The Government Steps in to Help Americans Pay Their Electricity Bills

by | Apr 26, 2023 | Utilities

Reading Time: 3 minutes

Electricity costs have been rising for months, along with inflation. In fact, in 2022 utility bills surged 14.3%, double that of the inflation rate.

Electricity to heat homes is expected to cost 10.2% more this winter compared to last year, or $1,359 for the season, according to the National Energy Assistance Directors’ Association. With 200 million American households behind in payments, the government is trying to help mitigate the costs.

How politicians are handling skyrocketing costs

President Joe Biden’s budget plans to provide more than $13 billion in aid to help low- and moderate-income Americans lower their energy costs. This would include grants to pay electric bills and other incentives to make energy-efficient upgrades to their homes.

“We know that winter heating bills account for the largest share of low-income households’ home energy needs,” an administration official said to MSNBC. “So it is imperative that the funds reach households as efficiently and effectively as possible.”

The bill will help roughly 700,000 homes install weatherization protection, and another 500,000 homes install heat pumps.

“Weatherization is a great way to save hundreds of dollars on energy bills, but unfortunately, aging electrical systems and structural complications keep homes in disrepair locked out of this money-saving benefit,” U.S. Secretary of Energy Jennifer M. Granholm said in a release.

In California, Governor Gavin Newsom has called on federal regulators to investigate the rising costs. California residents face high bills in part because of the cost of transmission and distribution of power, upgrading aging infrastructure, and higher demand driven by economic activity. Other factors that are increasing costs include wildfire prevention, and those costs are being passed to consumers.

The U.S. Energy Information Administration said natural gas consumption, production, and exports broke records in 2022, and prices soared to a 14-year high.

“If we’re going to recognize a climate emergency in California, let’s pay for it through the state budget, not through raising rates. That both hurts poor people and undermines the goal of decarbonization,” Severin Borenstein, faculty director of the Energy Institute at UC Berkeley’s Haas School of Business, told CalMatters.

How Americans can lower their electricity bills

For Americans dealing with high energy costs, first, reach out to your local politicians to see if there are any programs designed for your area to help households pay their utility bills. Next, see if you qualify for any of the federal government programs.

Day-to-day, people can use thermal curtains and ensure no air is leaking from old windows. A home loses 30% of its heat through windows.

Adjusting your thermostat can help, too. Lowering it by 7 to 10 degrees for up to 8 hours can help you save up to 10% on your annual energy bill. Be sure to reduce the heating to the lowest bearable level at night, while you’re out at work, or when you’re away for a more extended period of time.

Meredith Galante

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