A Severe Winter Means High Energy Bills

The briefing highlights a severe energy affordability crisis in the US, where high fossil fuel prices and rising electricity rates are increasing household bills, with estimated winter increases of 10 percent for electricity and 28 percent for natural gas. It details how this burden disproportionately affects low-income, Black, and Latinx households, often forcing them to choose between energy payments and basic necessities. The document proposes a suite of regulatory solutions, including shutoff moratoriums, arrearage management programs, expanded outreach for the Low-Income Home Energy Assistance Program (LIHEAP), and the implementation of fuel cost-sharing structures to protect ratepayers from volatile fossil fuel prices. Long-term recommendations include adopting totex ratemaking, performance-based regulation, and leveraging Inflation Reduction Act (IRA) funds to transition toward a clean energy system.

• High fossil fuel prices and a cold winter forecast are driving estimated average household energy bill increases of 10 percent for electricity and 28 percent for natural gas.
• Energy insecurity is widespread in the US; a November 2022 Census Bureau survey found 43.4 million households could not pay their energy bill for at least one month in the previous year, and over 20 million households reduced or skipped spending on food or medicine almost every month to pay energy bills, a 25 percent increase from 2021.
• State regulators can implement short-term relief measures, such as shutoff moratoriums to protect vulnerable customers and Arrearage Management Programs (AMPs). A successful AMP in Massachusetts reduced disconnections and saw enrolled low-income customers pay more toward bills than those not enrolled.
• Underutilization of existing assistance is a major issue; RMI analysis shows most states have less than 20 percent participation in the federally funded Low-Income Home Energy Assistance Program (LIHEAP), leaving millions of eligible households without aid.
• Current fuel cost pass-throughs shield utilities from risk while locking customers into volatile prices. Fuel cost-sharing structures, used in Hawaii and Montana, could mitigate this; such structures might have saved US ratepayers at least $2 billion during the pandemic peak.
• Long-term structural improvements include totex ratemaking, performance-based regulation, and the use of Inflation Reduction Act (IRA) tax credits and the Energy Infrastructure Reinvestment Program to transition away from fossil fuel infrastructure.

APA

RMI (2023). A Severe Winter Means High Energy Bills. https://rmi.org/resources/a-severe-winter-means-high-energy-bills/

Chicago

RMI. A Severe Winter Means High Energy Bills. 2023. https://rmi.org/resources/a-severe-winter-means-high-energy-bills/.

Wikipedia

{{cite report |author=RMI |title=A Severe Winter Means High Energy Bills |date=23 January 2023 |url=https://rmi.org/resources/a-severe-winter-means-high-energy-bills/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2023severe, author = {{RMI}}, title = {{A Severe Winter Means High Energy Bills}}, institution = {RMI}, year = {2023}, month = jan, url = {https://rmi.org/resources/a-severe-winter-means-high-energy-bills/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }