Home electricity bills forecast to reach a 12-year high this summer
High temperatures projected across the U.S. summer could take a toll on Americans' budgets by driving up the price of keeping homes cool.
Home electricity bills are expected to rise to an average of $784 for the summer period, up more than 6% from $737 in 2024 and marking a 12-year record, according a new analysis from the National Energy Assistance Directors Association (NEADA).
The growing expense comes on the heels of a cold winter that drove up heating costs for many Americans, and as consumers continue to grapple with higher prices on everyday goods. Consumers are also increasingly expressing concerns about how tariffs could affect their day-to-day costs, Gallup polling has found.
"We found that it's going to be another expensive summer for air conditioning because temperatures will stay high, and electricity prices have been rising faster than inflation," energy economist Mark Wolfe, executive director of NEADA, told CBS MoneyWatch.
The anticipated spike in residential electricity costs from June through September is due to the combination of rising cost of electricity, which is outpacing inflation, with higher temperatures, NEADA said. Those trends mean that households are not only expected to pay higher prices for electricity, but will likely consume more of it than they did last summer because of the need for more cooling.
"It's not just temperatures that are going up, but the cost of cooling is going up," Wolfe said. "And when electricity prices go up, they tend to stay high. So even if temperatures moderate, your bill might go up because of the cost of electricity."
Unpaid bills
Energy costs eat up a larger share of low-income families' budgets compared to higher-earners. Low-income households spend roughly 8.6% of their incomes on energy costs, compared to 3% for those that are higher up the income ladder, according to NEADA.
Worryingly, the lowest earners could struggle to afford to keep their homes cool, Wolfe noted. The most recent Census Household Pulse Survey found that 37% of low- and moderate-income households could not afford their energy bills for at least one month between April 2023 and April 2024.
If those households find themselves in a financial crunch this summer, they may opt to turn off their air conditioning, which could pose serious health risks, noted Wolfe.
"Last winter was cold, so they're just getting over paying their heating bills, and are now facing higher summer cooling costs," Wolfe explained. "And while people understand that if you don't use heat in the winter, your pipes will freeze, that won't happen in the summer."
Reluctance to turn on one's air conditioning can have adverse health effects like heat stroke. "While this won't do damage to your building, it will do damage to you," Wolfe said.
Extreme heat and health
Public assistance programs haven't kept pace with the evolving climate, according to Wolfe. "We're having heat waves that are lasting longer, and the systems in place to protect families have not kept up," he said.
This summer's cooling cost forecast should be taken as a sign that state and federal assistance programs require modernization, according to Wolfe. Only 26 states offer summer cooling assistance to help Americans pay their bills. Thirty-three states have no protections in place to prevent utilities company from shutting off customers' access to electricity when they're behind on payments.
Extreme heat is the leading weather-related killer in the United States, according to the National Weather Service.
Wolfe says that taking steps to modernize your home can actually help households save money. For example, adding insulation to your house can help control energy bills.
"Families should start preparing for long-term extreme weather and think about the energy efficiency of their cooling systems," he said.
Texas mom accused of buying ammunition for son who officials say planned school attack
These Republicans voted against the reconciliation bill in House Budget Committee
GOP budget package fails to clear key House committee
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
USA Today
38 minutes ago
- USA Today
Investors react to US attack on Iran nuclear sites
President Donald Trump on Saturday said that a "very successful attack" on three nuclear sites in Iran had been carried out. In a posting on Truth Social, Trump added, "All planes are safely on their way home" and he ended his posting saying, "Now is the time for peace." Following are comments from some financial and corporate analysts: Mark Spindel, CIO, Potomac River Capital, Washington, DC: "I think the markets are going to be initially alarmed and I think oil will open higher. We don't have any damage assessment and that will take some time. Even though he has described this as 'done', we're engaged. What comes next? I think the uncertainty is going to blanket the markets, as now Americans everywhere are going to be exposed. It's going to raise uncertainty and volatility, particularly in oil. "There's plenty of time to deliberate before markets open on Sunday. I'm making arrangements to talk to a few people tomorrow. We'll get an early indication when the dollar opens for trading in New Zealand. This was such a bold action, though, and it's such a big contrast to the comments about negotiating for the next two weeks." Jamie Cox, Managing Partner, Harris Financial Group, Richmond, Virginia: 'Oil is sure to spike on this initial news but will likely level in a few days. With this demonstration of force and total annihilation of its nuclear capabilities, they've lost all of their leverage and will likely hit the escape button to a peace deal." Mark Malek, Chief Investment Officer, Siebert Investment Officer, Siebert Financial, NYC: "I think it's going to be very positive for the stock market. I believe that on Friday if you'd asked me, I would have expected two weeks of volatility with markets trying to analyze every drib and drab of information coming out of the White House and I would have said that it would have been better to make a decision last week. "So this will be reassuring, especially since it seems like a one and done situation and not as if (the US) is seeking a long, drawn out conflict. The biggest risk still out there is the Strait of Hormuz. It could certainly change everything if Iran has the capability to close it." Jack Ablin, Chief Investment Officer of Cresset Capital, Chicago: "This adds a complicated new layer of risk that we'll have to consider and pay attention to... This is definitely going to have an impact on energy prices and potentially on inflation as well." (Reporting by Saeed Azhar, Suzanne McGee. Compiled by Peter Henderson and Vidya Ranganathan)
CNN
2 hours ago
- CNN
Hear from Americans still trying to leave Israel
Commercial airlines have, for days now, halted all flights in and out of Israel due to the ongoing conflict with Iran. CNN spoke to multiple Americans in central Israel who are still struggling to leave the country.
The Hill
4 hours ago
- The Hill
Baby Boomers: 1 in 3 say they'll never sell their home, according to survey
(NewsNation) — Over one-third of baby boomers who own their homes claim they will never sell them, according to a Redfin-commissioned survey. The survey also found that an additional 30% say they will at least hold on to their home for a decade, but are willing to sell. Those who are older (the Silent Generation) are even less likely to sell their homes, with 44.6% saying they never would. Younger homeowners, however, are on the opposite side of the spectrum. 21% of millennials/Gen Zers and 25% of Gen Xers said they would never sell their homes. According to Redfin, these results could reflect the fact that many baby boomers don't have the financial incentive that is typically needed to sell a home. Also, many older homeowners have lived in the same home for a while and prefer to stay where they are. Around 67% of the baby boomers in the study had lived in their homes for at least 16 years. Fifty-five percent of baby boomers said they like their homes and have no reason to move, which is the most common reason they stayed. Other common reasons included: Housing prices are up around 40% since before the COVID-19 pandemic, according to Redfin, with mortgage rates nearing 7%. That's up from around 4% before the pandemic. Currently, 31% of baby boomers said they wouldn't be able to own a home in a neighborhood similar to theirs in today's economy. This reasoning is also making it harder for younger Americans to find homes. 88% of homes owned by Baby Boomers are single-family homes, which also might not be large enough to fit an entire family. Only 5% are condos and 4% are townhomes. An analysis by Redfin in 2024 showed that baby boomers are much more likely to have larger homes, despite most millennials and Gen Z homeowners having minor children living at home, compared to only 4% of Baby Boomers. Redfin Chief Economist Daryl Fairweather said, 'With baby boomers opting to age in place rather than sell, it's challenging for younger buyers to find affordable options that fit their lifestyle. But it's worth noting that even though many older Americans say they're not planning to sell their homes, many are likely to eventually part ways as it becomes harder to live independently and/or keep up with home maintenance.' The study also showed that around 25% of millennials and Gen Zers won't be buying a home anytime soon because they can't afford one where they want to live. Other reasons include: At least supply is up, with nearly 500,000 more home sellers than buyers in the current market, according to Redfin. Redfin economists believe that home prices will decline by 1% by the end of 2025. This survey was commissioned by Redfin and conducted by Ipsos in May. Around 4,000 residents were included in the survey.
