Rising oil prices will push up the costs of heating and electricity inCanadian homes by about $6 billion dollars this year, according to a Scotiabank special report.
Canadian households spent a total of $60 billion on energy costs last year, or about $4,500 per home, the Energizing Household Energy Efficiency report said. That figure is likely to go up to $66 billion in 2011, or about $5,000 per household.
"High energy costs, led by the roughly 40% jump in gasoline and heating fuel prices over the past two years, are taking a toll on consumer confidence, purchasing power and -- ultimately -- spending," said Adrienne Warren, senior economist, Scotia Economics.
The high energy costs will also start taking a toll on Canada's economy because consumers are spending dollars that could otherwise have been spent on other retail purchases, saved or used to pay down debt, it said.
After plunging during the 2008 financial crash, oil prices are on the rise again, pushing up the costs of gas and everyday consumer goods. U.S. oil traded Wednesday at about $93.50 a barrel.
Scotiabank said although the costs of natural gas have come down, energy prices are likely to rise in the long term and consumers should take steps to improve the energy efficiency of their homes.
The 2011 federal budget contained measures to encourage Canadians to save energy. The government committed an additional $400 million over the 2011-12 fiscal year to extend the popular ecoENERGY Retrofit-Homes program, which provides grants to eligible households to offset the cost of energy-efficient upgrades.
Source: Calgary Sun, June 22, 2011. By Sharon Singleton,QMI Agency