Operation Fuel releases statewide Energy Affordability Gap study

Operation Fuel released its statewide 2016 Home Energy Affordability Gap report on Dec. 6.

While Connecticut’s annual energy affordability gap decreased for the past year, it still is substantial and presents a crushing financial burden for more than 322,000 households that can’t afford to pay their energy bills, according to the Home Energy Affordability Gap: Connecticut (2016) report, which Operation Fuel released on Dec. 6 during a news conference at the state capitol.

There now is a $399 million energy affordability gap for state households with incomes at or below 200% of the Federal Poverty Level. The affordability gap is the portion of their energy bills that 322,000 households can’t afford to pay, not the entire amount that they owe.

While the gap declined by nearly $71 million from $470 million in 2015, this drop is primarily attributed to a reduction in the price of home heating oil and natural gas over the past year. There are about 9,000 more Connecticut households this year that can’t afford their energy bills compared with 313,000 last year. On average, each of the 322,000 households owes about  $1,241 more in annual energy bills than they can afford to pay. Many of these households consist of working families with young children or elderly adults who are living on a fixed-income.

“Even though energy prices were lower this past year, there still is a significant gap between what lower-income households pay for energy bills and what they actually can afford to pay. And when low-income households do pay their bills in full and on time, it is frequently at the expense of other basic necessities such as nutritious food, healthcare and education,” said Karen E. Adamson, Operation Fuel’s executive director.

Operation Fuel is Connecticut’s only year-round, statewide nonprofit emergency energy assistance program. This past fiscal year, Operation Fuel provided over $3.18 million in energy assistance to more than 7,705 households.

“The State of Connecticut has a large home energy affordability gap facing its low-income households, with available resources grossly insufficient to address the problem. As a result of this mismatch between energy bills and the resources needed to pay them, low-income households incur unpaid bills and experience the termination of service associated with those arrears,” stated the energy affordability gap report, which was prepared for Operation Fuel by regional economist Roger D. Colton, a partner with Fisher, Sheehan & Colton Public Finance and General Economics, of Belmont, Mass.

“The need for emergency energy assistance for Connecticut’s most vulnerable households is extensive. But our state’s available resources for addressing this problem are extremely insufficient.We must continue to work together to find solutions to Connecticut’s energy affordability crisis,” said Adamson

Now in its 40th year, Operation Fuel is a private, nonprofit program that provides emergency energy assistance year-round through its statewide network of 107 fuel banks to lower-income working families and individuals, the elderly, and disabled individuals who are in financial crisis.

For more information and to see the Home Energy Affordability Gap report, go to operationfuel.org/our-publications/

Key findings of the 2016 report include:

  • The state’s annual home energy affordability gap currently is $399 million for households with incomes at or below 200% of the Federal Poverty Level.

  • There are more than 322,000 Connecticut households that can’t afford their energy bills. On average, each owes about  $1,241 more in annual energy bills than they can afford to pay.

  • For Connecticut households in “deep poverty,” home energy costs not only impede their ability to keep their energy services, but also obstruct their access to housing, food, medical care and other basic necessities.

  • Connecticut’s available resources for addressing the energy affordability crisis are extremely insufficient. The federal Low-Income Home Energy Assistance Program (LIHEAP) is the state’s primary source of energy assistance.

  • This past year, LIHEAP continued to cover only a fraction of the Home Energy Affordability Gap for a fraction of income-eligible households despite the decrease in the home energy affordability gap.

  • Connecticut’s LIHEAP allocation for the 2015-16 heating season was $85 million, which covered only about 21% of the state’s total affordability gap in 2016.

  • More than 400,000 Connecticut residents with incomes at or below 200% of poverty live in multi-family housing units, and the vast majority are renters. Energy efficiency in multi-family housing could be improved by about 30%.