By Erin Voegele | October 11, 2017

The U.S. Energy Information Administration has released the October edition of its Short-Term Energy Outlook and Winter Fuels Outlook, predicting average household expenditures for all major home heating fuels will rise this winter due to expected colder weather and higher energy costs.

According to the EIA, natural gas expenditures are expected to rise by 12 percent, home heating oil by 17 percent, electricity by 8 percent and propane by 18 percent. Most of the increase is attributed to colder weather, rather than higher energy costs. The EIA said a warmer-than-forecast winter would see lower increases in expenditures, while a colder-than-forecast winter would see higher increases in expenditures.

Regarding wood heating, the Winter Fuels Outlook cites the U.S. Census Bureau’s American Community Survey as finding approximately 2.2 million, or 2 percent, of U.S. households used cord wood or wood pellets as a primary residential space-heating fuel in 2016. The EIA also said its Residential Energy Consumption Survey estimates an additional 9.3 million, or 8 percent, of U.S. households use wood as a secondary source of heat, making wood second only to electricity as a supplemental heating fuel in 2015.

According to the EIA, one in four rural households used wood for primary or secondary space heating in 2015, compared to 6 percent of urban households. The EIA said wood use was most common in New England, where 20 percent of households used wood.

The STEO currently estimates nearly 2.23 million households are expected to use wood as a primary space heating fuel during the 2017-’18 heating season, down 1.7 percent when compared to last winter. This includes 388,000 households in the Northeast, down 12.1 percent; 553,000 households in the Midwest, down 2.3 percent; 569,000 households in the South, up 4.4 percent; and 718,000 households in the West, up 0.7 percent.

The STEO predicts the residential sector will consume 0.386 quadrillion Btu (quad) of wood biomass during 2017, increasing to 0.413 quad in 2018.

Regarding power production, the STEO predicts wood biomass will be used to generate 113,000 MWh per day of electricity this year, falling to 112,000 MWh per day next year. Waste biomass is expected to be used to generate 58,000 MWh per day in 2017, increasing to 60,000 MWh per day in 2018.

The electric power sector is expected to consume 0.278 quad of waste biomass this year, increasing to 0.288 quad next year. The sector is also expected to consume 0.230 quad of wood biomass this year, falling to 0.224 quad next year.

The industrial sector is expected to consume 0.190 quad of waste biomass in 2017, falling to 0.184 quad in 2018. Consumption of wood biomass by the sector is also expected to fall, from 1.269 quad this year to 1.232 quad next year.

The commercial sector is expected to consume 0.047 quad of waste biomass in both 2017 and 2018. The consumption of wood biomass is also expected to hold steady at 0.078 quad in both years.