How high heating costs will shoot up still hard to determine
Published 2:12 pm Wednesday, October 12, 2005
By Staff
Although there is really no way to tell now just how cold or warm the winter will be in 2005 and 2006, one thing is certain - heating costs are going to rise substantially before December.
But just how much is hard to tell, said Tim Lubbers, director of marketing and corporate communications for SEMCO Energy, which provides gas to homes in Niles and surrounding Michigan towns.
Lubbers said the gas price crisis was brought on by the devastation from Hurricanes Katrina and Rita in Gulf Coast towns that produce gas for home and commercial heating.
But even before that, demand from consumers for gas was outstripping supply, causing prices to rise.
The hurricanes caused a problem that already existed to very quickly escalate into an energy crisis, he said.
Other experts in the energy field echo Lubbers' warnings.
He said prices for electricity and natural gas could increase by double-digit percentages over 2004 rates if rate increases are granted.
Lubbers said SEMCO has submitted a request to the Michigan Public Service Commission for a 35- percent increase in its rates.
He said the gas company expects to hear something from the PSC in the next couple of months.
Lubbers said SEMCO and other utility companies are not permitted to mark up gas prices higher than what they pay.
SEMCO does profit from gas distribution, however, he said.
Lubbers said federal regulations that prohibit drilling for gas in many areas across the country, like coastal California and Florida, have added to the gas supply problem.
Lubbers urges customers who find themselves unable to pay a high gas bill on time to quickly contact the company to work out payment arrangements or to seek payment assistance. ”They should call SEMCO early enough so they won't get the heat turned off,“; he said. ”There are ways to help and we don't want to turn anyone off.“;