Helping homeowners, businesses and municipal organizations convert to natural gas is both economically viable and environmentally effective. It’s the right thing to do for our state.
Who would argue against an effort that supports stable pricing, environmental progress and energy independence? When Governor Malloy delivered his comprehensive energy strategy for our state, one of the fundamental components of the plan was to provide Connecticut consumers more options in how they heat and manage costs for their homes, schools and businesses. As a part of the energy strategy, the plan calls for gas utilities to make low-cost, domestic natural gas a feasible option for the citizens of Connecticut.
As with many new ideas, there can be obstacles to change, but a true focus on a long-term view can make solutions clear. In response, Connecticut’s three major gas companies –- Yankee Gas, Southern Connecticut Gas and Connecticut Natural Gas -– are working with state and regulatory officials to reduce the upfront costs to customers and make the choice of natural gas a reality.
Why Natural Gas over Fuel Oil?
Because it burns cleaner and more efficiently, natural gas is better for the environment. Natural gas is far cheaper than oil, and all indications suggest that the price advantage remain intact. Large supplies of domestic natural gas will keep prices low for decades to come according to the U.S. Energy Information Administration’s (EIA) latest forecast.
In 2012 alone, the EIA reports that the average annual savings from heating with natural gas instead of fuel oil was $1,800 for residential customers, $3,300 for commercial customers and $25,000 for industrial customers. Add that up over 10 or 20 years, and you’ll quickly realize how serious the savings and economic impact can be.
In addition to lower fuel costs, because natural gas is the cleanest burning of all fossil fuels, natural gas furnaces and boilers are up to 96 percent efficient. Moreover, natural gas boilers maintain high combustion efficiency over time without loss of efficiency due to interior soot build up as a result of burning dirtier fuel oil. Consequently, the availability of natural gas often results in higher resale values of homes.
More than 90 percent of natural gas used in the U.S. comes from North America. And, unlike oil prices which are volatile and still depend on OPEC-driven pricing, Connecticut’s natural gas rates are approved by the state’s Public Utilities Regulatory Authority. If the U.S. can further tap into its natural gas resources, conversion from heating oil to natural gas can reduce our country’s dependency on imported oil and improve the nation’s trade balance.
In addition to energy savings, dollar savings and reduced carbon emissions, the move to natural gas creates jobs in construction, appliance conversion and other related areas. Many prudent fuel oil dealers have recognized this trend and are becoming dual-fuel contractors in growing numbers.
Converting to natural gas also can improve regional competitiveness by attracting or retaining businesses. The state is filled with examples of how a natural gas main extension to a business has helped lower its energy costs and ultimately create or retain in-state jobs.
A natural gas infrastructure build-out will also increase a municipality’s grand list by adding value to properties and by the taxes that gas utilities pay. Further, as total energy costs decline because of conversions, households and businesses will have more disposable income to spend on other goods and services.
Current Progress and Customer Demand
Here in Connecticut, we have converted more than 14,600 residents since January and expect to reach about 17,900 by the end of 2013
Yet the State of Connecticut estimates that only 31 percent of homes here use natural gas, compared with half the homes in Massachusetts and Rhode Island, 72 percent in New Jersey and 53 percent nationally. And while the high cost of energy in Connecticut has stood as one of the greatest impediments to economic growth, the state estimates that just 35 percent of commercial customers and only 50 percent of the industrial sector use natural gas.
There’s no question that many Connecticut residents, town officials and businesses leaders are concerned over the high, unstable and rising cost of fuel oil. And while hundreds of thousands of homes and businesses are poised to take advantage of the abundant supply of cheaper and cleaner natural gas, until now there has not been a comprehensive plan to make this possible.
An unprecedented opportunity is available for the people of Connecticut. A natural gas strategy that allows for more attractive financing mechanisms and cost reduction strategies will improve our state’s competitiveness. It is time to act on a comprehensive energy plan for our state.