Americans struggling to pay utilities
More Americans had trouble paying for their utilities last winter despite heating costs dropping to prepandemic levels, potentially pointing to a deadly summer for millions, said the nonprofit National Energy Assistance Directors Association.
The average cost of home heating last winter was $836, down from $978 in the prior year and $849 in 2020, said NEADA, which represents state directors of the Low Income Home Energy Assistance Program. Yet, the Household Pulse Survey showed that in March, 19.2% of all families couldn’t pay at least one home energy bill in the past 12 months, up from 16.5% in the prior-year period.
The loss of pandemic-era programs, including the enhanced child tax credit, boosted the number of people struggling to pay even smaller bills, and it could get worse this summer, said Mark Wolfe, NEADA chief.
More than 1 in 6 households (16%, or 21.12 million households) are already behind on energy bills, NEADA said. The national average balance rose to a record $20.3 billion in December from $17.7 billion at the start of 2023.
In March, the percentage of families with children that struggled to pay their energy bills also jumped, to 25.6% from 20.4% a year ago, suggesting “the end of the enhanced child tax credits as well as other pandemic income support programs are having a direct impact on their ability to pay basic expenses,” Wolfe said.
The National Oceanic and Atmospheric Administration forecasts above-normal temperatures for most of the U.S. this summer.
Congress needs to provide additional funding to LIHEAP, which helps eligible low-income households pay for home energy services, Wolfe said.
Congress has only allocated fiscal year 2024 funding of $4.1 billion, or $2 billion less than before.
The new child tax credit isn’t as lucrative as the pandemic-era enhanced credit, but it increases the refundable portion, retroactive to 2023 and through 2025. Low-income families who don’t pay income taxes could get up to $1,800 refunded of the $2,000 perchild credit instead of the current $1,600. The amount would rise to $1,900 in 2024 and $2,000 in 2025.
The Senate didn’t return to work until Monday and the tax season ends April 15, so lawmakers would have to act quickly to approve it. Then, the IRS would begin processing refunds to those who qualified for the new child tax credit in 2023.