Once the snow starts swirling and the wind starts howling outside their windows this winter, many Canadian homeowners can take some comfort in knowing they'll be paying less to stay warm.
Outside of Atlantic Canada, where more than half of all homes used oil for heat in 2003 (the most recent figures available), the majority of Canadian households use natural gas.
With the price of that fuel the lowest it's been in seven years, those consumers will notice the difference on their utility bills, said Michael Cleland, president and chief executive officer of the Canadian Gas Association. “At least for the first part of the heating season and probably well into it, what consumers are going to see is a pretty affordable price of natural gas.”
As of the end of September, the average residential natural gas commodity cost was about 45 per cent lower than a year ago, according to the CGA.
And the bargain prices should stick around at least over the first half of the winter, since the prices of consumers' bills tend to lag the spot market for natural gas by a few months. “There's no question that consumers are going to see something this winter that is down from last year, and even more from the year before,” said Mr. Cleland.
The reason for the dirt-cheap heating costs is twofold.
On one hand, enormous supplies of natural gas have been flowing into the North American market, mainly from shale rock formations that until recently were too technically difficult to tap into. At the same time, the recession has dampened demand from industrial users, like manufacturers.
Direct Energy, a natural gas and electricity provider in Canada and the United States, has been able to pass on those savings to customers, said spokeswoman Lynzey MacRae.
But how those changes are reflected depends on whether customers have opted for a variable or fixed price plan, she said. While variable plans “may offer value in a declining market, they do require that consumers pay close attention to changes in market conditions that could trigger increases in their pricing.”
A fixed plan, on the other hand, offers more stability, said Ms. MacRae. “Customers know what price they will pay for the term of their contract, and don't have to deal with the kind of dramatic price fluctuations we've seen over the past year.”
The lower natural gas prices are no doubt welcome, but there are several relatively easy and inexpensive ways for consumers to squeeze more savings out of their home heating costs this winter, said Ken Elsey, president and chief executive officer of the Canadian Energy Efficiency Centre.
“The first thing is, stop air leaks. Caulking is probably the cheapest thing that a consumer can do to save on their heating costs,” he said.
“Look at how you use heat,” Mr. Elsey adds. For instance, Close the heat register in rooms that aren't begin occupied on a regular basis. “It's not rocket science. That's the part that surprises me. It's just trying to change behaviour is the biggest problem that we face.”
A home can lose up to 30 per cent of its heat through poorly fitted windows and doors, said Dave Walton, director of Home Ideas for Direct Energy.
Making sure your furnace's filter is clean could save about 10 per cent on heating costs, Mr. Walton added. “If the furnace filter is clogged, it's going to work that much harder to operate, and in fact could cause premature breakdown of the equipment as well.”
The greatest savings could come from investing a newer, higher efficiency furnace over the long run, but that comes with an up front cost of a few thousand dollars at least.
“Many homes still have furnaces that are upwards of 18, 19, 20 years old. And those furnaces, when they were manufactured, were manufactured to only operate at about 60 per cent efficiency,” Mr. Walton said. “And what that means is 40 cents of every dollar they're spending is going right up the chimney.”
In contrast newer furnaces can be up to 96 per cent efficient.
Mr. Walton also suggests homeowners look into getting an energy audit, in which any potential leaks or other problems can be identified. Any work that results from the audit may be eligible for a provincial or federal rebate. “If homeowners are planning to make any kind of changes to their home... they'd be wise to look into getting an energy audit done.”
