Challenge

In 2020, more than one-quarter of all households and 41% of renters in the U.S. experienced energy insecurity. About one in 10 households received a disconnection notice and/or kept their homes at an unsafe temperature in order to save on their energy bills.¹ United Way reports that utility assistance is among the top three needs of those seeking assistance, along with housing and food.² When people have high energy cost burdens and are unable to afford their energy bills, they are forced to make choices—such as forgoing needed medications or skipping meals—that jeopardize their health and well-being. Yet utility bill assistance at the federal and state levels consists of a patchwork of underfunded and uncoordinated programs that are plagued by accessibility issues, leading to low utilization rates of about 16% of eligible households across all assistance programs.³

Policy Solution

Consolidated, adequately funded, accessible utility bill assistance programs would reduce energy insecurity for millions of people, thereby improving health and welfare outcomes. Furthermore, recognizing access to affordable energy as a right and financing utility assistance as an entitlement program would remedy a significant source of hardship for low-income households.

Model Policy Features

• Dedicated, stable funding to assist low- and moderate-income residents (e.g. households with incomes below 200% of the Federal Poverty Level), including renters, to assist those struggling to pay their utility bills.
• Ideally enacted as an entitlement, meaning that those meeting eligibility requirements have a legally-enforceable right to assistance, with funding levels that fluctuate according to the size of the eligible population.
• Reduces participation barriers, such as language access, consolidation of existing programs and/or no-wrong-door approaches, categorical eligibility (whereby participation in other government assistance programs qualifies a household for eligibility in offered programs), simplified applications, no more than annual eligibility recertification, and robust outreach.
• Recognizes the right to cooling, providing equitable access to both heating and cooling assistance.
• Ideally paired with weatherization and energy efficiency programs, thereby lowering the long-term need for bill assistance  and reducing household reliance on fossil fuels. 
• Includes provisions for regular data reporting and public transparency (e.g., public-facing data dashboards, program evaluation, audits to ensure meaningful benefits reach intended populations)

Potential Policy Drawbacks and Pitfalls

• Bill assistance programs alone do not address the root causes of energy affordability.
• Many programs offer seasonal assistance rather than assistance that is available year-round.
• High barriers to participation, such as onerous documentation requirements, low benefit amounts, lack of language access, limited outreach, and insufficient funding result in low utilization rates.

Complementary Policies

Complementary policies that increase the effectiveness of utility bill assistance policies include: 

• Those that provide other means of addressing unaffordable energy costs, including arrearage management programs and debt forgiveness, bill credits, low-income rates, and disconnection protections.
• Those that increase home energy efficiency to reduce demand, including pre-weatherization programs, weatherization, electrification readiness, and efficient residential electrification.