Low-income people are afforded assistance to pay their electricity and gas bills through a Federally funded program called LIHEAP, or Low Income Home Energy Assistance Program. The objective of this program, which is administered by the Department of Health and Human Services (HHS), is to minimize health and safety risks by ensuring low-income people can afford heating and cooling costs (U.S Department of Health and Human Services). Based on income, a family can apply for assistance to pay an electric bill, and the funds for LIHEAP will go directly to the electric company with which the family has services.
While the program is beneficial in helping to leverage the burden these families face with the increased costs of heating and cooling, the program does not have specific measures which work toward minimizing the overall energy consumption of each family, therefore reducing their monthly bills. The Department of Energy administers a program that sometimes works in conjunction with LIHEAP, called the Weatherization Assistance Program, or WAP. The Weatherization Assistance Program affords low-income homeowners the necessary repairs to properly insulate their homes and to regulate indoor heating and cooling.
States can use approximately 25% of LIHEAP funds to assist with the WAP efforts (Department of Energy). With many states hoping to improve initiatives toward reducing Carbon Dioxide emissions, implementing stronger sources of renewable energy into the Weatherization program can lower the funds needed for LIHEAP by decreasing dependency on energy assistance. If the Weatherization Assistance Program used renewable sources of energy to benefit low-income families, it would significantly reduce harmful emissions into the atmosphere.
Researchers from the Oak Ridge National Laboratory conducted a study to compare and correlate the effects of LIHEAP and WAP. According to the report done by Bruce Tonn, Richard Schmoyer, and Sarah Wagner, “The overall conclusions of this study are that weatherization decreased the need for high energy benefits but did not lead to low income households relinquishing the need for standard LIHEAP benefits” (13). Because the Weatherization Assistance Program has minimal, yet positive effects on families’ need to use LIHEAP, small improvements to the type of services that are included with it could prove to be beneficial.
Implementing solar energy and other renewable resources could have a great impact on the energy burden that many low-income families face. A report done by Meg Power, PhD, called “Low Income Consumers’ Energy Bills and their Impact in 2006,” explained that low-income families pay a significantly higher percentage of their annual income toward energy bills. Dr. Power cited statistics from the Department of Energy that showed that low-income people were expected to pay approximately 25% of their annual income on energy bills (Power 2). Increased fuel oil is particularly an important factor in forecasting the increase of Energy bills, and fuel oil prices increasing from 2006 to 2007, will necessitate alternative measures toward reducing energy costs for low-income families. Certain alternative energy sources may prove difficult to supply to some low-income families, but studies have shown where such programs may be beneficial.
The Florida Solar Energy Center conducted anexperimental use of solar water heaters in coordination with the Weatherization Assistance Program. Some of the findings showed that access to ample solar energy and good water sources proved difficult for some of the clients, which eliminated several economically eligible families from getting the solar panels installed. While the experimental project exhibited some difficulties, 77% of the participants reported satisfactory performance of the solar systems(Harrison 1). This study shows that renewable resources can prove beneficial to low-income families, yet more research and refining may be needed in the area of solar energy.
Maintenance of technical components such as solar panels and florescent light bulbs can be a challenge for program administrators of alternative energy sources for low-income families. Without the income, how can they be expected to afford the repairs and renewal of such things as time progresses? In the solar heated water study done by the Florida Solar Energy Center (FSEC), most of the clients surveyed (77%) were satisfied with their service, and the concluding results, as posted on the FSEC’s Solar Weatherization Assistance Program (SWAP) webpage, explain that there were “few component failures;” “Most installation discrepancies are easily fixed;” and “Most discrepancies are related to workmanship rather than equipment problems” (FSEC).
Because implementing solar energy sources on such a large scale such as necessary for a low-income population is relatively new and not yet fully explored, the potential for more extensive solar services has the potential to make a fairly large impact on that population. Independent studies, perhaps in partnerships with private enterprises such as solar panel manufacturers and with the Weatherization Assistance Program, could reduce the already low rate of equipment malfunctions, reducing the risk of increasing maintenance costs for low-income families.
In the Solar Weatherization Report done for the Florida Solar Energy Center, the average cost, per household, for a solar system installed in Florida was $1, 555 (Harrison and Long). Client data, as collected by the Northeast Florida Community Action Agency inBunnell, Florida in 2007, shows that the average LIHEAP expenditure per client per each visit to the agency is approximately $250. Clients are allotted up to three services per year. One of the three types of assistance that a client receives is a general home energy assistance that has a maximum value of $200, and a minimum of $100, depending on the income of the household (these numbers have increased since 2007).
The other type of assistance is called a Crisis Assistance, and it can be administered to a client once during the summer, and again during the winter it has a maximum benefit of $400 (NFCAA). Combined, one client can use all three types of assistance during one year, a potential figure of $700 per family, based on the average benefit as outlined in the client statistics provided by Northeast Florida Community Action Agency. If solar energy could decrease a client’s energy bills enough to ward off the necessity to obtain crisis benefits, that client would, on average, use only $250 of LIHEAP assistance per year for the general home energy assistance. Considering the cost of implementing a solar energy powered water heaters, the government could spend less money in funding for LIHEAP, even with the costs of solar energy installation, but would not reap the benefits of reduced funding for several years.
Because solar panels are not feasible for every household, such a renewable resource is not the only means to reducing energy consumption for low-income families. A report done by the Consumer services Information Systems Project, on Pennsylvania’s Low Income Usage Reduction Program (LIURP), a program that requires major utility companies to weatherize the homes of and give energy education to low income families, found that “Many low income utility consumers have lower utility bills, improved bill payment patterns, and conserve energy with Pennsylvania’s Low Income Usage Reduction Program (LIURP)” (CSIS). The study done on LIURP also reported the bill payment behavior of the program’s participants, and it found that “Specifically, electric heating consumers in arrearage prior to LIURP increased the amounts paid from an average of 81 percent of their annual charges for current usage to an average of 103 percent in the post-LIURP year” (CSIS).
Bill payment behavior changes can be a result of lower energy costs associated with the weatherization of the homes, as well as a better understanding of energy conservation as a result of the mandated education. While weatherizing homes can reduce heating and cooling costs, some minor changes in energy consumption behaviors can have a significant effect on energy consumption
Given that approximately 34 million households out of 107 million households in the United States, as of 2001, were eligible for energy assistance (Energy Information Agdministration), using weatherization programs that maximize energy efficiency in appliances as well as offering energy consumption education could decrease energy consumption in the United States significantly. At the core of such an undertaking, there would be a societal and perhaps economic shift that would work opposite to trickle-down theories. Since energy assistance-eligible families represent nearly 33% of the nation, buying trends, whether done by the government on their behalf or by the consumers through energy economy education, could increase the demand of energy efficient appliances. In short, changing the energy consumption behavior of low-income families in any way possible could greatly impact the nation’s energy consumption.