Stay warm and save

Rising fuel prices increasing costs of home heating

By K.O. Jackson

With winter’s first freeze cooling down the area, many people are turning up the thermostats to warm their homes.

However, there are costs associated with heating a residence.

According to the analyst firm, Telvent DTN, since September, heating oil futures have increased 31 percent, and during the same period, natural gas prices have more than doubled.

Furthermore, a recent report from Prenova, an energy-management consulting firm, said the weather throughout the nation has been colder than normal. As a result, the firm predicts — based on current crude-oil prices around $82 a barrel — winter heating oil costs will be 12 percent higher than last year, while natural gas costs will increase as much as 4 percent.

Natural gas heats up 52 percent of U.S. homes, and in the Northeast, heating oil use is the most prevalent, according to Oil Price Information Service.

Heating a home costs dollars and cents, but there are nonsensical heating methods people should avoid to save their lives and property, said Kokomo Fire Chief Pat O’Neill.

A recent Kokomo house fire was sparked when the occupants, who did not have a furnace, used an electric space heater to heat the home. O’Neill said the heater overloaded the house’s electrical system and ignited wiring in the attic.

Although there were no injuries, O’Neill said in severe cold, there are safer methods to heat a home.

“In weather that could be extremely cold for a period of days, it’s critically important to be properly prepared and to do so safely,” said O’Neill, adding residents should have smoke detectors installed on every level of a home.

“Use a space heater with extreme care and inspect heaters for damaged cords. Most home-heating fires involve portable heaters and space heaters, with gas and kerosene heaters accounting for the highest fatality risk. When using portable kerosene heaters, never pour kerosene into the heater while it is lit and know what type of fuel is in the container.

“We’ve had people attempt to heat their homes with open flames from stoves. These flames are dangerous and produce high levels of carbon-monoxide gas. We’ve had people use open flames on frozen pipes. Let a plumber deal with it. These are dangerous acts.”

FROZEN PIPES

During the recent freeze, Mr. Rooter Pluming of Kokomo received numerous calls concerning frozen pipes, said company spokeswoman Sandy Bowman.

When pipes freeze, they expand; when they thaw, pipes return to their normal size, but now there can be cracks in the pipes, said Bowman.

Oftentimes, the cracks aren’t noticed until spring when people are outside watering.

Both problems require a professional, said Bowman.

“We tell people to take precautions during the winter. The pipes should be exposed. They should leave a small trickle of water running and keep [cabinet] doors open,” said Bowman, adding that, depending on the size of a frozen-pipe dilemma, it can cost hundreds to thousands of dollars to fix.

“You have to take precautions to keep pipes from freezing. It can save you money. People want to save a little on an electric bill and not heat these areas, but if your pipes freeze or burst, it will cost you in the long run.”

NOT TOO LATE

Although winter has arrived, cold temperatures can last until early April, as a result, owners of both Slate Mechanical Inc. and Goodrich Quality Mechanical say it’s not too late to have heating systems serviced.

“If they haven’t done it, it’s still not too late,” said Ted Slate, adding since many of the new model of furnaces are electronically lit, homeowners should never attempt to light one.

“The economy is tight,” said Marcus Goodrich, “and people are cutting back and not spending money if they don’t have to, but service is one area you don’t want to cut back on. If you have a home with no heat, that’s going to cost you. You want to have your furnace checked out and tuned up so that it will run efficiently.”

To help consumers with higher energy bills, the Indiana Office of Utility Consumer Counselor recommends consumers participate in an utility’s budget-billing program.

In addition, Anthony Swinger, director of IOUCC’ external affairs, said his company has fact sheets available on natural gas prices and understanding electric rates.

Swinger said the sheets offer information on budget billing and components factoring into monthly energy bills. He adds if consumers are experiencing difficulties paying a utility bill due to financial hardships, there is an IOUCC utility service disconnection fact sheet available as well.

“As Hoosiers try to keep their homes and businesses warm, natural gas and electric bills can be very expensive,” said Swinger. “We have several simple tips consumers can use to reduce their energy use and better manage their heating bills.”

The fact sheets can be located at www.IN.gov/OUCC.

SAVE MONEY BY SPENDING

According to the Internal Revenue Service, homeowners making energy-saving improvements this fall can cut their winter heating bills and lower their tax bill as well.

Jodie Reynolds, IRS Media Relations specialist, said the American Recovery and Reinvestment Act expanded two home energy tax credits: The non-business energy property credit and the residential energy efficient property credit.

In addition to these credits, Indiana offers a state insulation deduction up to $1,000 for qualifying windows and doors made with low-emissivity film.

Reynolds said eligible homeowners can claim both credits when filing their 2009 federal income tax return. Because these are credits, not deductions, Reynolds said they increase a taxpayer's refund or reduce the tax owed.

The non-business credit equals 30 percent of what a homeowner spends on eligible energy-saving improvements, up to a maximum tax credit of $1,500 for the combined 2009 and 2010 tax years.

Reynolds said the cost of certain high-efficiency heating and air-conditioning systems, water heaters and stoves that burn biomass all qualify, along with labor costs for installing these items.

In addition, the cost of energy-efficient windows, skylights, and doors, and certain roofs also qualify for the credit, though the cost of installing these items does not count.

“By spending as little as $5,000 on energy-saving improvements, a homeowner could save as much as $1,500 on their 2009 federal income tax return,” said Reynolds.

The residential credit is designed for “green” homeowners investing in alternative-energy equipment.

The credit equals 30 percent of what a homeowner spends on qualifying property such as solar electric systems, solar hot water heaters, geothermal heat pumps, wind turbines, and fuel-cell property.

Reynolds said generally, labor costs are included when calculating the credit. Furthermore, she added, no cap exists on the amount of credit available except in the case of fuel-cell property.

However, not all energy-efficient improvements qualify for these tax credits. As a result, Reynolds advises homeowners check the manufacturer’s tax-credit certification statement before purchasing or installing any improvements.

• K.O. Jackson is the Kokomo Tribune’s business writer. He can be reached at (765) 854-6739 or via e-mail kirven.jackson@kokomotribune.com

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