High heating costs cause alarm

-------------------------------------------------------------------------------- Reality of supply and demand sets in for many low-income Americans

By Bill Varner BLOOMBERG NEWS

NEW YORK - Ana Caba began worrying when the first chill winds of autumn sliced through the wood frame around the back door of her house in Brooklyn.

Like millions of Americans, Caba will pay as much as 50 percent more to heat her home with natural gas or oil this winter, according to the U.S. Department of Energy.

As weather across much of the U.S. turns unforgiving, the rising cost of home heating has produced concern and anger.

Caba, who earns about $25,000-a-year operating a licensed day care center out of her home in the Cypress Hills neighborhood, knew that the porous windows and doors of the three-story attached structure would be overmatched by the cold.

``It's hard for me, working by myself and with three of my own kids living here, to pay the bills,'' Caba said during a break as the six children she cares for each day napped.

She sets the thermostat at 80 degrees so the 50-year-old gas boiler will provide enough heat to keep the children comfortable. Even before the onset of winter, her gas bill increased to $200 a month from the $165 she paid when she bought her house two years ago for $105,000.

Caba and other consumers are caught in the reality of supply and demand: gas and oil inventories aren't rising as fast as demand created by anticipation of one of the coldest winters in the past decade. Natural gas for January delivery is at a 10-year high and heating oil prices are 50 percent higher than last December, industry experts said.

The end of the weather pattern that contributed to mild winters in the Northeast will cause more arctic air to flow from Canada than in any winter since the early 1990s, according to the National Oceanic and Atmospheric Administration. The number of what the agency calls ``heating degree days,'' in which the average temperature is below 65 degrees, is forecast to increase 11 percent compared with last year.

The U.S. Department of Energy, city and state agencies and nonprofit groups are prepared to offer income-qualified homeowners more help than last winter. In the New York City area, utilities such as Consolidated Edison Inc. and KeySpan Energy Corp. are offering discounts that will marginally ease the sting.

``Government services responded after last year, which was very hard on low-income people, even though it was a mild winter,'' said David Hepinstall, executive director of the Association for Energy Affordability Inc., which directs federal funds to 23 not-for-profit agencies serving about 10,000 homes in the New York region.

``Last year we had a senior citizen carrying a single light from room to room around her house to conserve energy,'' Hepinstall said. ``People were doing anything to stay warm, using their ovens and sleeping in their clothes.''

After assessing Caba's needs, a Brooklyn agency affiliated with the Association for Energy Affordability installed door and window weather stripping and gave her energy-efficient light bulbs and a new refrigerator. She's applied to the state office of the Home Energy Assistance Program, which directs federal funds to low-income families, for money to buy a new boiler.

Ana Caba looks at her 45-year-old boiler, which has been leaking and making loud noises while running. She received help from the Association for Energy Affordability, which has promised her a replacement boiler. (Daniel Acker/Bloomberg News photo) Caba knows she is fortunate. ``I'm so happy with the people who came because they listened to my problems and helped me,'' she said.

The U.S. Department of Energy increased spending on winterizing programs by 13 percent this year, up to $13.6 million for New York.

Home Energy Assistance Program eligibility was expanded to include 2.2 million New Yorkers, up from 1.7 million. Funding in New York also increased to $209 million from $136 million.

The state Public Service Commission approved price adjustments that will temporarily lower Consolidated Edison gas prices by 8 percent. KeySpan agreed to reduce rates during the heating season by 5 percent, Robert Catell, chairman and chief executive, said. He said the adjustments would make a bad situation slightly more tolerable.

``We know it is still going to be very tough on a lot of people,'' Catell said.

The New York City Department of Housing Preservation and Development said complaints about lack of heat in apartments have increased 16 percent compared with last year.

New York City Mayor Rudolph Giuliani responded by asking the state to suspend the 4 percent tax on home heating oil for the first two months of 2001, which could save the average consumer $50 to $100 this winter and cost New York about $8.3 million. Suspension of the tax on home heating oil requires approval from Gov. George Pataki and the state Legislature.

At the Home Energy Assistance Program office in Manhattan, homeowners said the tax relief couldn't come soon enough.

Yolanda Jefferson complained about the $175-a-month she and her husband, Richard, pay for the oil to heat their three-bedroom Manhattan co-op. The bill has increased $75 in three years.

``I don't mind that we wear sweaters around the house,'' she said. ``I can take that. It's just that the price keeps going up and I don't see what we're getting for it. Why do we keep getting squeezed so these companies can make more money?''

Felicia Marrone, a clothing store clerk and single mother of three young children who owns a home in the Bronx, said she limits the time when she uses heat. ``The only time we put the heat on is in the evening, after we all get home and before we go to bed,'' she said. ``So it's cold all the time. I don't know what we'll do if we don't get some help here.''

Marrone, who said her oil heat bill has gone to $200 a month from $85 a month when she moved into the house two years ago, qualified for assistance.

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-- Martin Thompson (mthom1927@aol.com), December 24, 2000

Answers

Nation: Costs of heating homes way, way up this year

By HOLLY RAMER, Associated Press LOUDON, N.H. (December 24, 2000 2:31 p.m. EST http://www.nandotimes.com) - Ric Winters recently took his children out to cut down a tree. But they didn't decorate the tree for Christmas - they used it for firewood.

Nearly out of heating oil last week, the single father of six grew nervous waiting for the federal assistance he had applied for.

"I didn't have money to buy fuel, so I went out in my yard and cut some trees down," he said. "For the last three weeks, I've used the wood stove."

Predicted increases in heating costs this year are as sharp as the pointy icicles hanging from snow-covered roofs: Heating oil costs nearly 30 percent higher this winter than last, and natural gas prices 40 percent higher, the U.S. Department of Energy estimates.

Less than a week into winter, agencies that help the poor pay for heat are swamped with applications. At the Home Energy Assistance Program office in Buffalo, N.Y., the line often wraps around the building and many people are told to come back later.

"You have to go outside and tell some single mom who took the day off from work to wait outside in the cold that she needs to take another day off next week," said the program's Nicole Williams, whose office sees about 200 people a day. "That's a hard thing to do."

High crude oil prices and low inventories pushed heating oil prices to a nationwide average of $1.56 a gallon toward the end of last week, said Jonathan Cogan of the federal Energy Information Administration. That compares with $1.12 a year ago at this time.

For natural gas customers, the problem is mismatched supply and demand. For the last few years, supply was flat or declined because low prices gave producers little incentive to drill, Cogan said. Meanwhile, demand increased as more utilities turned to natural gas. Wholesale prices that were as low as $2 per thousand cubic foot a year ago are now between $9 and $20.

Drilling is expanding, but it won't help those who are struggling now, especially in places where cold weather arrived faster than usual.

In St. Paul, Minn., single mother of three Collette Moriarity asked for energy assistance for the first time in November, when her furnace broke down. A local agency helped replace the furnace, but she still faces hefty fuel bills.

"This last bill was almost $300. I couldn't believe it! Thank God it's not due until January, or we wouldn't have Christmas," she said. "You shouldn't be nervous to open your mail, but I was nervous."

The Colorado Energy Assistance Foundation had to hire temporary workers to answer phones after the state had its coldest November in 120 years. The stories they hear are heart-wrenching.

"They're giving up medications and cutting into their food budgets," said development director Larry Kinnaird. "It's difficult for the average person to understand."

Even heating with wood is expensive this winter. A salesman at one New Hampshire wood stove shop said some customers are paying $200 for a cord of wood, compared with about $130 last winter.

"Some people seem to think wood would be a lot cheaper," said Natalie Davidson, whose husband owns a logging and firewood company west of Denver. "I think they're trying to find the best deal they can."

Others are dealing the best they can with what they have.

In Toledo, Ohio, Anita Hollingsworth said she and her boyfriend are trying several ways of coping after her natural gas bill quadrupled to $125 last month.

"About the only thing we can do is keep the temperature down, keep the plastic on the windows and keep more blankets on the bed," she said.

The elderly on fixed incomes have been hit especially hard.

Gas bills in Georgia are expected to be up 60 percent this winter, and in Toccoa, Howard and Annie Lou Littlefield turn their heat off as often as they can. Otherwise, they set their thermostat at 68 degrees.

"That's about as low as you can set that," Littlefield said. "I always wear sweaters in the house. But we've got some age on us, and we have to stay warm to keep us from getting a cold."

Juan de Dios Cepeda, 75, worries about the cost of natural gas in Los Angeles, where bills are expected to rise sharply this month.

"I don't know what I'm going to do," he said through a translator as he ate a subsidized lunch at the St. Barnabas Senior Services Center. "I'll have to spend less on clothes, on food. Less, less, less."

After paying a $37 gas bill in November, 84-year-old Catherine Jury of Belvidere, Ill., thought her December bill for $142.87 was a mistake. Jury, a widow, has lived in her house since 1945 and was never so surprised by a bill.

A note on the bill advised residents to contact the Salvation Army if they needed help, but Jury said she probably will turn to her children instead.

"I'm sure there are people who need it in other ways more than I do," she said.

Back in New Hampshire, Winters also was reluctant to ask for help, but felt he had no choice.

"I was brought up to take care of my own business," he said. "But I had to take fuel assistance. There is no other way I could do it."

http://www.nandotimes.com/nation/story/0,1038,500293305-500465858- 503127287-0,00.html

-- Martin Thompson (mthom1927@aol.com), December 24, 2000.

Everyone is waiting and hoping that someone or the government will take care of them. Don't they realize no one is responsible for them but themselves? That's what liberty is all about. Get with the liberty folks! Long with the USA.

-- ruthangell (bar@bpsinet.com), December 24, 2000.