Low-Income Households Spend Nearly 20% of Income on Home Energy and Auto Fuel Costs

Low-Income Households Spend 20% Income Home Energy Auto Fuel Costs

New research from ACEEE shows that combined home energy and transportation fuel costs make up a substantial share of household income. On average, low-income households spend 17.8% of their income on energy bills and transportation fuel, more than three times the national average. A staggering three in four low-income households experience high combined energy burdens, which we define as spending more than 12% of their income on energy.

Combined energy burdens also vary based on race and ethnicity. Hispanic households experience the highest combined burdens, spending on average 7.9% of their income on combined energy costs, 42% above the national average burden. Black households experience the second-highest combined burdens, spending on average 6% of their income on combined energy costs, roughly 10% above the national average.

Though differences in income account for much of the disparities in combined energy burdens, more burdened households may experience high energy costs due to myriad intersecting factors. Low-income residents may own or rent homes built to out-of-date energy codes or in need of significant weatherization or appliance upgrades. Rural or suburban residents may live far from their jobs and essential services, or otherwise rely on personal vehicles for long commutes. For example, the average transportation energy burden of Hispanic households is relatively high partly because many of these households live in the South or Southwest, which have lower population densities and limited public transportation options compared to other areas, and these households are more likely to work in rural areas with long commutes.

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