We all need to prepare ourselves for higher heating bills this winter. The costs of all forms of heating fuels – electric, natural gas, propane, oil, and kerosene – have increased to record-breaking levels. And, if we have a colder-than-normal winter, customers’ usage (and their bills) most likely will go up.

Why Are Energy Prices Increasing?
Does GUC Benefit from Higher Wholesale Prices?
What Is GUC Doing to Cushion the Impact on its Customers?
What Can Customers Do To Prepare?

Why Are Energy Prices Increasing? Energy prices have been on the rise both nationally and internationally since last winter due to short supply and high demand of natural gas. And lately, the situation has been aggravated because of global market pressures, coupled with the effects of Hurricanes Katrina and Rita on Gulf Coast production and refinery facilities.

“While this is a national problem, GUC recognizes the local implications increased heating costs will have on our customers,” said Ron Elks, Greenville Utilities’ General Manager/CEO. “A variety of factors such as the weather, the energy-efficiency of the home, and the amount of energy people use all play a part in how much an individual customer will pay in heating costs. We can only apply what we know now to give customers our best estimate. If prices don't change, and we have a colder-than-normal winter, utility bills could go up, substantially. We have an obligation to caution our customers and advise them to plan ahead for higher heating bills.”

Does GUC Benefit from Higher Wholesale Prices? It is important to know that GUC purchases natural gas and electricity, and we do not set the wholesale prices of these purchased commodities. They are set by our suppliers, subject to the forces of supply and demand. As our wholesale costs go up, we change our retail pricing only enough to recover our increased costs.

What Is GUC Doing to Cushion the Impact on its Customers? Greenville Utilities is doing all it can to minimize the impact that rising fuel costs will have on customers’ bills. In addition to a number of cost containment measures, for many months we’ve done our part to prepare for the inevitable by securing reliable delivery of natural gas at the best rates possible. And, since 1992, the amount GUC pays for wholesale electric power has increased by more than 18%. By absorbing the majority of these increases, we have saved our customers more than $50 million in potential cost increases. In FY 2005 alone, GUC absorbed $700,000 in wholesale increases.

Gas AdvantageBill
Greenville Utilities provides some price stability through the Gas AdvantageBill Program. The program allows natural gas customers to lock into a guaranteed rate that will not change for 12 months or to put a ceiling on their natural gas rate by choosing the “cap” option.

This is the fifth consecutive year that Greenville Utilities has offered the program and each year participation has increased. The AdvantageBill program is offered on a first come, first serve basis and more than 2,000 customers signed up during the enrollment period (August – September) this year.

LNG
Our liquefied natural gas (LNG) storage facility has proven to reduce costs. Since 1996, Greenville Utilities has used LNG during periods of high demand. In 1997, GUC became the first municipal utility in North Carolina to construct a permanent LNG storage facility. LNG is part of an overall strategy to reduce purchased gas costs, delay system enhancements, and increase gas system reliability.

Beat-the-Peak
We have implemented a variety of cost-saving measures to help offset continuing wholesale electric rate increases. Our residential load management program, Beat-the-Peak, was one of the first in the nation to control the demand component of the cost of power. If you have an electric water heater, central air conditioning unit or heat pump, you may be eligible to save $70 a year on your utility bill by signing up for Beat-the-Peak. Beat-the-Peak participants help us reduce “peaks” and lower the cost of wholesale power for all customers. Call 551-1583 for details.

Our staff also implements system-wide voltage adjustment and coordinates load management activities with a number of industrial customers who actively work with us to further reduce peak usage. We operate diesel-engine peak-shaving generators at 12 industrial and large customer sites to reduce electrical demand during coincident peaking periods. By using these peak-shaving generators during the 12 monthly coincident peak hours, we avoided more than $1,445,656 in electrical demand costs during FY 2005. The participating industries received credits of over $600,000.

As a result of our load management efforts, we have avoided over $36.1 million in annual demand costs over the last five years.

Neighbor to Neighbor
We also encourage our customers to contribute to our Neighbor-to-Neighbor fund, which we established in 2001 to provide funds to residential customers who need temporary help paying their heating bills. The program is fully supported by voluntary donations from GUC customers. Greenville Utilities contributes up to $10,000 per year in matching funds. These funds are administered by the Department of Social Services during the winter months (December – March). Over $78,000 has been donated by customers and GUC since the program’s inception nearly five years ago.

Other Assistance
You may also qualify for GUC’s EqualPay Program, allowing you to spread your utility payments equally over the entire year. With Equal Pay, you can make monthly bills more predictable and spread the cost of higher winter bills throughout the year. Call 752-7166 for details.

GUC will make every effort to work with customers who are having difficulty paying their bills. For information, call 752-7166.

What Can Customers Do To Prepare? Two of the biggest factors in how much of an increase you will see are weather and consumption (how much natural gas, electricity, etc. you use). As temperatures drop, your furnace works harder (and consumes more energy) to keep your home warm. As a result, your usage, and your utility bill, will go up. With increased usage, along with the cost of heating fuels already at record-breaking levels, we could be seeing very high bills this winter.

GUC encourages its customers to get ready for the winter season by making EnerygWise home improvements and taking energy conservation measures. By preparing now, you can help control your usage, and your heating costs. Here are some EnergyWise tips:

• If your home has a heat pump with auxiliary electric heat “strips”, don’t adjust the thermostat daily. Set it at the lowest comfortable setting (The Department of Energy recommends 68 degrees), and don’t adjust the thermostat. Just set it, and forget it.
• In the heating season, set your thermostat for 65-68 degrees. Every degree you lower the thermostat setting can save around 7% (per degree) of the operating costs.
• Check and clean or replace your central heating system’s filter(s) once each month. Keeping clean filters in the system can save as much as 20% of the operating costs, and will increase the life of the system.
• Weatherize your home. Caulking, sealing and weather-stripping around all of your windows, outside doors, or where plumbing, duct work and electrical wiring penetrate exterior walls, floors or ceilings can add up to big savings on your heating bill.
• Check your ducts for air leakage. Look for joints that should be connected but have been separated. Leaky duct work will increase your utility bill significantly.
• Much of the energy used for washing clothes is for heating the water. There are two ways to reduce the amount of energy used for washing clothes – use less water and use cold water. Your clothes will be just as clean as when using warm or hot water and you’ll save money by not heating water to wash clothes.
• Weather-seal window air conditioners for better efficiency. When possible, remove them in the winter and weather seal the window. Or, at least cover the unit to prevent cold air infiltration.
• A central forced-air heating system operates more efficiently if you keep the pathway between the supply and return air vents open and unobstructed. Do not close off rooms which you are not using, and do not close or block off any registers. In a modern heating system, closing vents can damage the unit and increase operating costs.
• Check your ductwork in the attic and/or under the house to be sure it is intact. Separated ductwork causes tremendous energy losses, comfort problems, and will seriously impair indoor air quality.