State Releases Energy Plan Update as Oil Prices Rise

February 11, 2015

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Monday, February 9, 2015, and found the current statewide average cash price for No. 2 heating oil was $2.60 per gallon, up four cents from two weeks ago. The average statewide price for kerosene also increased over the last two weeks, and is now $3.14 per gallon (2 cents more). Average propane prices rose similarly, to $2.68 (for heating customers). A year ago at this time, heating oil averaged $3.88 per gallon; kerosene, $4.30, and propane, $3.51, generally the highest prices of last year’s heating season.

Crude oil prices have jumped approximately 12-14% over the last two weeks, and are now in the $51-$57 range. Energy market prognosticators have been doing a bit of speculating; some are predicting prices will continue falling, and others say prices will climb. Of those forecasting price increases, there are as many iterations as there are energy analysts. The only observation that appears certain is that prices have been, and will continue to be volatile http://www.bloomberg.com/news/articles/2015-02-06/these-experts-know-exactly-where-oil-prices-are-headed

During this time of significant turmoil in global oil markets, the Energy Office released an update to the 2009 state Comprehensive Energy Plan. Energy Office Director Patrick Woodcock briefed the Energy, Utilities, and Technology Committee on Thursday, February 5th, and the briefing concluded yesterday. The plan recommends the state adopt an overall policy of lowering energy costs and reducing pollution, and makes numerous specific recommendations consistent with that overarching policy. Some of the specific recommendations outlined in the plan are: for the state to pursue a regional solution to natural gas capacity constraints; to increase resources available for residents to lower their heating costs; to consolidate the state’s renewable energy policies, to improve their cost-effectiveness; and to adopt consistent definitions for renewable energy to provide certainty to Maine businesses (executive summary here).

Using this week’s average heating oil price ($2.60), and converting to a common heating unit value (million Btu), the price of fuel oil is $18.75. This compares with an equivalent heating unit value for natural gas of $19.40 (at $1.94/therm); propane, $29.34 (at $2.68/gallon); kerosene $23.26 (at $3.14/gallon); wood pellets, $15.33 (at $253/ton); cord wood, $12.95 (at $285/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 February 9, 2015


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

2.60

2.52

2.69

2.61

2.57

2.65

High

2.99

2.99

2.80

2.79

2.80

2.70

Low

2.35

2.35

2.60

2.45

2.35

2.60

Kerosene

3.14

3.17

3.18

3.08

3.14

3.06

Propane

2.68

2.72

2.72

2.63

2.73

2.56

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 ($2.99) was found in one region in the state, and the lowest heating oil price ($2.35) was recorded in two 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