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         Oil prices could cause crisis for Maine homeowners
         By Amy Phalon
         August 06, 2008 6:00 AM

         How high will they go? It's the question everyone is asking these days as crude oil prices climb, the
         average price of heating oil in Maine being $4.42 a gallon as of Tuesday.

         "We are headed for what might be a crisis situation this winter," Town Manager Rob Yandow said at
         a recent selectmen's meeting, during which he discussed the town's intention to develop a program to
         offer heating assistance to households in need.

         According to University of Maine professor of economics Jonathan Rubin, "Eighty percent of Maine's
         homes are heated by oil."

         A large percentage of others are heated by propane, natural gas or kerosene, which are also at record
         prices. The vast majority of Maine households are facing a very expensive winter.

         "This is obviously a very difficult time for consumers," said John Peters, president of Downeast
         Energy and Building Supply, which serves households in York. "It is unprecedented; the speed with
         which it is increasing. It is draining a lot of cash out of the economy."

         While there is no argument that fuel prices have increased rapidly, the reason prices are climbing and
         whether they will fall again is unclear.

         "This is an unprecedented time where even experts don't know what's driving all the forces," Rubin
         said. "There is no consensus on whether or not the price is going to go up or come down."

         This uncertainty is what has Rubin worried.

         "It's going to be hardest on households on fixed and low incomes."

         Downeast Energy, like many other fuel oil companies, offers programs to stabilize payment amounts.

         "We are in the middle of a very busy time," Peters said. "Customers are signing up for price-lock
         programs and budget programs that hopefully make it easier for people."

         He said while local oil companies can't control the price of oil, "we can help bring predictability for
         our customers."

         The Maine Oil Dealers Association has a list of "7 Things a Customer Can Do" to improve the
         efficiency of their oil heat system. Recommendations include tuning up the heating system before the
         season starts and using a programmable thermostat.

         Just these two things, the Maine Oil Dealers Association says, can save up to 5 percent with a small

         Performing maintenance on windows and weatherizing are other energy-conservation steps people
         can take before winter. The full list is available online at

         Consumers will no doubt change their behavior and use less fossil fuel this winter than during

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         previous seasons.

         "In the long run, it's actually a good thing," Rubin said. "In some sense, it's good for the environment."

         While he acknowledged that many Maine households are not in the financial position to completely
         change their heating systems before the cold weather sets in, he sees major changes ahead that may in
         fact benefit Maine's economy.

         "Maine is really well positioned," he said. "Maine has wind, tidal power; these renewable sources are
         more valuable to the extent that oil remains high."

         Another option, even in Maine, is solar.

         "This summer has been crazy," said Patrick Crosscup of Greenleaf Energy, which is based in
         Parsonsfield and serves the greater York region. It has been busy all summer installing solar hot water
         and solar electric systems.

         The savings from solar, Crosscup said, is "more of a payback period," during which lower utility bills
         ultimately add up to the cost of installing a new hot water heater or adding solar electric.

         "There are things people need to open their minds to, alternatives," he said. "The power of the sun is

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