Americans are expected to spend more money heating their homes this winter than buying holiday gifts, a new study suggests.
The high cost of staying warm indoors despite cold outdoor temperatures comes after an unusually hot summer, which led households to spend more of their budget on cooling costscompared to previous years, according to a report of the National Association of Energy Assistance Directors (NEADA).
On average, home heating spending this winter is expected to increase 8.7% to $941, up from $866 last winter. The increase in costs is attributed in part to expected colder temperatures in the Northeast and Midwest states.
The average new spending on heating costs exceeds the $902 the average household is expected to spend on Christmas presents this year, a study has found. forecast of the National Retail Federation.
What causes the cost of heating a home to increase?
There are different ways to keep homes warm. Families who use electricity to heat their homes are expected to face the biggest increase in costs – more than 14% – bringing the total to $1,189 from $1,040 from mid-November to mid-March , which NEADA considers to be the winter period. .
The price increase is due to the rising costs of updating and maintaining the electricity grid. Additionally, colder weather is expected to lead to increased consumption.
“It’s getting colder and the cost of electricity is increasing as the grid is rebuilt, so we’re seeing both higher prices and greater usage,” NEADA Executive Director Mark Wolfe told CBS MoneyWatch.
Cost differences for natural gas, propane and fuel oil
Natural gas and propane users are also expected to pay higher bills this winter. Natural gas heating costs are up a little more than 3%, for an average cost of $634 for the winter period, compared to $615 for 2023-2024. Costs are expected to increase only modestly, along with wholesale prices.
Propane costs increased 4.4%, with families spending an average of $1,231 to heat their homes, compared to $1,179 last season.
On the other hand, heating oil costs decreased by 2.7%, meaning that average expenses this winter will be $1,518, compared to $1,560 last winter.
Early start to the season
November was colder than usual, with temperatures dropping prematurely after a “very costly summer” of heat waves straining cooling resources, Wolfe said.
Blame climate change for the big temperature swings, he added.
“Weather conditions can be very unpredictable, although over time winters become warmer and summers hotter. It’s not a straight line, and for consumers it’s quite upsetting because utility bills audiences are going to surge right before Christmas,” Wolfe said.
Steps to take now
There are steps consumers can take to limit the costs of heating their home.
Wolfe urges people to get their thermostat repaired now, before the coldest temperatures of the season arrive. This way, families won’t have to pay for an emergency repair if their thermostat breaks in the middle of a cold front. A tune-up will also help heating systems operate more efficiently, he said.
Always close the furnace chimney, or it will conduct heat outside the house, Wolfe advises. Finally, manually turn down the heating at night, if you can, to save up to 10% on your energy bill.
