Electricity bills are expected to jump 8.5% this summer, with some Southern states seeing even bigger increases, as a hotter-than-usual summer and rising electricity prices combine to hit consumers hard.
The National Energy Assistance Directors Association is warning of sharply higher utility bills, with residents in states like Texas and Arkansas facing particularly high increases. Mark Wolfe, the association’s head, notes that climate scientists predict this could be the hottest summer on record, leading to increased energy usage and higher bills.
Summer Energy Costs
In Texas, for example, residents like Robin Westphal are bracing for higher-priced power bills, with her summer air-conditioning bills already topping $300 a month last year. Westphal, a third-grade math teacher, says she and her husband are cutting corners elsewhere to make ends meet.
In Arkansas, seminary student Matthew Kolb is donating plasma twice a week to help cover his bills, which include about $250 a month for electricity. Kolb says money is tight, even with a full-time job and serving in the Army Reserve, and higher utilities in the summer stretch his budget.
Nationwide, the cost of a kilowatt-hour has risen faster than overall inflation, with a 6% increase in the last year and 39% in the last five years. This, combined with extra-hot weather from El Niño, will keep fans and air conditioners working overtime, driving up energy costs.
Impact on Consumers
The federal government provides some help to low-income families to pay their utility bills, but funding for the program has been flat for the last three years, even as electricity costs have risen sharply. Energy assistance offices are increasingly hearing from middle-income families who are struggling to pay their power bills.
Every year, some 13 million customers in the U.S. fall so far behind on their bills that their power is temporarily cut off. With rising energy costs and increased demand, this number could increase, leaving many consumers struggling to make ends meet.
The rising cost of electricity and expected increase in summer energy bills has broader implications for the economy and consumer spending, as households are forced to allocate more of their budget to essential expenses like energy, rather than discretionary spending.
