Tax Returns Bring Mainers an Opportunity to Cut Heating Costs

March 5, 2014

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Monday, March 3, 2014, and found the current statewide average cash price for No. 2 heating oil was $3.86 per gallon, down one cent from last week. The average statewide price for kerosene remained the same, at $4.32 per gallon. The average statewide price for propane (for heating customers) decreased by one cent, to $3.52 per gallon. Heating fuel prices are 33 cents (heating oil), 38 cents (k-1), and 87 cents (propane) more per gallon since the heating season began in October. Last year at this time, heating oil averaged $3.78 per gallon; kerosene, $4.25, and propane, $2.76.

Another week of stable prices serves as a good sign as we approach the end of winter. This heating season has been one of the most expensive heating seasons on record for Maine families. As tax season approaches, homeowners have an opportunity to use their refunds to make themselves even less beholden to high heating costs. For the first time, the state has made financial incentives available to Mainers to reduce their heating costs. This program, proposed last year by Governor LePage, provides rebates and financing for Mainers to install energy efficient heating systems and other efficiency measures, such as insulation. So, whether a homeowner is interested in installing an efficient heat pump, a pellet stove, or adding insulation, financial incentives are available. A few of the incentives available are listed in the chart below.

Residential Heating Incentive Program
Efficiency Measure Costs to Consumer (before incentive) Financial Incentive Estimated Savings per Year Payback Period (years)
Air Sealing $850 $400 $350 1.3
Insulation $8,000 $1,500 $1,200 5.4
Ductless Heat Pump $3,500 $500 $900 3.3
Supplemental Heating System
(Pellet/Wood Stoves)
Varies $500 Varies Varies
Heat Pump Water Heater $1,500 $300 (rebate) $250 4.8

Source: Efficiency Maine

The residential heating program is administered by Efficiency Maine. More details on the program, including a complete list of available incentives, are available on their website http://www.efficiencymaine.com/

Using this week’s average heating oil price ($3.86) and converting to a common heating unit value (million Btu), the price of fuel oil is $27.83. This compares with an equivalent heating unit value for natural gas of $15.50 (at $1.55/therm); propane, $38.54 (at $3.52/gallon); kerosene $32.00 (at $4.32/gallon); wood pellets, $14.67 (at $242/ton); cord wood, $11.36 (at $250/cord) and electricity, $43.96 (at 15 cents per kwh). These fuel-only prices do not take into account the type of heating system, nor its efficiency. For example, the electricity cost is for traditional baseboard heat. Other electric heating technologies, such as heat pumps and electric thermal storage (ETS), may offer consumers energy savings. Cold climate heat pumps, a recent technological advancement, are much more efficient than baseboard electric heat, so total energy costs are lower than many other types of heating fuels. ETS offers savings by utilizing off-peak electric rates, available in many areas of the state.

The Energy Office has a calculator on its web site that allows consumers to obtain more detailed estimates of home heating costs, and the price impacts of various types of fuel, heating systems and heating appliances. Heating costs vary considerably from home to home. The home heating calculator can assist homeowners in finding the best heating option for their home, location, lifestyle, and budget http://www.maine.gov/energy/index.html

As of March 3, 2014


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

3.86

3.85

3.87

3.87

3.83

3.91

High

4.20

4.20

3.95

4.00

4.00

3.97

Low

3.60

3.60

3.75

3.60

3.60

3.90

Kerosene

4.32

4.35

4.31

4.35

4.28

4.30

Propane

3.52

3.54

3.61

3.42

3.39

3.67

It is important to note that the price for heating oil is a statewide average, and that prices in a given geographic region of the state may be considerably higher or lower than this average. This week, within the Energy Office sample, the highest heating oil price ($4.20) was found in one region in the state, and the lowest heating oil price ($3.60) was recorded in three regions. Also, the statewide average price for propane is based on a use of at least 900 gallons a year. Households using propane just for cooking or hot water generally pay a higher per gallon price. The table above provides current Maine cash prices in dollars rounded to the nearest penny.

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For Immediate Release

Contact:
Lisa Smith
(207) 624-7445
lisa.j.smith@maine.gov