Cost of Winter Heating Continues to Climb, LIHEAP Purchasing Power Declines to 44.5% of the Cost of Home Heating

EIA’s Feb Winter Fuels Outlook report projects continued increases in the cost of home heating this winter. These numbers are of special concern for those using delivered fuels. As shown in the attached table, the average cost of home heating is projected to increase by 7.5% this winter, with the highest increases for those using propane (36.3%), natural gas (7.6%) followed by electricity (3.9%) and heating oil (3.4%). Even though heating oil shows the lowest overall rate of increase, the price continues to remain high. Rising prices were not fully offset by the increase in funding for FY 2014 (+$169 million) with the average purchasing power declining from 47% of the cost of home heating to 44.5%. This continues a downward trend since FY 2010, when the average LIHEAP grant could purchase about 60.2% of the cost of home heating. This suggests that there will be additional pressure to find resources to help families pay their home energy bills this winter with potentially reduced availability for weatherization as states scramble to help families pay these pressing bills.

Attached are two other tables illustrating the impact of budget cuts between FY 2010 and FY 2014. LIHEAP funding declined between FY 2010 and FY 2013 from $5.1 billion to $3.256 billion and then increased to $3.4 billion for FY 2014. During this period, we are estimating that the number of households served declined from 8.1 million to 6.7 million households.

Mark Wolfe / NEADA / 202-237-5199.