American households may be facing record-high energy bills this summer, according to a new report from the National Energy Assistance Directors Association (NEADA) and the Center for Energy Poverty and Climate (CEPC).
Their annual Summer Residential Cooling Outlook report predicts that consumers could be hit with their highest bill in at least 12 years, as the average cost of electricity is projected to reach $784 in the coming months—a 6.2 percent increase from last year.
What is causing the spike in energy costs?
The report highlighted two major causes for increasing energy costs—economic inflation and climate change. As the cost of living continues to increase for American families, the cost of electricity is rising even faster than the rate of inflation. Meanwhile, wages have stagnated for many Americans in the workforce, making it difficult for some families to keep up with increasing costs.
In addition to the challenges that come along with the rapidly increasing cost of living, there are also energy costs associated with climate change. As average temperatures rise and record-breaking heatwaves increase in frequency, families use more energy to keep their homes cool and comfortable.
Who will be impacted by rising energy costs?
The effects of climate change and increased energy costs will hit low-income families the hardest. According to the Summer Residential Cooling Outlook report, “The average energy burden for low-income households is about 8.6% of income, almost three times the rate for non-low-income households (3.0%).” In fact, one out of every six households is currently behind on their utilities bill payments—and that number is expected to increase this summer.
In addition to the burden from the rising cost of living, the effects of climate change can also directly impact lower-income communities more than others. Homes may be less equipped for climate control due to older wiring or insufficient insulation. These communities also tend to be less shaded, have less infrastructure investment from their local government, and tend to be in areas that may be more prone to flooding or other environmental disasters.
Regardless of income level, most families across the country will see their energy bills go up in the coming months. Between rising temperatures and the rapidly increasing cost of living, utilities bills will be yet another growing cost for families to absorb until inflation is under control, or until wages go up to compensate for it.
