Reactions to Rising U.S. Utility Costs

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Key Takeaways

• 77% of Americans saw their utility costs rise in the last year.
• 91% have made budget cuts to combat increased utility costs.
• 9 in 10 Northeasterners said rising utility costs have caused them financial stress.
• The most common energy-saving practices Americans are using to combat higher utility bills are turning lights off when not in use, unplugging things when not in use, and investing in energy-efficient appliances.

What Utility Price Spikes Mean for Americans

Utilities are incredibly expensive today, and residents are feeling the pressure. To see how these rising costs are affecting the average American household, we surveyed more than 1,000 people about it and the sacrifices they’re making to pay their utility bills. Keep reading to find out how they differ across regions, generations, and even political parties.

Utility Cost Increases and Related Stress

We started by asking participants which of their utility costs have increased. They also shared how stressed they felt about it and their thoughts on how the government should respond.

Most American households are likely feeling the strain of rising utility costs. In 2022, the cost of electricity increased more than 15%, which explains why 76% of those we surveyed have noticed higher electric bills.

Many of the 77% who noticed an overall rise in utility costs were residents of the Northeast. This region has also experienced a consumer price index increase of nearly 5% on non-food and non-energy items in the past year (compared to just over 2% for the rest of the U.S.). So, it’s no wonder only 1 in 10 Northeastern respondents had no concerns about being able to afford their utility bills this winter.

Because of these problems, New England governors have sought a waiver to a century-old policy known as The Jones Act. Originally intended to boost the economy after World War I, this act prohibits foreign-made ships from transporting cargo between domestic ports. Because most cargo ships that transport oil and gas are produced abroad, this severely limits U.S. access to oil and increases the price of domestic utilities.

In the meantime, Republicans and Democrats were equally likely to say they’d apply for government assistance to help them afford the increased cost of living. Although only 4% of respondents have sought utility assistance from the government so far, 8 in 10 said they’d accept it if they were eligible.

Those in the Northeast were most interested in getting help through the Low Income Home Energy Assistance Program (LIHEAP). Meanwhile, Americans in the South were the least likely to be stressed about utility costs. But a warmer climate doesn’t always mean lower energy bills; these price spikes are even likely to hit sunny Florida this year.

Actions Taken To Fight Utility Costs

Even before utility costs skyrocketed, inflation had already put massive pressure on many Americans’ budgets. The next part of our study looks at the actions taken and spending cuts made by the average household in response to this new reality.

Household budget cuts are sweeping the nation: 91% of the Americans we surveyed have cut back on spending to afford rising utility costs. The majority (62%) spent less on entertainment, while 45% slashed their grocery budgets in order to have enough to pay their utility bills. This measure was taken by more than half of the Northeasterners we surveyed (54%). It’s easy to understand why since many of these respondents reported worrying about affording their utilities this winter.

Meal planning is another common way to save on groceries, which 28% of our respondents have tried. But this might be easier for people without children, as we found they were 11% more likely to plan their meals than respondents who were parents. Non-parents were also 19% more likely to stick to a grocery list when shopping.

Caring for kids comes with struggles and time demands that may make it harder for parents to plan ahead for meal time. Parents surveyed were also 35% more likely than others to take on additional work to afford their utility bills, compared to 25% of Americans overall. Extra work was very common among Gen X respondents, and they were 43% more likely than millennials to have a second job or work longer hours.

To save money for utility costs, Americans surveyed also said they’ve shopped smarter (i.e., looked for sales/used coupons) and reduced their subscription costs. The most commonly cut video streaming service was Netflix, possibly due to its history of increasing subscription prices. As for music streaming platforms, Americans surveyed were most likely to drop their Amazon Music subscriptions to afford energy expenses.

Interestingly, increased energy costs led to some environmental wins in our respondents’ homes. Many Americans have been reducing energy consumption and spending by turning off lights (70%) and unplugging things (54%) when not in use. Almost half (45%) have invested in energy-efficient appliances, which can save about $100 per year per appliance. And even though only 25% of respondents reported lowering their water heater temperatures, doing so can help save over $400 annually and also provide some health benefits.

Certain energy-conserving habits are more accessible than others. For example, it’s easier for those who work outside the home to lower their thermostat during work hours to reduce their energy use. That may explain why we found that on-site workers were 78% more likely to limit their heat use in winter and 9% less likely to feel financial stress due to high utility costs. With so many people working from home, this could also be part of the reason why more people are struggling to pay their energy bills today.

There’s Still Hope

Most Americans seem to be experiencing utility-related financial stress. But the action steps many have already taken show both a resiliency in spirit and hope for the environment, with more people turning off lights and unplugging electronics when not in use, and even investing in energy-smart appliances. While the circumstances for these changes are challenging, these cost-saving measures may lead to an increase in energy-conserving habits nationwide.

Methodology

To determine how Americans are coping with increased utility costs, 1,000 individuals were surveyed.

About Payless Power

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Fair Use Statement

Rising utility costs are affecting our families, friends, and neighbors. If someone you know may benefit from the research presented here, please share it. Just be sure your purposes are non-commercial and that you provide a link to this page.

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