How to save in the 'new era' of cheap natural gas
Sunday's column was about the hoopla over natural gas from shale formations in the Appalachians and other parts of the country. Even if only part of the promise from shale gas bears fruit, natural gas stands to stay affordable -- more affordable than oil heat and gasoline -- for years.
If you have natural-gas heat, think twice before locking in any long-term contracts for gas. Deals out there are OK -- in the 70-cents-per-therm range. But the futures market says gas will be cheaper than this next winter. BGE's commodity gas price has been between 73 cents and 59 cents in recent months. (You pay more for delivery.) Even when the economy starts picking up, natural gas prices are more likely to stay in present ranges than gasoline prices, for example, analysts say. I've always stayed with BGE's standard, monthly floating natural gas price and rarely regretted it.
If you have a choice between an electric water heater and gas, go with the gas. Water tanks use up large amounts of energy. Your best bet is to heat with the kind of energy that looks like it'll be more affordable. Of course, if you have a brand-new electric heater it might not make sense to switch. Even with the cheaper BGE bills it'd take years to earn back what a new heater cost. But if you're in the market for a new heater anyway and have a gas hookup, go with that.
Theoretically you can buy a stock natural-gas car -- the Honda Civic GX. But they seem hard to obtain, and they're not very practical for families. I called around to a couple local dealers, who said they've never sold any to individuals. All the customers for natural-gas cars and trucks are government and corporate fleets. Natural gas works for fleets because the vehicles return daily to corporate HQ, where they can fill up on compressed natural gas for the next day's run. It's tougher on individuals, because there's nowhere to fill up. Published range on the GX is only 250 miles.
But if Boone Pickens gets his way and Washington starts promoting NG vehicles, the technology might improve, and gas stations would start offering NG ports as well as diesel and petrol.
Comments
Jay, WGES' floating natural gas price has consistently been lower than BGE's floating price, so in my opinion there is little reason not to switch to WGES' floating plan:
https://www.wges.com/portal/learn_more.php?offer_id=31105
Posted by: Dave | April 5, 2010 7:01 AM
If your car always returns to your garage at night, you can do what the fleet owners do. You can install a compressor, and home compressors are not all that expensive. The cost advantage for the fuel more than makes up for this cost.
The reason that cars are the last vehicles that would switch to natural gas is space. Their fuel tanks take up way more space than a gasoline tank. OK if you want to lose all your cargo capacity; not otherwise.
This is OK for big trucks or locomotives, and some of these are making the shift. Peterbilt, for example, now has a range of natural gas trucks. Here, too, the cost of the fueling infrastructure is not that large, even though it's clearly larger than for fleet vehicles.
Posted by: gametheoryman | April 5, 2010 12:00 PM