Cindy Camp is one of many Americans facing rising utility costs. Ms. Camp, who lives in Baltimore with three family members, said her gas and electric bills “kept rising,” reaching as much as $900 a month. Her family has tried to use less hot water by doing less laundry, and she now eats more fast food to save on grocery bills.
Ms. Camp wants to save money on energy costs by switching to more energy-efficient appliances, such as a heat pump and solar panels. But she just can't afford it.
“It’s a struggle for me to even provide nutrition,” Ms. Camp said.
According to data from the Bureau of Labor Statistics, electric bills have risen nationwide, and in Baltimore, electric rates have risen nearly 30 percent over the past decade. While cleaner energy systems and more efficient appliances could help low-income households mitigate some of these increases, many face barriers to accessing these products.
Low-income households are slower to adopt clean energy because they often lack adequate savings or have low credit scores, which can affect their ability to finance projects. Some also found it difficult to navigate federal and state programs that would make installations more affordable, and many are renters who can't make upgrades themselves.
Energy costs have traditionally been a greater burden for low-income households, which typically spend a much larger percentage of their gross income on utility bills than higher-income households. according to the Department of Energy. Many also live in older, less efficient homes, which can lead to higher utility bills. According to the Energy Information Administration, in 2020, 34 million U.S. households, or 27 percent of all households, reported having difficulty paying their energy bills or experiencing unsafe temperatures in their homes due to concerns about energy costs.
The Biden administration has launched a series of programs to increase access to clean energy and reduce household electricity bills. The effort is part of a broader push to reduce carbon emissions in response to climate change, which often disproportionately affects disadvantaged communities.
These include rebates for energy-efficient appliances and tax credits for the purchase of solar panels and electric cars. In recent months, administration officials have awarded funding for energy efficiency improvements to government-subsidized housing. The federal government will also offer bonus tax credits for clean energy investments in low-income areas and provide billions to increase access to residential solar energy.
In remarks Wednesday about the administration's efforts to make energy more affordable, Treasury Secretary Janet L. Yellen said the measures could help lower energy bills for low- and middle-income families “immediately.” She said they would also strengthen domestic production of clean energy, which would reduce costs over time.
“This will make clean energy even more affordable for American consumers,” Ms. Yellen said at a community college in Boston.
Still, some advocates said it's a challenge for the government's investments to reach low-income communities.
“To me, the issues for people in Baltimore and in inner cities everywhere are the same: 'We're struggling to pay our bills now,'” said Kristal Hartsfield, executive director of the National Alliance for Equity in Energy and Infrastructure, which connects communities and companies on issues related to changes in the energy sector. “We can’t flip the switch to clean energy tomorrow.”
Although White House officials said they would provide technical assistance to help people access new programs, many who want to take advantage of federal and state programs said they often face a major hurdle: paperwork.
Ms. Camp, 56, lives in a single-family home in a Northeast Baltimore neighborhood where she has never seen a solar panel on a home or residents with electric vehicles. Nevertheless, she would like solar power and a heat pump – if she could navigate the depth of the application process.
“It’s really disheartening,” said Ms. Camp, an AmeriCorps member. “The bureaucratic effort is so great.”
Patricia Johnson, 68, a retired machinist who lives with her husband in East Baltimore, said her home's furnace is more than two decades old and in need of repair, but she can't afford $10,000 to $15,000 to replace it of the system.
Ms. Johnson said she had a hard time figuring out what assistance programs she qualified for, so she went to a nearby community center run by GEDCO, a local nonprofit. Ms. Johnson later learned that she had qualified for a federal program to finance energy efficiency improvements, but it was still difficult to navigate the paperwork and she would not have applied without guidance.
Laurel Peltier, chairwoman of the Maryland Energy Advocates Coalition and a volunteer at GEDCO who worked with Ms. Johnson, said most of the people she helped did not have computers or printers, making it more difficult for them to apply and to find out about the available device programs.
“Government agencies still have a lot of work to do to effectively distribute programs to low-income people,” Ms. Peltier said.
The nation's largest municipal utility, the Los Angeles Department of Water and Power; the National Renewable Energy Laboratory; and the University of California, Los Angeles, recently published the first comprehensive study on some of the impacts of the energy transition on wealthy consumers. The study highlighted the growing disparities in Los Angeles between those who can afford clean energy upgrades and those who cannot.
Part of the reality, as Los Angeles recognized in its study and as some energy experts have argued, is that the public needs to be educated about energy issues as well as how to transition to clean energy technologies and the incentives available.
Experts at the National Renewable Energy Laboratory say the energy transition will require broad participation from utilities and energy providers as well as lower-income and wealthier Americans. This means more needs to be done to include those who can least afford it.
Although many of the new rebates are generous, they still may not cover the full price of clean energy products, said Diana Hernandez, associate professor of sociomedical sciences and co-director of the Energy Opportunity Lab at the Columbia Center on Global Energy Policy. The cost of heat pumps, which can heat and cool homes more efficiently than traditional furnaces and air conditioners, varies, but an average installation costs $16,000. The new rebates, which are not yet available, would only save these systems by up to $8,000.
Tax credits can cover 30 percent of the cost of installing solar panels. But many low-income people don't pay enough taxes to take full advantage of it, and the average cost of a home solar system is about $25,000, according to the Solar Energy Industries Association.
Low-income households are less likely to make these upgrades if they already struggle to afford the necessary expenses, and many are also renters who will have a harder time benefiting from the new programs because landlords may not have an incentive “To make efficiency improvements,” Ms. Hernandez said.
However, she noted that people could subscribe to some of the energy generated by “community solar” projects, which are external solar systems, or lease panels.
After conducting its study, Los Angeles increased its used electric vehicle rebates from a maximum of $2,500 to up to $4,000 for qualified consumers. And the city announced that it would build and operate its own fast-charging network in low-income communities.
Experts say that without such efforts, the energy transition will only hurt those who can least afford to participate.
“This energy transition, we're still figuring it out,” said Stephanie Pincetl, a professor at the UCLA Institute of the Environment and Sustainability and director of the university's California Center for Sustainable Communities, who participated in the study in Los Angeles. “We have to get this right or it will only worsen inequality.”