How Will Winter Impact Electric & Natural Gas Rates in New England?
Weather is the most significant impact on the cost of energy during the winter in New England. Although market direction has an impact, it is the weather (especially during the winter months) that make-or-break energy budgets.
The issue is that we compete on the world stage during the winter months for liquefied natural gas because the pipeline infrastructure cannot meet the demand. And what is the price difference in early November? The Henry Hub cost in the US per therm is $0.61 versus $3.60 in Europe. Most may remember that our heating costs were elevated last year, and the expectation is that they will go even higher this winter because the price of oil and natural continued to move towards the North Pole.
Most predict that La Niña is back for the third consecutive year except the Old Farmer’s Almanac. Two years ago in New England, we had a slightly above-average amount of precipitation with above-average temperatures. The following year was the reverse with less precipitation and below-average temperatures.
The good news for New England is that the La Niña effect in Europe shows wet and mild temperatures according to Accuweather. This should keep natural gas at the current levels until the spring. This is what experts are predicting this winter.
Farmer’s Almanac
A cold December and a frigid January might make us in the Northeast shake and shiver. But February will bring milder temperatures that should make winter seem more bearable.
NOAA
The National Oceanic and Atmospheric Administration forecast is the same as last year for New England with an equal chance of seeing above, near, or below normal precipitation but a better chance of a warmer-than-average winter.
AccuWeather
The weather forecasting company is predicting a mild winter with an average snow season for the northeast.
Old Farmer’s Almanac
Calls this winter the ‘A Tale of Two Winters’ with the northeast having a cold and snowy forecast while can expect some drought relief with wet and mild temperatures.
As you can tell, the experts are finding it difficult to predict. So no matter the outcome, we know that it gets cold in New England during the winter. The added uncertainty is the geopolitical events in eastern Europe. Our goal which has proved very fruitful for our customers over the years is to plan for budget certainty in an uncertain environment. Contact us on how we can help!
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