As we move into winter, Americans who are about to start heating their homes will experience dramatic price shocks. This winter, heating costs for the typical household will exceed $976. That’s a whopping 7.6% increase over last year. Indeed, over 100 investor-owned and publicly-owned gas and electric utility companies have already enacted or requested climbing rates this year and next. This unexpected increase in costs impacts at least 81 million customers of electric utilities and approximately 28 million customers of natural gas utilities.
Winter heating costs, in general, had been stable before 2021. Since the introduction of that Plan, electric and natural gas prices have soared, increasing by 31% and close to 27%, respectively. Overall, the trend means a worrisome move toward less affordable heating for lots of households nationwide.
In areas where homes mostly use electricity as a main source of heat, the outlook seems especially bleak. As many as 56 million households, especially in the southern US, are about to be hit by skyrocketing electric heating bills this winter. They should expect to pay, on average, 10.2% more in increased costs, increasing their overall costs to just over $1,205. The South in particular expects a shocking increase of over 21% for electric heating.
Consumers can expect a little good news this winter. Heating oil prices are expected to drop 4% on average, reducing the cost to $1,455. At the same time, propane prices are expected to decrease by 5%, which would reduce them to $1,250. This would help the roughly 11 million households that still heat their homes primarily with these fuels.
Natural gas consumers are about to get hit hard, though. They are looking at an average bill of $693, which is an 8.4% jump. The increasing costs have raised alarm among those who administer utility assistance programs. In Delaware, the LIHEAP program is bracing for a surge in requests for assistance. This develops after they experienced higher-than-anticipated need through the summer.
“We are already hundreds of applications in, and the season hasn’t even started yet,” – Sofya Mirvis
Mark Wolfe, executive director of the National Energy Assistance Directors’ Association, touched on the daunting winter that awaits so many Americans. He noted that federal assistance funding— $4 million— has flatlined the last two years. This stagnation has limited advocacy outreach capabilities and lessened assistance to the households that need it most.
“What I’ve seen is much less outreach going on because they don’t have enough money to serve the population that’s coming in,” – Mark Wolfe
Given the uncertainty in these myriad challenges, industry experts are warning consumers to brace themselves for a new reality when it comes to their heating bill.
“Customers should be prepared for this being a new normal,” – Mark Wolfe
Her current predicament serves as a sobering illustration of what increased energy costs would mean for the daily lives of tens of millions of Americans. Our winter heating costs are sure to soar as well. Households need to find other solutions or reallocations in their budget to address this growing crisis.