A woman adjusts the thermostat in her home.

(The Center Square) – Hurricanes, refinery fires, record inflation, and the threat of a global recession are combining to promise a winter of economic discontent for many Michigan families.

The Farmers’ Almanac predicts the winter of 2022-23 will be extraordinarily snowy and cold.

“[T]he real shivers might send people in the Great Lakes areas, Northeast, and North Central regions hibernating. According to the Almanac, the North Central States are forecast to experience extremely cold temperatures, (possibly 40° below zero!) especially during mid-January,” the Almanac warns.

It’s doubtful many Michigan homes will be able to dial back the thermostat to much effect if the Almanac’s predictions become reality. As a result, home-heating costs can be expected to skyrocket, which will add further economic pain to household budgets.

Michigan’s economic recovery from the COVID-19 pandemic "has been weaker than the national average,” the Mackinac Center’s Fiscal Policy Director James Hohman told The Center Square. “And it’s likely going to be less resilient against the economic risks that so many people are worried about.”

The National Energy Assistance Directors Association estimates average home-heating costs could jump 17.2% over last winter, costing households an extra $1,025 to $1,202 more than the previous year. The NEADA also noted home-energy costs are expected to jump 35% by 2023 from 2020 levels, which are the highest prices in more than a decade. Added to that financial pain for residential consumers is the average 7.5% increase already experienced on monthly electricity bills.

Chris Douglas, economics professor at the University of Michigan-Flint, told The Center Square in an email that Michigan residents should prepare for home-heating costs doubling this winter over last winter.

“I saw the price of gasoline shoot up to $4.19 per gallon in Burton when driving to campus earlier this week, which will translate into higher home heating oil prices,” he said. “Like with gasoline, the price of home heating oil is up by about $1 per gallon compared to the same time last year. The price of natural gas has roughly doubled since the same time last year. Natural gas was running about $4 per million BTUs last year compared to $8 per million BTUs this year.”

Douglas continued, “A typical household furnace might kick-out 80,000 BTUs of heat per hour. This means the furnace would cost 32 cents per-hour to run, or $230 per month. At $8 per million BTUs, the cost doubles to $460.”

Douglas noted the home-heating situation is much worse in Europe, where the price of natural gas is $51 per million BTUs, meaning it would cost nearly $3,000 to run a furnace for a month.

“The disruption (sabotage?) to the Nordstream pipelines that occurred this week will further increase this price,” Douglas wrote. “The U.S. is insulated from this in the sense that we produce our own natural gas. However, there will be a push to make up the shortfall of Russian gas in Europe by exporting liquified natural gas to them, which will further increase the price of natural gas at home. In short, consumers should expect a significantly higher energy bill this winter unless the supply disruptions somehow reverse themselves before then.”

Regional Editor

Bruce Walker is a regional editor at The Center Square. He previously worked as editor at the Mackinac Center for Public Policy’s MichiganScience magazine and The Heartland Institute’s InfoTech & Telecom News.