Utility Companies See Slump With Higher Temps Than Last Year

SALISBURY (THE DAILY NEWS) -- During the winter, Nash McMahan, vice president of Tri Gas and Oil, normally hires seasonal workers to help meet the demand of customers who need to heat their homes as temperatures dip into the 20s and 30s.

This year, however, McMahan said the mild temperatures in December and January have reduced orders and deliveries.

"We have seen it on two fronts," McMahan said. "One, we have not had the degree days this year that we historically have and that's created a lack of gallons that we've delivered; and two, people are still in a conservation mode that's economically driven."

While he was still able to hire winter workers, McMahan said they began later than normal and left earlier than they did during colder winters. The lack of sales has also hurt the company's bottom line.

"Our earnings are down based on what our budget was," McMahan said.

Tom Kines, meteorologist with AccuWeather, said the difference in temperature between last winter and this winter is primarily due to the jet stream being farther north.

The change has prevented cooler, Canadian air from coming down into the mid-Atlantic states. Instead, warmer winds from the Gulf of Mexico and Southern U.S. are keeping temperatures on par with spring and fall.

"Temperatures have been between four and four-and-a-half degrees above normal this winter," Kines said. "If you go back to last winter, they were a little bit more than seven degrees below normal -- that's almost a 12-degree difference between the two seasons."

While temperatures have been above normal regionally, Kines said, that trend also extends to much of the United States east of the Rocky Mountains. He also said utility consumers in those areas have been using less energy to heat their homes as temperatures stay several degrees above normal.

"The average utility bill in theory should be about 35 percent less this year than last year's, assuming prices are the same," Kines said.

Oil and propane companies aren't alone in seeing a dip in usage this winter. Utility companies offering heat through electricity have also experienced a dip in usage as temperatures stayed in the 60s at times throughout January.

Delmarva Power has seen a 10.7 percent decrease in electricity usage per customer from December 2010 to December 2011 in Maryland. In Delaware, the utility company said customers, on average, have reduced their consumption by 5 percent during the same time period.

Matt Likovich, spokesman for Delmarva Power, said the decrease is likely tied to the warmer temperatures, but said customers are also trying to save energy.

While the decrease in sales is impacting smaller companies, Likovich said that isn't the case at Delmarva Power.

"Because we experience peaks and valleys anyway in the utility business, over the course of 12 months everything seems to even out," Likovich said. "It's nothing critical as far as our business goes."

Regardless of the higher temperatures and lower thermostats, Alicia Robinson, planning coordinator for Shore Up!, said the organization has seen the same amount of requests for heating assistance this year.

She said while there have not been as many cold spells this year, the number of individuals unemployed or underemployed throughout the Lower Shore who need help to keep the heat on hasn't decreased.

"Even if its been warmer, they might need help because of a lack of income coming in or because of the rising cost of fuels," Robinson said. "We expect that by the end of the season, we would have seen 10,000 people, if not more."

Shore Up! offers two programs for heating assistance, with one going toward individuals who use propane or heating oil and the other assisting those who get heat from electricity.

jshutt@dmg.gannett.com

410-845-4643