Scott Haley, Vice President of Residential Sales & Marketing, answers some of your most common questions about today's energy prices.
Q: Why are oil prices so high?
A. Heating oil prices rise and fall for the same reason gasoline and diesel fuel prices do. World demand for crude oil is high and supply is tight. But there are many intangibles that make prices go up and down like an out-of-control rollercoaster. Things like hurricane threats, pipeline disruptions, or a crisis in an oil rich country. And if that’s not bad enough, there’s the unregulated speculation that’s been going on in the energy markets for years. We’re now seeing the disastrous effects of too many speculators making risky bets on oil prices.
While it’s true that oil prices can and do spike, history shows us that they also fall.
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Q: Is it better to be on a variable price or fixed price plan?
A. Choosing between a variable price and a fixed price is never an easy decision because no one can predict for certain in what direction prices will go. But I can tell you what we’ve learned from trends. In the last 17 years, oil prices have dropped more times than they went up during the winter. That’s why the variable price may be a better way to go.
While a fixed price plan protects you against skyrocketing prices, it doesn’t allow you to take advantage of falling prices like we’re seeing now. When you have a variable price plan, our delivery price changes from day to day, depending on how much it costs us to buy the fuel on that day.
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Q: What's the single-most important thing I can do to reduce my energy costs?
A. The best way to save money is to schedule a heating system tune-up. This not only minimizes repair costs, but it also ensures your system operates at peak efficiency. Our delivery records show customers who get a tune-up each year burn about 10% less fuel than someone who skipped their tune-up. Let’s say you spend about $2,500 to heat your home every year. A tune-up will chop 10% off that amount, which means you just saved $250.
Here’s another way to put extra cash in your pocket. Enroll in our service plan, which not only covers the cost of your tune-up, but also protects you with thousands of dollars worth of repair coverage. If something breaks on your furnace, we’ll come out and fix it and we won’t hand you a bill.
Other things you can do include installing a digital thermostat and caulking windows. For more ideas, visit our energy conservation page.
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Q: My furnace is pretty old but it still runs OK, although I needed a repair last winter. Does it make sense to replace it?
A. The average life span of a furnace is 20 years, so if your furnace is in that range, I would recommend replacing it. Your new furnace will be much more efficient than your old one, which means it will waste less fuel. We’ve tracked the savings of many customers who asked us to install a new furnace. You know how much the average person cut their oil usage? Depending on the weather, it is up to 30 percent! So if you’ve been spending $2,500 to heat your home with an old furnace, a new one could potentially save you $750.
That means your new furnace will pay for itself in just three or four years.
If you’d like a free energy analysis, please call one of our consultants today.
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