Energy Bill Insights
Major Energy is committed to providing thoughtful customer service and predictable fixed plans for customers that value transparency. As your trusted energy partner we provide resourceful information that helps customers make informed utility decisions. Most customers are painfully aware of the record-breaking energy prices of Summer 2022. Winter 2022 is expected to see similar volatility.
You may be wondering: How can we manage our usage better? Who controls the price? Why is it increasing, and can we ever expect relief?
How usage effects energy bills
– Household size and time spent at home
Spending more time at home, welcoming a new roommate or an increase in guests during the holidays will most likely affect your household energy usage. Take the opportunity to plan events outdoors and try to remember to conserve, when possible, indoors. Simple things like using natural light, energy-efficient appliances, remembering to turn off the lights when leaving a room or selecting to cookout on the grill can drastically impact your energy bills.
– Freezing cold winters. Scorching hot summers.
Extreme temperatures have often resulted in increased energy usage. Air conditioning units and heating units see large increases in use depending on the season/weather conditions. Climate control may account for up to 25% of household energy costs. Use your ceiling and standing fans to reduce consumption.
– Energy vampires and idle appliances
Identify areas of waste. Major Energy customers can drastically reduce bills by eliminating waste.
- Use a smart thermostat to regulate air-condition settings
- Unplug idle appliances and electronics (televisions, microwaves, computers, printers etc.) or set them to “hibernate” mode
- Swap inefficient light bulbs for longer-lasting, more efficient LED bulbs
- Ensure adequate insulation in the attic.
- Adjust hot water temperature settings that are too high.
- Conserve hot water use and regulate pressure.
Who controls the price?
While wholesale energy prices are set by free market dynamics, retail prices – what you pay, are set by suppliers competing for your business. During this period of high inflation, make sure your current plan works for you and your household.
- Consider your current rate, are you eligible for a fixed option?
- What term length works best for your energy use and budget?
- Does Major offer a plan that protects above-average energy users?
- Are you moving soon? A short-term plan might be best.
Why have energy prices increased?
Most homes in the markets we serve are cooled using electricity and heated using electric heat or natural gas. Regardless of the energy used, the prices of both commodities are dependent on the price of natural gas. Believe it or not, natural gas is the main fuel used to generate electricity (coal is the 2nd).
- The average price of Natural gas was $6.71 per BTU in 2022 compared to $3.90 in 2021.
- Increased global natural gas demand while having historically low inventories are inflating energy prices.
- Natural gas is susceptible to supply chain challenges just like your favorite online retailer. Lack of storage and natural gas transportation capacity add to market pressure. Geo-political issues such as the conflict in Ukraine, Euro zone policy toward Russia and Chinese energy consumption are all upsetting the previous status quo of the natural gas markets.
Volatilities in commodities markets can last some time. It will become increasingly important for customers to become more active in their own energy management.
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Reference: EIA (2022) Natural Gas. Available at: https://www.eia.gov (Accessed: 31 October 2022).