U.S. home cooling costs are expected to rise as temperatures rise this summer, and put a strain on household finances.
The Energy Information Administration (EIA) prediction Residential electric bills from June through August are expected to average $173 a month, up about 3 percent from the same period last year. The bureau blames increased electricity consumption during the hot summer months for the expected increase in costs.
Tens of millions of Americans are suffering from severe heat waves in the Southwest, Midwest and other regions, as rising temperatures and other risks linked to climate change have prompted environmental and labor groups to urge the Federal Emergency Management Agency. Apply extreme heat It joins the list of scenarios worthy of being called a catastrophe.
The good news for consumers is that lower natural gas prices are lowering electricity rates across the U.S., likely helping to partially offset some of the increases in utility bills.
“Average U.S. wholesale electricity prices, a proxy for the cost of generating electricity, were relatively high in 2021 and 2022 but have fallen by 30% to 50% in 2023, primarily due to lower natural gas prices,” the EIA said in a statement. “We expect retail prices to decline in the coming months due to lower electricity supply costs.”
About 90 percent of U.S. homes use air conditioners, according to the EIA. Residents of the southern Gulf Coast states, where summer weather tends to be hot and humid, generally rely less on air conditioning and therefore use more electricity than customers in the Pacific Coast states and New England, where the climate is milder.
Where electricity prices are most likely to rise
The EIA predicts that electricity rates in California, Oregon and Washington will rise the sharpest, up 7% from a year ago, while residents of the Mid-Atlantic states could see a 4% increase. In contrast, the agency expects electricity rates in New England to fall 7% from June to August.
In dollar terms, utility customers in New York, Pennsylvania and Washington, D.C., could see their bills rise by up to about $14 a month due to the combined effects of increased electricity consumption and higher rates, according to the Energy Department. In the Pacific region, residential electric bills are expected to rise an average of $11 a month, while across New England, electric bills are expected to fall by $2.
Other groups say cooling costs could be an even bigger issue. Financial burden on familiesAccording to the National Association of Energy Assistance Administrators (NEADA) and the Energy Poverty and Climate Center (CEPC), this figure increased by 8% from June to September.
Prolonged heatwaves can be especially taxing for low-income households: 20% of low-income households don’t have air conditioning, according to the group. And those that do may choose not to use it for fear of not being able to pay the energy bill. But with heatwaves now lasting for days or weeks, alternative ways to cope with the heat are no longer sustainable.
“In less extreme circumstances, families can survive hot days by opening the windows, taking cold showers and hoping it will cool down at night. But when the heat continues for weeks or the air outside is hazardous, opening the windows will only make things worse,” the group said in a recent report. report.