- The Washington Times - Sunday, September 11, 2005

AUBURN, Maine (AP) — Richard F. Smith tried to prepare for high heating oil prices: He applied for home heating assistance, he is ready to seal off three unused rooms, and he has insulated his cellar and electrical outlets.

Despite all that, the 75-year-old expects to dip into his life savings to keep warm this winter, even with federal heating assistance.

“People are concerned but what … can you do?” asked Mr. Smith, who lives alone with his cat, Sam, in a seven-room house built in 1820.

With fuel prices surging because of Hurricane Katrina, there are no guarantees heating oil won’t hit an unprecedented $3 a gallon. Last year’s average of $1.95 per gallon in Maine already was enough to make customers wince.

Officials worry that federal heating assistance for the poor will fall short of what is necessary to keep people warm.

“Three-dollar-a-gallon gasoline is an inconvenience and a hardship. Three-dollar-a-gallon heating oil is life or death,” said Beth Nagusky, director of Maine’s Office of Energy Independence and Security.

A bigger proportion of homes in New England use oil for heat than in any other region of the country because of its older housing stock and the late arrival of access to natural gas to many parts of the region, said Jonathan Cogan of the Energy Information Administration in Washington. The portion of homes using oil ranges from 70 percent in Maine to 39 percent in Massachusetts.

Many residents avoided the sting of high oil prices during last winter’s bitter cold by buying contracts that locked in prices early.

This summer, with prices already high, many people paid about $2 a gallon for contracts for this winter. Then Katrina hit the Gulf Coast, knocking out oil supplies and refineries and sending gasoline prices surging.

Heating oil prices spiked, as well, even though there is a greater supply of heating oil than in the past six or seven years, Ms. Nagusky said.

“It was a good thing for the oil companies. They relish this. It is an excuse, an excuse, to up it,” said Mr. Smith, a widower who used to own a small grocery store, Smitty’s, in Auburn. “There’s no stopping it, and it’s a shame.”

Mr. Smith didn’t buy his oil ahead, partly because he finds lock-in programs confusing.

He paid $1.89 per gallon to top off his 275-gallon tank this summer. Since then, the average price has climbed to about $2.50 a gallon in Maine.

New Hampshire’s average price was $2.67, an increase of 23 percent in a month and 65 percent in a year, said Joe Broyles of the state Office of Energy and Planning.

Mr. Broyles won’t hazard a guess about what oil will cost in the months ahead.

“There is nobody on the planet, or in the galaxy, who has a crystal ball big enough for that,” he said.

Jamie Py of the Maine Oil Dealers Association said people shouldn’t confuse local oil dealers, who buy from big suppliers, with industry giants that have enjoyed record profits. Like homeowners, local dealers are paying drastically more for their oil, he said.

The last resort for people who cannot pay to keep warm is federal heating assistance. Last year, 47,000 Maine households received $24 million in payments, said Dan Simpson of the Maine State Housing Authority. But the average benefit was $480 — not enough to fill a tank at today’s prices.

How much heating aid there will be this winter remains uncertain.

There are not a lot of options. Firewood prices have shot up to roughly $200 a cord in Maine, about $75 more than last year. Natural gas prices are up, too.

In Haverill, Mass., Rocco Pelosi, 78, has piled up firewood in his 1.5-acre back yard. That will help some, along with federal assistance. Without it, he is not sure what he and his wife would do.

“I don’t want to cry on anybody’s shoulder,” he said. “I try to make ends meet. If I didn’t have them to help me, I don’t know what … I’d do.”

Mr. Smith’s backup plan also involves firewood. He has an extra bed set up next to his fireplace, and he will sleep in it if he has to.

“I’ll block off the room with the fireplace. I’ll close it right off,” he said.

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