Ignoring cost of living misses the true level of energy burden

Abstract

Abstract Energy burden, which measures the percentage of a household's income allocated to energy expenses, is a widely used metric for identifying a form energy or fuel poverty. A blind spot in energy burden calculations is an omission of the cost of living impacts on ability to spend money on energy bills. There has been a significant nationwide increase in housing burden since 1980, especially among renters. Currently, at least half of all renters face financial strain due to housing costs. Our research reveals that excluding housing cost from the energy burden calculation results in the omission of 21% of burdened census regions (2197 out of 10327 under our method) facing financial strain. Furthermore, this approach identifies more regions with household incomes above the national median (about $75,000 in 2022) experiencing energy burden when housing cost is included. These patterns are particularly pronounced in humid and cold regions. Re-thinking energy burden to include housing affordability is critical to reflect the true level of energy poverty.