Da Techguy's (no longer backup) Blog

Got an oil delivery from my local company Lorden Oil yesterday it was for $2.39 a gal.

Back in August when prices were sky high the offered their annual pre-pay. This year it was $4.64 with a .20 cent a gallon price protection option. I figured that rather than tying up so much money, I’d be better off taking my chances and paying as I go since the price was so high I figured how much higher could it go, plus if it dropped I’d be earning the interest instead of them.

I managed to guess right this year but quite a few people haven’t:

First of all, viewers and readers should know that many customers chose to lock in when prices were higher.

They wanted to protect themselves against prices going up even more, and now they’re stuck with higher bills.

In many cases those customers must honor their contracts, even though it looks like a bad deal

However it is forgotten that your local oil company likely prepaid too:

Harry Hicks, the owner of HL Fuels, said that’s precisely what he did. He understands his customers are in a bind, but, he said, so is he. “For people who are paying $4.60, I already paid over $4 for that fuel when they prepaid,” he said.

In Boston its not just the individual customers that lot their bet this year:

The consortium in the western suburbs, which comprises Brookline, Cambridge, Arlington, Belmont, Lexington, Newton, Waltham, Watertown, Weston, and Winchester, has used the system for more than two decades and says it works: It has tied or beaten the market every year until now.

Last year, those communities locked in a rate less than $2, and watched gleefully as prices rose to more than $4 a gallon. But this year, the sharp decline in prices means a city like Newton, which estimated it would use 905,000 gallons of oil this heating season, may have to spend an extra $1.7 million, based on the current average price.

The real danger is if people decide to start running to the lawyers when nothing crooked is going on. Most years the pre-buy is a good deal, this is the first year I didn’t use it myself and the margins on this stuff isn’t a lot.

When you have the freedom to make choices, sometimes you will make the wrong one.

As the year ends power is finally restored in town but the December 11th storm but as our local paper reports there was one nasty surprise for everyone:

Tim Bean said he lost power for 11 days following the Dec. 11 ice storm, and received a Unitil bill this month that’s about $100 more than his regular charge.

“I had my electricity off for 11 days, I assumed it would be less than usual,” the Westminster Hill Road resident said Monday.

The problem is computer models:

Senior Vice President Unitil George Gantz said the company is using computerized estimates to determine a “couple thousand” customers’ utility bills this month because of power outages in the region. Gantz said the system makes an estimate based on the usage of the last year.

Some customers think turnabout is fair play:

Townsend resident Bruce Goyette said he got a bill for $463 this month, even though he only used $277 worth of power last month and $369 worth in December 2007. He lost power for three days this month.

“I think they could have sent a bill that was approximately what November’s bill was,” Goyette said.

In response, Goyette said he’s going to send Unitil an “estimated payment” of $300.

“A more-than-generous estimate,” he said.

We pay Unitil some of the highest electric rates in the country (I think we’re 3rd). This storm and its aftermath are not covering them with glory.