With a hot summer in full swing, it isn’t just temperatures that are going up. Across America, households are bracing themselves for another season of painful utility bills driven by higher energy costs.
While fuel oil, electricity, and piped gas may have fallen slightly from their 2022 highs, the reality is that many of us are still paying significantly more than just a few years ago.
Of course, due to the nature of the energy market, utility costs will vary from state to state, with the Pacific states of California, Oregon, and Washington facing the highest prices for natural gas.
But for all the regional variances, many middle-class and lower-income households are set to find themselves in the same situation: in search of waves to save on their utility bills and ensure they have another money for other things in life.
To assess what higher utility bills mean for America’s finances, and what households are doing about it, we surveyed 2,000 adults across the US about their experiences. Our study reveals that:
High utility bills hit America’s finances
Perhaps it’s no surprise that hot summers bring higher energy bills. Indeed, the Energy Information Administration estimates that the average household uses 12% of their energy consumption on air conditioning - usually in the summer.
Throw higher energy costs into the mix – a stubborn feature of the post-pandemic global economy – and that can mean a financial headache for the typical family.
Indeed, our study reveals that 75% of households are expecting their utility bills to be higher this summer. And 73% are saying that this will put a strain on their household finances.
That said, it does appear that Americans are gradually adjusting to the reality of higher utility bills, with 51% of respondents saying they have been saving to cover their bills this summer.
Putting money aside isn’t necessarily a bad thing. But it also means cutting back on spending elsewhere – whether that’s making difficult sacrifices on essentials or saying goodbye to leisure activities.
For some Americans, taking care of utility bills means going even further, with 1 in 10 saying they have had to borrow money in order to keep up with their electricity payments.
How American households are cutting back
Asked whether they were cutting back on spending elsewhere in anticipation of higher utility bills, 4 out of 5 respondents confirmed that was the case for them.
The most common thing facing the chop was entertainment, with 32% of respondents saying they were spending less on hobbies and socializing. Similarly, 30% said they were cutting back on hospitality and dining out.
Vacations were another popular option, with 16% saying they were opting for a cheaper getaway, and 20% saying they were canceling their vacation entirely. Meanwhile, 31% were taking a more drastic option by spending less on groceries.
As well as cutting back on spending, households are also trying to use less energy in the first place. So what kind of methods are they using?
Perhaps unsurprisingly, adjusting the AC came top of the list, with 71% saying they'd be tweaking the thermostat to conserve energy. Although given the heat this summer, that might prove easier said than done.
Meanwhile, 59% said they would try to better utilize shades and blinds to keep out the sunlight, and thus the heat, in the first place. And 10% said they’d try to cool down using a very different method: opting for the occasional cold shower rather than running the AC.
Aside from the thermostat, other options for bringing down utility bills this summer included switching to more energy-efficient light bulbs (56%) and other appliances (50%); switching off appliances when they’re not in use (40%); and trying to prepare meals without the stove or oven (22%).
Other respondents were looking to their utility company to help them bring down bills, with 26% saying they wanted to participate in energy-saving programs and incentives run by their suppliers.
Methodology: The data in this report derives from a survey conducted by powersetter.com. The survey was launched in June 2024. In total, 2,000 adults in the US were surveyed, and all respondents took the full survey. All genders, ethnicities and age groups over 18 years old were included in the study.
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