Projected Winter Fuel Expenditures by Fuel and Region

The average household winter heating fuel expenditures discussed in this Outlook provide a broad guide to changes compared with last winter, but fuel expenditures for individual households are highly dependent on local weather conditions, market size, the size and energy efficiency of individual homes and their heating equipment, and thermostat settings (see Winter Fuels Outlook table).

Natural Gas

About one-half of U.S. households use natural gas as their primary heating fuel. EIA expects households heating with natural gas to spend an average of $89 (15 percent) more this winter than last winter. The increase in natural gas expenditures represents less than a 1-percent increase in the average U.S. residential price from last winter and a 14-percent increase in consumption. The expected increase in consumption is the result of the forecast of near-normal temperatures this winter, in contrast to the unusually warm winter of 2011-12. The projected changes in residential natural gas prices this winter range from a 3-percent decline in the South to a 4-percent increase in the Northeast. Price changes vary across regions because of a number of factors such as regional changes in production, pipeline supply capacity, and differences in regulatory constraints in passing price changes through to customers.

Heating Oil

EIA expects households heating primarily with heating oil to spend an average of about $407 (19 percent) more this winter than last winter as a result of a 2-percent increase in prices and a 17-percent increase in consumption. About 6 percent of U.S. households depend on heating oil for space heating; however, the Northeast accounts for about 80 percent of these households. Low distillate stocks in the East Coast and Gulf Coast states, which provide over 60 percent of the Northeast's distillate supply, and the state of New York's switchover from higher sulfur heating oil to fuel with less than 15 parts per million sulfur, all contribute to an expected tighter market this winter.

Propane

About 5 percent of total U.S. households heat with propane. EIA expects households heating primarily with propane to spend more this winter, but that increase varies across regions. EIA expects that households in the Midwest will see an average increase in both propane consumption and winter propane expenditures of 17 percent and 11 percent, respectively, with residential propane prices 5 percent lower than last winter. With consumption projected to increase by 16 percent over last winter in the Northeast, households there may see an increase in expenditures of 15 percent with prices lower by an average 1 percent.

Electricity

Households heating primarily with electricity can expect to spend an average of $49 (5 percent) more this winter because of forecasted colder weather despite a projected 2-percent decrease in prices. About 38 percent of all U.S. households rely on electricity as their primary heating fuel, ranging from 14 percent in the Northeast to 62 percent in the South.

Wood

Wood consumption in homes has risen over the past 10 years, reversing a trend seen in the last two decades of the 20th century. In 2009, U.S. households consumed about 0.5 quadrillion Btu (quads) of wood. Household fuel oil consumption, by comparison, was only slightly higher at 0.6 quads. In homes across the United States, wood is most commonly used as a secondary source of heat and is second only to electricity as a supplemental heating fuel. Twenty percent of New England homes (1.1 million) used wood for space heating, water heating, or cooking in 2009 (EIA, Residential Energy Consumption Survey, 2009). This is nearly twice the national rate. Almost half of all rural households used wood in this area of the country. In contrast, only 12 percent of urban New England households used the fuel.