PSC: Brace For Higher Winter Heating Bills

by Rick Howlett on August 5, 2008

The Kentucky Public Service Commission is advising homeowners to prepare for what could be a sharp increase in their heating bills this winter.

PSC spokesperson Andrew Melnykovich says natural gas prices have hit levels not seen since 2005, when supplies were disrupted by hurricanes Katrina and Rita.

But this time it’s not a supply problem that’s driving prices up.  He says analysts point ot the fact that more investors are trying their luck with commodities such as natural gas.

“The underlying market fundamentals aren’t there to explain it. there’s plenty of gas, there’s plenty of gas in storage, there’s no unusual demand spike, no supply disruption that would normally underly this kind of an increase,” Melnykovich said.

This summer the price of natural gas has been about 65 percent higher than a year ago, although prices have begun to fall in recent weeks.   It appears that the cost of home heating will still be higher than in the last two years.

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