Just as Nebraskans endured some of the highest
gasoline prices in
the nation as summer began, many are now preparing for another
seasonal energy price shock.
All natural gas companies serving the state have warned their
customers: the price of natural gas will be a lot higher than
last year and the likelihood of a third warm winter in a row is
The federal government's energy prognosticator, the
Energy Information Administration, is predicting this winter could be the most
expensive since 1985 for those who heat their homes with natural gas. The Energy
Information Administration reported daily spot wellhead prices for natural gas
were averaging $3.50 to $4.50 per thousand cubic feet since June, nearly double
the price of a year ago.
"The historic price patterns disintegrated this summer," Doris Jansky, who
tracks energy trends for the Energy Office said. "One of the givens of the
natural gas industry was a price peak in the coldest part of winter with the
price bottoming out in the summer. That just didn't happen this year. The price
stayed up all summer long." According to industry sources, many natural gas
companies purchase a significant amount of gas in the summer when prices are
cheapest, then store it for use during the winter heating season when prices are
Some of the state's major utilities projected cost increases for the coming
heating season, based on higher costs for natural gas and a return to normal
winter weather patterns:
Metropolitan Utilities District in Omaha: Up 69 percent
KN Energy in central and western Nebraska: Up 50 percent or more
Other companies: Up 50-70 percent
Industry sources said the current price rise had its origins in 1998, when
natural gas prices plunged below $2 for a million British thermal units. A warm
winter exacerbated the falling price. Because of low prices, exploration for new
A Host of Reasons
Elsewhere, the nation's economy was humming and electricity use was surging
along with it. Utilities seeking new ways to meet the growing demand turned to
environmentally cleaner - and cheap - natural gas. Since electricity use peaks
in the summer with air conditioning use, the growth in natural gas use does not
strain supplies during the heating season when natural gas use soars.
Natural gas use by electric utilities has been rising so fast, natural gas
suppliers have been unable to transfer as much gas as normal to storage areas.
According to the Energy Information Administration, injection rates for natural
gas storage is running 20 percent below 1999 levels.
In short, static natural gas supplies ran into a raging demand which
triggered the price explosion.
Propane's High, Too
The state's rural residents, some who use propane for heating, will not
escape the rise in prices either. According to information gathered by the
Energy Office, the price of propane in April had risen more than 28 percent over
prices a year earlier. By August, the Nebraska average price for propane was 83
cents a gallon. Several propane dealers said prices are 45 percent higher than
"Traditionally, the price of propane will peak between early March and middle
April," Jansky said. "However, during extended cold periods when supplies could
become tight, we have seen prices surge."
While propane supplies in the Midwest remain below the normal range for the
period, suppliers believe inventories will be adequate. "During our monitoring
of the industry," Jansky said, "we found suppliers were making a concentrated
effort to fill customers storage tanks to forestall any supply shortages."
Some of the Same
Since propane is both present in natural gas and refined from crude oil, any
increase in the cost of these fuels can be expected to show up in retail propane
A return to seasonal winter temperatures would boost consumption which means
consumers will be paying more to heat their homes. As the winter heating season
draws near, expect propane prices to become more volatile, especially if
What to Do
There are a number of ways to reduce the financial bite on your wallet. "Fall
really is a time when people should begin to prepare their home for winter. Just
as you get your car ready for the first freezing temperatures, you should do the
same for your home," Jansky said. The list of heating bill cutting options she
Contact your natural gas supplier to see if the
utility offers a budget payment plan where one pays a fixed monthly amount
throughout the year. The amount is calculated on the previous year's
Add insulation; R-49 in attics, R-38 in cathedral
ceilings and R-18 in walls e Install or replace worn weatherstripping
Check and replace old caulk
Plug any holes in exterior walls
Other tips on reducing energy use in your home can be found in Energy Savers:
Tips on Saving Energy & Money at Home.
Copies are available from the Energy Office or the information is accessible
on the Internet at Energy Savers
Limited Income Options
If you - or someone you know - has a limited income and experiences
difficulty paying utility bills, contact your local Nebraska Health and Human
Services Office to see if bill paying assistance is available.
Another source is free
weatherization of your home. This federally-funded service has been used by more
than 50,000 Nebraskans since 1978. More information about this service can be
found on page 2, or by contacting Pete Davis in the Energy Office at
People who know say the price of wood used for fuel
will be going up along with other fuels.
According to the Nebraska Forest Service and several firewood
suppliers in Nebraska, consumers should expect to pay more than
$120-$150 which was the cost of a cord of wood last year. Cost
increases are being attributed to increases in other types of fuel.
Generally, wood prices do not change from year to year, but
rather over a five- to ten-year period.
A cord is a standard volume measure for fuelwood. Typically, a
cord of wood measures 4 feet x 4 feet x 8 feet.
Eligibility for the free home improvements
is limited to households with incomes at or below 125
percent of the federal poverty level.
Households containing a member
receiving either Aid to Dependent Children or Supplemental
Security Income are automatically eligible.
For each additional member add $ 3,625
More than 500 homes will see lowered energy bills thanks
to a $1.27 million grant from the U.S. Department of Energy
to make the homes of low-income and elderly Nebraskans
Typically, the types of improvements made to homes
include wall and attic insulation and checking the
energy efficiency and safety of furnaces, stoves
and water heaters.
According to the Energy Office, energy use after home
weatherization falls by about 20 percent. Most of the
improvements made in the home will last 15 to 20 years,
and so will the savings.
Since 1978, more than 50,000 homes in Nebraska have been
made more energy efficient under this federally-funded
Weatherization services are offered in all 93 Nebraska
counties. The Energy Office contracts with nine, nonprofit
community-based organizations, primarily community action
agencies, to provide these services.
For more information about free home weatherization,
contact your local community action agency, or Pete
Davis in the Energy Office at
Nearly every night in May and June, television
were advising viewers where the cheapest gasoline could be found.
It was as if nothing had changed since 1973, when the nation
experienced an earlier oil price shock.
Nebraskans, like most Americans, had become complacent about
energy costs. In July 1999, regular gasoline was selling for
$1.21 a gallon. A year later, the price was $1.75, the fifth
highest in the nation. Further east in Illinois, Michigan and
Wisconsin, the price was over $2 a gallon. Everyone wanted to
A number of petroleum experts made these observations about
Demand for refined petroleum products has been rising.
Refining capacity has not kept pace with growth, requiring
reliance on imported refined products, where possible.
The number of distinct, state-specific or regionally-used
gasolines has increased dramatically.
The price of a barrel of oil rose from $11 in 1998 to more
than $30 in 2000. For each dollar rise in the price of a barrel
of oil, gasoline prices generally rise 2.5 cents.
Refiners have reduced product inventories, and cannot
respond as quickly to market changes such as increased demand.
A new cleaner-burning gasoline used in some of the nation's
smoggiest cities such as Chicago, Milwaukee and Detroit went
on sale June 1. This new gasoline was more difficult to produce.
As a result, supplies of other types of gasoline became scarcer,
causing prices to rise.
By August, the average price of regular gasoline in Nebraska had
dropped to $1.47. However, there were conflicting indicators
regarding the future direction of prices: oil prices hovered
at $34 a barrel, a 10-year price peak, and the American driving
season ends after Labor Day, and gasoline prices typically decline
as demand diminishes.
Some conventional - as well as offbeat -
gas saving tips gleaned from a variety of sources:
Fill-up the gas tank in the morning. Experts at Parade
say a driver will get a little more gasoline per gallon
if the gas tank is filled when temperatures are cooler.
Over time, the extra bit of fuel mounts up.
Use the air conditioner when it makes sense. Running the
air conditioner greatly increases gasoline use. If rolling down
the windows will cool the vehicle off, don't turn on the air
conditioner. On sunny hot days, park the vehicle in a shady spot.
Roll-up the windows. When traveling down the highway, less
energy is expended running the air conditioner than it takes to
overcome the aerodynamic drag from open windows. At speeds less
than 40 miles an hour, especially in town, the reverse is true.
Avoid speeding. Not only will you avoid getting a ticket, but
driving at reduced highway speeds can save fuel. If you
can, keep speed constant by using the cruise control. If
you have a vehicle with an automatic transmission, use
the overdrive setting which shifts the vehicle to a
gas-saving mode around 50 miles an hour.
Buy regular gasoline. A number of drivers purchase premium
gasoline even though their vehicle does not need that much
octane. While high compression or high horsepower vehicles
need premium, most vehicles do not. Savings can add up every
time you fill-up.
Check the trunk. While certain items are essential - a spare
tire, the tire jack and any emergency supplies - other items
can decrease fuel efficiency. Check the trunk and remove any
heavy items that may not be needed.
When idling makes sense. If the engine will be idling for two
to three minutes - waiting at a fast food drive-through, for
example - more fuel will be used than with restarting the
Perform regular maintenance. Changing oil every 3,000 miles
or so is recommended. Changing dirty air and oil filters and
worn spark plugs also improves gas mileage.
While ethanol has captured the headlines as
"the" renewable fuel
alternative to gasoline, other plant-based resources such as
soybeans are also making in-roads into petroleum's dominance.
Earlier this year, the state's Soybean Board released information
that more than one million gallons of soy-blended diesel fuel had
been produced from the state's crops. Since 1990, the Board has
assisted in on-road testing the fuel in state and local trucks and
One of those participating in the tests has been Omaha Public Power
District, which has been using a 20 percent soy and 80 percent diesel
blend in its trucks. According to the utility, about 4,500 gallons
of 100 percent soybean fuel - which will be blended with 18,000
gallons of diesel fuel - will be purchased from an Iowa producer.
Soy oil is also being used and tested by different utilities in
other ways. Two consumer-owned utilities - one in Nebraska and
one in Iowa - are testing a soy-based transformer oil, called
"BioTrans," to replace mineral oil. "This product, will not
only provide environmental and business benefits, but additionally
support our farm economy in Nebraska since we would be purchasing
a soybean-based product, and Nebraska has a lot of acreage planted
in soybeans. This is a natural alliance between public power in
Iowa and Nebraska and the farming community," Bill Mayben, chief
executive officer of Nebraska Public Power District, said.
Bruning Feed and Grain, north of Hebron in southern Nebraska,
has developed a drip oil from soybeans for use in lubricating
center pivot irrigation pumps. But, the oil has proven to be
ideal for aquaculture pumps, as a concrete release agent and
as a dust control for gravel or dirt roads.
For more information about this product, contact Tina
Domeier at 800-232-6623, or visit the web site at
"As the prices of ag commodities have remained low the last
couple of years, farmers know how important it is to find new
markets and new uses for their products. And the fuel market
is proving a natural one for agriculture.
"This is no more evident than in how ethanol has helped corn
producers. Estimates are that the ethanol market adds between
5 and 15 cents to the price of each bushel of corn.
"Perhaps to a lesser degree, the soy fuel can give similar
support to soybean prices."
Scientists from the national laboratories,
crafting America's energy resource options for tomorrow,
recently predicted changes in the energy arena and how they
could affect our lives.
"We're on the cusp of some major, fundamental changes in energy.
In fact, it's already starting," said Steve Millett, forecast manager
for Battelle. The Battelle Memorial Institute is a federal government
contractor operating four of the nation's energy laboratories.
No Jetson Jetmobiles
The group of scientists from the national energy laboratories
identified the top ten most economically impactful energy
innovations by the year 2010 as part of a regular process
to analyze present and future developments in a number of
industries, including energy.
The ten new energy innovations likely to impact the lives
of Americans the most in the next ten years:
A Shifting Energy Industry Structure:
Substantial innovations in the energy industry and its energy
technologies are occurring. Deregulation of the natural gas and
electric utilities will continue, resulting in more competition
and more mergers. Small, independent utilities will decline and
be swept up into the emerging super utilities. Oil companies
will become energy companies, competing in both the mobile and
stationary energy markets. New players, such as automobile
companies, may emerge as formidable influences in the energy
industry. The convergence of the electric, gas, telecommunications
and water industries likely will result in one-stop shopping.
With $2 a gallon gas prices still fresh in the minds of
consumers, the idea of hybrid cars doesn't sound so bad.
Mileage of seventy-miles-per-gallon will create a lot of
converts. The first generation of these vehicles is already
here in a sporty two-seater from Honda. Hybrid vehicles use
smaller, more efficient internal combustion engines and use
power from electric batteries for an extra boost during
acceleration. "U.S. automakers have produced a next-generation
of hybrid concept cars that will pave the way to 80 miles per
gallon, five-passenger sedans," said Tony Schaffhauser of Oak
Ridge National Laboratory. However, while making progress in
the next 10 years, full transition may require decades.
Smart Energy Management Systems:
In the way that computers and the Internet are radically
changing our economy today, they will change energy systems
even more so in the future. Computers, the Internet and Global
Positioning Systems will increase the efficiency of transportation.
They will reduce congestion and traffic delays and be used in
heating, air conditioning, household appliances and business
equipment and play vital roles in efficiency of energy production
and distribution systems such as pipelines, refineries, power
plants and transmission lines.
Distributed Power Generation:
Some experts are saying the current national power grid may
not be able to meet skyrocketing demand. Power grids of this
scale are on the way out. Major blackouts due to storms and
overloading of the grid will become a thing of the past. "People
and businesses are demanding more reliable power sources," said
Bobi Garrett, from the National Renewable Energy Laboratory.
Power may be generated locally for neighborhoods and individual
residences and businesses. This will be done via micro-turbines,
internal combustion engines and fuel cells. There will be an
increased use of natural gas because it is clean, cheap and
Fuel Cells: There has been a lot of
progress in fuel cell technology over the past 10 years,
but much more needs to happen over the coming decade. Fuel
cells will become increasingly popular for transportation
and for portable and stationary power generation over the
next decade. Before being accepted by the public, fuel cells
must be made smaller and cheaper.
Gas to Liquid Conversion: Scientists
predict the development of chemical engineering processes
to transform hydrocarbon compounds from gases to liquids.
This will permit more flexible use and storage of fuels.
One example is the conversion of natural gas to diesel fuel
for transportation. "Gas to liquids technology offers an
exciting, economically attractive opportunity to convert
natural gas from remote locations - which otherwise would
be wasted - into easily transported and inherently clean
fuel," said Denny Stephens, a research scientist for Battelle.
Advanced Batteries: Batteries will continue
a 20-year trend of advancements into the next decade. These
next-generation batteries will be based on lithium polymer
technology and will have about three times as much energy
capability as those currently on the market. These developments
will play a more crucial role as we make the transition to
hybrid and electric vehicles. Consumers will also see better
batteries for laptop computers and cell phones.
Energy Farms: The use of bio-engineered
crops for fuels will be hurried along by the genetic revolution
that permits cultivation of crops to produce fuels such as ethanol.
"We will grow gasoline, so to speak, to lessen our dependence on
imported oil," Millett said.
Solar Energy: We have heard about this
for a long time, and it is still hanging tough. That is because
it is considered the ultimate sustainable energy form. It is also
difficult to capture and store large quantities in a cost-effective
manner. But Battelle experts see substantial improvements over the
Methane Hydrate Crystal Mining: Geologists
have discovered rich deposits of frozen natural gas crystals on
the ocean bottom. "Tapping this reserve would be a quantum leap
in our ability to provide energy for the future. Although some
new government programs are exploring recovery methods and
associated ramifications, there haven't been any commercial
attempts to retrieve this vast reserve," said Gary Brawley,
a Battelle manager. It is expected that this energy source
will emerge in the next decade to add to our natural gas
The Energy Ideas Clearinghouse provides centralized access to
comprehensive and objective information, education, resource and
technical assistance for increasing energy efficiency. The experts
at the Clearinghouse have loaded the web site with more than 1,000
resources covering a range of topics from adjustable speed drives
The Clearinghouse is operated by the Washington State University
Cooperative Extension Energy Program and is underwritten by the
Northwest Energy Efficiency Alliance, a nonprofit group of
utilities, government bodies and interest groups.
The Nebraska Energy Office will expedite new loans for
irrigation systems and related improvements in counties where drought
conditions are prevalent.
"The Energy Office has financed 434 agricultural projects totaling
more than $7.4 million in the last ten years," Governor Johanns said.
"A significant number of these projects were irrigation systems or
improvements such as low pressure pivots and replacement motors."
According to the Energy Office, most agricultural projects will
require a technical energy analysis of the project being proposed.
"The one page application is very simple," Jack Osterman from the
Energy Office said. "We only need to know the basics of the project,
how much energy is used and how much energy use will be reduced."
The Governor said the agency would expedite reviews of the energy
analyses and loan applications for irrigation systems because of
the impact of the drought on the state's crops. "These reviews
will be done right away," the Governor said. "Normally, this
review would take a couple of weeks."
Improvements financed with the loans must save enough in energy
costs to recover the cost of the improvement within ten years.
The length of the loan can vary up to the simple payback of the
project and is negotiated with local lenders. Interested Nebraskans
can get loan forms from participating lenders, from the Energy Office
in Lincoln, or at the agency's web site.
No state or federal tax dollars are used for these loans.
Web Site Access Speeds Loans
To find out more about 5% Dollar and Energy Saving Loans
contact any one of the 293 banks, savings and loans or
credit unions in the state that offer the loans.
Information can also be obtained from the Energy Office or
visit the agency's web site at:
Nebraska Energy Office.
Did you know sunlight hitting the earth's surface
in one hour
is enough to supply humankind with enough energy for one year?
This is just one interesting fact students and teachers can learn
at the web site Solar
The goal of Global Solar Partners is to bring together teachers
and students worldwide to share ideas about energy in a sustainable
Among the resources at the site:
Global Solar Exchange Unit. This unit is
designed for students
12 to 16 and older to research aspects of solar energy in their
own communities and then exchange the information and ideas with
other studies around the world. This is a short, focused project,
typically lasting three to six hours.
Plug in the Sun. This classroom activity
study guide is for
students 11 to 16. International educators and solar energy
experts developed Plug in the Sun. This downloadable file
also contain six real-life case studies of photovoltaic
applications from around the world.
Global Solar Partners is a project from the Association for
Science Education with sponsorship from BP Solarex, a unit of
In May, Governor Mike Johanns and representatives
from the state's largest electric utilities announced a
multi-media effort to stymie any effort to change publicly-owned
electric systems in Nebraska.
"If any one of us were to suggest breaking up public
power in this state, I think there would be a war,"
Johanns said. "Publicly-owned power systems continue
to provide a great return on our investment with reliable
The Nebraska Power Association, a group of electric
utilities, will conduct an educational effort to remind
Nebraskans of the benefits of public power. The effort
supports the findings of a three-year study of the state's
A Long, Long Time to Never
The study recommended Nebraska only adopt retail choice
when specific market conditions exist that could benefit
the state's consumers. In response, the 2000 Nebraska
Legislature directed the Nebraska Power Review Board to
monitor developments in the region's electric industry.
The Board must also submit an annual report regarding
the specific conditions that would warrant retail choice
in the state. The Governor said "I can't imagine it in
my lifetime," when asked if the state's electric industry
will be privatized.
Nebraska is unique - it is the only state totally served by a
consumer-owned public power system that delivers electricity as a
nonprofit service. Publicly-owned power guarantees Nebraska
residents enjoy local control with some of the lowest rates in
Nationally, significant change has come to America's electric
industry as a result of the Federal Energy Policy Act, passed by
Congress in 1992. The law established greater competition at the
wholesale level, created open access to electric transmission
lines and fostered retail competition, where customers can choose
their power supplier. Retail choice options are available in about
half of the nation.
However, recent surges in price and power shortages have lead
policymakers in some states where retail choice was available to
reconsider how the industry is structured.
In spite of an annual growth rate of 3.7 percent
from 1988 to
1998, the state's electric industry remained a net exporter,
capable of producing more electricity than Nebraskans needed.
That is just one of many aspects of a federal overview on the
state's changing electric industry.
According to the study, the average price for electricity of
5.3 cents a kilowatthour placed the state ninth lowest when
compared with other states. Nebraskans paid an average of
6.46 cents for electricity used in their homes, while the
state's industries only paid 3.60 cents for the same amount
of power. Commercial users paid 5.45 cents on average for a
similar amount of electricity.
Plants in the state that generate electricity range in age
from 21 years for a petroleum plant to 50 years for some
of the hydroelectric facilities.
Over the ten years covered by the study, the number of separate
electric entities in the state declined from 166 to 162,
reflecting the merger of several rural systems. While the
number of systems declined, the number of retail customers
increased from 786,214 in 1988 to 874,386 in 1998.
The profile of the state's electric industry also includes
amounts of generation and emissions from the power plants
as well as state rankings in these categories.
This profile of the state's electric industry is based
on the Energy Information Administration's 1998 State
The Nebraska Energy Quarterly
asked about 6% Dollar and Energy Saving Loans.
Loan forms may be obtained from
participating lenders or the Energy Office.
Questions and Answers...
5% Dollar and Energy Saving Loans
The Nebraska bank where a borrower conducts
merged with an out-of-state bank. Can the borrower still get a
Dollar and Energy Saving Loan from the new bank?
No. Dollar and Energy Saving Loans may be made only by
Nebraska banks, savings institutions and credit unions.
Once a bank, savings institution or credit union ceases to be a
Nebraska financial institution, loans cannot be made by the
institution. The names and locations of participating lenders
in the state are available from the Energy Office and are also
accessible at the Energy Office web site at
Interest rates have been rising in the past few months. What
is the current interest rate on Dollar and Energy Saving Loans?
The maximum interest rate which participating lenders may charge
on Dollar and Energy Saving Loans is 5%. This interest rate for
loans has been in effect since last year.
Have there been any recent changes in the loan particulars?
The Energy Office made a few changes:
An outdoor combustion air inlet duct or a heat recovery
ventilation system (also known as a heat exchanger), items 16
and 17 on Form 2, can be installed without any other improvements.
Replacement windows and glass doors are now required to have
a minimum whole unit R-Value of 2.86 or more, or a U-Value of
.35 or less (Listed on Form 2).
When installing space cooling or heating equipment, all new
ductwork must be installed with gaskets or mastic in accordance
with manufacturer's installation instructions. Duct tape is not
permitted (Listed on Form 3).
Some borrower maximums have changed:
A single family home maximum eligible loan amount has
increased from $25,000 to $35,000.
Any size business or nonprofit now may borrow up to
$100,000 for improvements.
Commercial and multi-family building owners who sign up
as a voluntary Rebuild Nebraska partner may borrow up to
$150,000 for improvements.
A borrower wanted a home energy rating of his home to identify
energy efficiency improvements that could be made. Who performs
The Energy Office certifies home energy raters under the Nebraska
Home Energy Rating System. You may obtain a listing of certified
home energy raters in Nebraska by contacting the Energy Office.
The borrower would then need to contact raters in their area for
availability and costs. The cost of the rating could be included
in a Dollar and Energy Saving Loan, if used to get a loan for
improvements identified in the rating report.
In accordance with the American Disabilities
Act, the state will provide reasonable
accommodation to persons with disabilities. If
you need reasonable accommodation to participate
in any program or activity listed in this
publication, please contact the Energy Office
at 402-471-2186 to coordinate arrangements.
Upon request, this publication may be available
in alternative formats.
This material was prepared with the support of
the U.S. Department of Energy (DOE) Grant No.
DE-FG47-92CE60410. However, any opinions, findings,
conclusions, or recommendations expressed herein
are those of the author and do not necessarily
reflect the views of DOE.