Heating Costs: Up, Up And Away

Oscar statuettes are displayed for public viewing at a television studio in New York's Times Square, Monday Feb. 12, 2007. The "Meet the Oscars, New York" displays statuettes that will be presented to winners at a future Academy Awards presentation.
AP Photo/Richard Drew
The cost of keeping the house warm this winter is going through the roof, and the proof is in the mailbox. Americans are getting their first big heating bills of the season, and they are whoppers.

The Energy Department says the price for heating oil averages a $1.55 a gallon, up 10 percent from last January, reports CBS News Correspondent Cynthia Bowers.

And the cost is up even more dramatically this season — by 50 percent from November 2000 through Thursday.

For the more than half of American homes heated with natural gas, the Energy Department predicts the cost this season will be 55 percent higher than last season. Residents who paid $540 to heat a home last season can expect to pay $834 dollars this one.

"If this continues they way it is right now, I don't see people surviving," said Don Mackin, who lives in suburban Chicago. Mackin has already lowered his thermostat because his bill is about to increase dramatically.

A frigid December drove up the demand for natural gas, which was already in short supply. And the problem is not only widespread, it's about to get worse.

The major gas company in Colorado plans a rate hike that could double the average bill. Kansans are already paying twice what they did last year, and were told today to expect another increase of 20 percent. The situation is even worse in Minnesota, where utility bills have jumped 58 percent in the last month, and 115 percent since last year.

"People right now are worried because they've seen prices go up," said Jim Bernstein of the Minnesota Department of Commerce. "They're hitting historic highs."

The pinch is being felt even as far south as Graysville, Ala., where the city-owned utility has raised rates 90 percent since November and cut off gas to delinquent customers.

"Its just a situation we have to face," said Graysville Mayor Wayne Tuggle. "Nothing we can do about it; we have to work our way through it."

Chicago's mayor says his $175 million heating assistance fund is already running low, forcing him to seek federal help so the city can continue providing heat to needy families.

Energy Secretary Bill Richardson promised an extra $20 million in relief, but no immediate remedy.

"We think with natural gas, within a year the situation will be better, but because of the increased demand we're going to go through some tough times," Richardson said.

©MMI Viacom Internet Services Inc., All Rights Reserved