The Energy Information Administration (EIA) expects the winter 2013-2014 heating season to much like last winter while natural gas prices will be a little higher than last year.
That’s one of the key conclusions in EIA’s Short-Term Energy and Winter Fuels Outlook, which was posted on the EIA website Oct. 8.
Based on National Oceanic and Atmospheric Administration (NOAA) data, EIA expects the winter 2013-2014 heating season forecast to be very close to last winter and the 10-year average. Forecast temperatures are close to last winter with the Northeast about 3% colder and the West 3% warmer.
Winter electric bill forecasts are slightly higher than last winter, EIA said. Electric bills could average 3% higher than last winter in the West and Northeast and 2% higher in the South and Midwest.
The South has a far higher percentage of homes (62%) that use electricity as their primary source of heating fuel, EIA said. The West is a distant second at 19%.
Although natural gas expenditures will come in significantly higher than last winter, they are still lower than the average of the previous five winters (October 2007 through March 2012), EIA said in the report.
Natural gas fueled less than 30% of the electricity generated in New England in 2001, but that figure rose to 52% in 2012.
Increased gas use for power generation has contributed to pipeline transportation constraints in the New England regional natural gas market. The situation usually grows more acute in winter. There were “extreme price spikes” in spot gas and electricity prices during January and February of 2013, EIA said in the report.
EIA statistics people see a 35% probability that the January 2014 Henry Hub natural gas price will exceed $4.00/mmBtu. There is an 11% chance it will exceed $4.50 and a 2% chance it will eclipse $5.00/mmBtu.
Forecast natural gas inventories start this winter about 100 bcf lower than last winter, but 70 bcf above the previous five-year average.
The winter fuel document could be one of the last reports issued by EIA before it starts agency employee furloughs due to the government shutdown. EIA tapped some rainy day funds to continue operating normally for the fisrt week or so of the shutdown but that cushion is about gone, a spokesperson said.