Canada:Rise in home heating prices could be 'scary'

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September 13, 2000

Rise in home heating prices could be 'scary' Up to one-third jump: Climb in crude oil, natural gas prices hitting pocketbooks

Carol Howes Financial Post CALGARY - As if higher costs at the gasoline pump and climbing electricity prices aren't enough, many Canadians can expect up to a one-third jump in their home heating bills this winter due to the crude oil and natural gas climb.

"It's scary stuff," said Ron Harper, vice-president of the Atlantic division for the Canadian Petroleum Products Institute. "We can only hope the soothsayers are right about a warm winter."

With oil prices threatening to head toward US$40, the Atlantic provinces, as well as parts of Ontario and Quebec that use home heating oil, are bracing for what could be one of the most expensive winters in years.

At 50" to 54" a litre for furnace oil in the Maritimes, the fuel is already at the same price as its peak last January.

An oil fed home in the Maritimes that would have cost $900 a year to heat 18 months ago, will cost more like $1,650 at current rates.

About half of Canadian homes are heated with natural gas, 35% are heated through electricity and 13% with oil, according to Statistics Canada. The remainder are heated by propane, wood and other sources.

With natural gas prices hovering at $6 per thousand cubic feet -- 60% higher than a year ago -- those who heat with that fuel aren't expected to fare any better.

In Ontario, where natural gas is used by about 70% of households, Enbridge Consumers Gas estimates that owners of a 1,600-square-foot home could pay about $1,440 for the year beginning in October, up about $440 from last year. While in Alberta, for the same-sized home, consumers are looking at roughly $1,100 up from about $845.

"I expect that when people get their first significant gas bill, we're going to hear about it," said Mike Campbell, spokesman for Enbridge Consumers Gas, pointing out that consumers don't realize a rise in the commodity price does not benefit gas companies.

The gas companies, which are in the midst of applying for rate increases, said public relations campaigns are underway; so too are efforts to help consumers conserve energy.

Meanwhile, agencies such as Share The Warmth, an Ontario-based charity that purchases heat and lights for low-income families and seniors, are gearing up for increased demand.

"The impacts are different across the country," said Bruno Carella, vice-president of policy and administration for the Canadian Gas Association.

In Quebec, for instance, where three-quarters of homes are heated by electricity, the old rusty baseboards are starting to look good. Hydro-Quebec's residential rates are frozen until April, 2002.

http://www.nationalpost.com/home/story.html?f=/stories/20000913/397388.html

-- Martin Thompson (mthom1927@aol.com), September 14, 2000


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