by Brianna Crandall — May 18, 2016 — Owners and property and facilities managers of multifamily residences, particularly those who are working to make the buildings more energy and water efficient, with equitable environments for tenants, may be interested in a new “energy burden” review of 48 major U.S. metropolitan areas that finds that low-income households devote up to three times as much income to energy costs as do other, higher-income households.
The report also finds that African-American and Latino households spend disproportionate amounts of their income on energy and that more energy efficiency measures would help close the gap by at least one-third and free up money for such basics as food and medical care.
The report was issued by the American Council for an Energy-Efficient Economy (ACEEE) and the Energy Efficiency for All (EEFA) coalition, with participation from the National Association for the Advancement of Colored People (NAACP) and Voces Verdes.
Key findings from the report include the following:
- On average, low-income households pay 7.2% of household income on utilities – more than three times the amount that higher income households pay (2.3%).
- Energy burdens were found to be greatest for low-income households in the following 10 major cities: Memphis (13.2% of income), Birmingham (10.9%), Atlanta (10.2%), New Orleans (9.8%), Providence (9.5%), Pittsburgh (9.4%), Dallas (8.8%), Philadelphia (8.8%), Kansas City (8.5%), and Cleveland (8.5%).
- For African-American households, the cities with the greatest energy burdens were: Memphis, Pittsburgh, New Orleans, Kansas City, Birmingham, Milwaukee, St. Louis, Cleveland, Cincinnati, and Atlanta.
- Latino households experience the greatest energy burdens in: Memphis, Providence, Philadelphia, Kansas City, Atlanta, Birmingham, Phoenix, Dallas, Fort Worth, and Detroit.
- If low-income housing stock were brought up to the efficiency level of the average U.S. home, this would eliminate 35% of the average low-income energy burden of low-income households. For African-American and Latino households, 42% and 68% of the excess energy burden, respectively, would be eliminated.
- The five cities with the lowest median energy burdens for all households were San Francisco (1.4%), San Jose (1.8%), Seattle (2.1%), Washington, DC (2.1%), and San Diego (2.3%).
Other key findings include the following:
- The Southeast and Midwest regions had the highest average energy burdens across all groups.
- Overall, low-income households experienced the highest median energy burden (7.2%), followed by African-American households (5.4%), low-income households living in multifamily buildings (5.0%), Latino households (4.1%), and renting households (4.0%).
- In 17 cities — which is more than one-third of the cities studied — a quarter of low-income households experienced an energy burden greater than 14%, substantially higher than the 3.5% median for all households.
- On average, African-American and white households paid similar utility bills, but African-American households experienced a median energy burden 64% greater than white households (5.4% and 3.3%, respectively). Latino households paid lower utility bills, on average, than African-American and white households did, yet they experienced a median energy burden 24% greater than white households (4.1% and 3.3%, respectively).
- Renter households also experienced higher energy burdens (4.0% and 3.3%, respectively). Renters pay almost 20% more per square foot than home owners, indicating that they live in less efficient homes.
- Experiencing high energy burdens can greatly affect the mental and physical health of families by increasing financial stress, cases of asthma, respiratory problems, heart disease, arthritis, and rheumatism. Children and the elderly are most susceptible to these health impacts caused by improperly heated or cooled homes.
- Increasing investment in energy efficiency programs is an underutilized strategy that could complement bill assistance and weatherization programs to help reduce high energy burdens in underserved communities. Suggested approaches include: targeting multifamily buildings with energy efficiency investments; using demographic data in program evaluation; and strengthening low-income targets and goals for utility programs.
- States also could prioritize increasing energy efficiency programs in their plans to comply with the EPA’s Clean Power Plan to limit power plant emissions, and could opt in to the Clean Energy Incentive Program, which offers early credit for efficiency projects in low-income communities during the two years prior to the start of the compliance period.
The “Lifting the High Energy Burdens in America’s Largest Cities: How Energy Efficiency Can Improve Low Income and Underserved Communities” report is available free on the ACEEE Web site with a brief registration.
