Heating bills for U.S. households are projected to rise more than 7% nationwide this winter, with families that rely on heating oil facing possible increases of up to 70%, the National Energy Assistance Directors Association warns in a new report.
The association, which represents state officials seeking federal funding for energy assistance, points to global fuel supply disruptions tied to the U.S.-Israel war with Iran and Russia’s ongoing war in Ukraine. NEADA says refineries in the Middle East and Russia have shut down or cut production, tightening supplies and pushing costs higher as millions of families already struggle to pay utility bills.
Roughly one in six U.S. households is behind on utility payments, collectively owing about $23 billion, NEADA reports. The projections arrive after a record-hot summer that brought widespread financial hardship and electricity shutoffs.
Heating oil users face steepest increases
Households that use heating oil, concentrated in the Northeast and Alaska, face the largest increases. Nearly 5 million households rely on the fuel, and their seasonal costs could jump 70%, to approximately $2,977.
In the Northeast, average heating bills are expected to rise 16.9%, or $221, from $1,311 last winter to $1,532 this winter. The region has some of the nation’s highest electricity prices and the greatest concentration of heating oil customers.
“For higher-income households, these increases may be an inconvenience. For low- and middle-income families, they can be devastating,” Mark Wolfe, NEADA’s executive director, said in a statement. “Families are already struggling with rising costs for food, housing and other necessities. Adding hundreds or even thousands of dollars to their winter heating bills will push many of them further into debt.”
Electric and propane bills also climb
Other heating sources are also expected to cost more. Electric heating costs could increase about 6%, to $1,215, while propane bills are projected to rise roughly 5%, to an average of $1,350.
Wolfe wrote last month that the Iran war is deepening the U.S. energy crisis, describing heating oil as “the canary in the coalmine” for the broader affordability crisis. He said the situation in the Strait of Hormuz remains highly volatile, and continued uncertainty about global oil supplies makes it difficult to predict where prices will go.
“For planning purposes, we believe it is prudent to assume that heating oil prices will remain elevated throughout the winter heating season,” Wolfe said.
Summer shutoffs highlight financial strain
The warning follows a summer of extreme heat and financial strain. In July, the hottest month ever recorded in the U.S., utilities disconnected power to 173,598 households across 10 states despite dangerous temperatures, NEADA said.
With winter bills expected to climb, NEADA is urging Congress to provide relief.
“Energy is not a luxury. Families need to be able to heat their homes without worrying about whether they can afford food, medicine or rent,” Wolfe said. “Congress has an opportunity to provide immediate relief before these higher winter bills arrive.”
NEADA said it is prudent to assume heating oil prices will remain elevated throughout the winter heating season, with global oil supply conditions still uncertain. The projected increases vary by fuel and region, but the report warns that higher bills will add pressure on households already carrying utility debt.