business

There was rare good news on the energy front Thursday as major utilities indicated increases on winter heating bills will be less dramatic than they had predicted months ago. Meanwhile, Minnesota will receive nearly twice as much federal money to help low-income residents pay their heating bills through the coming winter.

State officials announced a $144.5 million grant, its share of the $5 billion in a nationwide Low-Income Home Energy Assistance Program (LIHEAP) approved by Congress and signed by the president this week. That's almost double last winter's $78 million grant.

Signals from natural gas markets and at least one of the state's major utilities indicate winter's heating bills are likely to go up about 10 to 15 percent, considerably less than the 30 to 45 percent projected earlier this summer. But assistance agencies are warning that much of the new money will go to cover their clients' past-due bills from last year, with little left for this winter's expenses.

"The new help is a huge relief," said Catherine Fair, director of energy assistance at the Community Action Partnership of Ramsey and Washington Counties. "But, and I hate to say it, it's still not enough."

The federal grants will finance individual grants averaging $500 to Minnesota families who earn less than 50 percent of the state's median income; for a family of four, that figure is $39,414.

"Minnesota can be an awfully cold place in the winter, but no one should go without heat because they've fallen on hard times," Gov. Tim Pawlenty said Thursday in a statement praising the increased allotment.

Minnesota's two biggest utilities also said they're not seeing a big increase in people not paying their bills, partly because bad economic conditions had already shown their effects last year. Home customers now owe CenterPoint Energy, the state's largest gas utility, $43 million, about a 20 percent decrease from the record bad 2007, according to a spokesperson.

At Xcel Energy, a gas and electric utility, home customers are $26.3 million in arrears, roughly comparable to the $25.9 million last year, the company said.

Natural gas prices aren't rising as much as projected earlier this summer, partly because production has grown even faster than demand, said Jeffrey LeMunyon, an Edina-based energy consultant.

Strong need for assistance

Still, Fair's agency has already taken 6,700 applications for LIHEAP help, in advance of the Oct. 15 effective date of Minnesota's Cold Weather Rule, which provides low-income families some protection from disconnection if they fall behind on their utility bills.

The agency's numbers are a 70 percent jump from than this time last year, Fair said.

One of those applications came from Sharlene Johnson, a single mother of four in St. Paul, who had to move her family into her mother's house when Xcel cut off her utilities two months ago.

Johnson, a home care aide, said she owes Xcel $2,000 because she can't afford to pay both her mortgage and her heating bills.

"I hope the grant will help me get my balance down some, so I can start making payments toward the rest," Johnson said.

For a list of agencies administering LIHEAP, go to the Minnesota Department of Commerce website: www.commerce.state.mn.us and click on Heating Assistance, or call: 1-800-657-3710, or 651-296-5175.

H.J. Cummins • 612-673-4671