New York (CNN Business)After noticing his electric bills rising earlier this year, Jason Bell opted to go on a budget plan so he could spread the cost over 12 months. He and his husband, Shane, figured that would help them get through the coming winter since their Lake Harmony, Pennsylvania, home is heated by electricity.
It didn't turn out that way. The couple is now paying $472 a month on the budget plan, up from around $290 a month last winter. That prompted Bell to resume his part-time job as a police officer on top of his full-time position as a state dog warden. The increase, combined with rising costs for food and other essentials, has left Bell debating whether to take on another part-time gig.
"The prices of everything have escalated to the point that a part-time job may not be enough to supplement the increases of bills that we have budgeted," said Bell, 41, whose husband works as a certified nursing assistant while studying for his nursing degree.
Jason Bell may have to take on a second part-time job, on top of his full-time position, to afford his heating bills this winter.
Like Bell, many Americans are bracing for the cold reality that they will have to shell out even more to keep their homes warm this winter.
Families are expected to pay an average of 17.2% more for home heat this coming season, compared to last winter, according to the National Energy Assistance Directors Association. That comes on top of a big price increase last winter, bringing the two-year hike to more than 35%.
Those who heat with natural gas are facing the largest spike, with their cost for the winter heating season expected to soar 34.3% to $952, the association said.
The tab for heating oil is expected to jump 12.8% to $2,115. And those whose heat runs on electricity can expect to see a nearly 7% increase to $1,328.
Some people may not realize that heating their homes will be costlier this winter, especially since gasoline prices had been falling for months.
"In a lot of people's minds, gasoline and home energy are the same," said Mark Wolfe, the association's executive director. "The surprise here is that the prices for heating fuels are going to be popping."
High energy prices
Energy prices are on the rise in part because of the repeated heat waves that baked much of the United States this summer. That forced utilities to draw down on their natural gas reserves, which are also used to generate electricity, compounding the strain on inventory levels that were already below historical averages.
Oil prices, which spiked last winter after Russia invaded Ukraine in February, are declining but are still higher than they were last year.
Dan Pfoltzer was paying his landlord $150 a month to cover the cost of oil in the small house he rents in Nassau, New York. But over the summer, knowing that oil prices were up, Pfoltzer increased it to $310 a month so he wouldn't be hit with a big bill over the winter.
"By the time this tank runs out, the money will be there for the next tank," said Pfoltzer, 71, who lives alone and drives a school bus.
Still, the increased cost means that he won't be able to pay all of his other bills, including those stemming from cancer treatment a few years ago. To keep his oil usage as low as possible, he plans to turn down the thermostat a few degrees to 67 and bundle up if he's cold.
On the coast of Maine, Dale Christensen, Sr. and his family are already planning to use electric blankets in their living room and bedrooms this winter in an effort to minimize their heating bills. The 53-year-old is also looking at buying space heaters.
Christensen, a rural mail carrier, is already paying back his landlord for the $900 it cost to fill the oil tank when they moved into their rental house earlier this year. He's expecting to receive a $1,300 bill later this fall to refill it for the start of winter and likely two more after that during the season.
Dale Christensen, Sr. expects his family will have to use electric blankets to keep warm this winter in Maine.
Heat wasn't an issue for the Christensens last winter because they lived in an apartment where it was included, though the couple had to make sure their elderly parents, who are on fixed incomes, stayed warm in their homes.
"Every year, we worry about our parents for the heating costs," he said. "This year is even more stress and strain because, of course, now we have to pay for our heat."
The family has applied for aid from the Low Income Home Energy Assistance Program, known as LIHEAP, to defray part of the cost of their oil bill. But Christensen isn't counting on it until he hears whether they are approved.
Less federal assistance available
Making matters worse is there is far less money in LIHEAP's coffers this year, even though roughly 20 million American households — or 1 in 6 families — are behind on their utility bills.
The American Rescue Plan Act, which Congress approved in March 2021, provided a $4.5 billion boost to the program for this fiscal year, on top of a $3.8 billion regular appropriation. The stimulus money was mainly used to reduce the pandemic-fueled spike in arrears.
Both the House and Senate are looking at providing a $4 billion appropriation for LIHEAP for fiscal 2023, though lawmakers have yet to approve the federal government funding bill for the coming year. The Biden administration has asked for an additional $500 million for LIHEAP on top of what lawmakers are considering, while the energy directors association has called for $5 billion more.
Requests for help have been pouring in, even before the cold weather sets in, state energy directors say.
At this time last year, Energy Services Inc. in Wisconsin was getting a record 300 calls a day to its customer care center. Now, the nonprofit group, the main LIHEAP administrator in the state, is fielding more than 1,000 calls a day. A family of three making up to roughly $52,000 a year is eligible as long as funding is available.
"The need hasn't gone away. It's accelerating at such a rapid pace," said Timothy Bruer, Energy Services' executive director, who noted that his group ran out of LIHEAP crisis assistance money in fiscal 2022 for the first time in three decades. "Keeping the heat and power on, which is a basic necessity, has become an unaffordable luxury for tens of thousands of Wisconsin's most vulnerable, at-risk households."
In Massachusetts, the Worcester Community Action Council typically doesn't start receiving LIHEAP applications until the temperature starts to fall, said Mary Knittle, director of energy sources at the nonprofit group. But this year they've been coming in "fast and furious," she said, noting that first-time applications for the upcoming winter are up 60% compared to this time last year.
Residents are bracing for higher charges. One energy provider in the state just emailed its customers to inform them that electric bills will be an estimated $114 higher each month for average usage, compared to last winter — an increase of 64%, she said. It cited higher electric supply prices as the main reason.
Even those who don't heat with electricity will be affected since it typically takes electricity to run home heating systems.
Martin Silva, Sr. is expecting to pay about 30% more to heat his home this winter.
At the same time, Knittle will have far less money to distribute this winter, though the appropriation hasn't been set yet. Last fiscal year, her agency received $24.6 million in LIHEAP funding, including a $13.9 million boost from the American Rescue Plan that has since been exhausted.
"Anxiety is very, very high," Knittle said, noting that a family of three making roughly $68,500 is eligible for help in Massachusetts.
Martin Silva, Sr. is already hundreds of dollars behind on both his water and electric bills for the Bethlehem, Pennsylvania, home he shares with his wife. He's expecting it will cost around $130 a month for natural gas to heat their drafty, old house, up from roughly $100 last year.
A dump truck driver, Silva hopes to repay his debts by cutting back even more on expenses, including trips to see his ill, elderly parents in New York City twice a month. But the mounting expenses have left him feeling "crushed."
"You can't get ahead, no matter how hard you try," said Silva, 51.
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