2017’s Most & Least Energy-Expensive States
3:30 AMPosted by: Richie Bernardo
Get ready to crank up your air conditioner — and utility budget. July tends to be the hottest month of the year. So if your heat-averse body forces you to be more consumptive than conservative, this month’s higher-than-usual power bill could burn a hole through your wallet.
In the U.S., energy costs eat between 5 and 22 percent of families’ total after-tax income, with the poorest Americans, or 25 million households, paying the highest of that range. And lower energy prices don’t necessarily equate to savings. Where we live and how much energy we use are a big part of the equation. For instance, although electricity is relatively cheaper in Southern Louisiana, its scorching summer heat raises costs for residents compared with the temperate climate in more energy-expensive Northern California, where heating and cooling units stay idle most of the year.
To better understand the impact of energy on our finances relative to our location and consumption habits, WalletHub’s analysts compared the total monthly energy bills in each of the 50 states and the District of Columbia. Our analysis uses a special formula that accounts for the following residential energy types: electricity, natural gas, motor fuel and home heating oil. Read on for our findings, tips and insight from a panel of experts, and a full description of our methodology.
Main Findings Embed on your website<iframe src="//d2e70e9yced57e.cloudfront.net/wallethub/embed/4833/geochart-energyexpensive.html" width="556" height="347" frameBorder="0" scrolling="no"></iframe> <div style="width:556px;font-size:12px;color:#888;">Source: <a href="http://ift.tt/2u8dyRk;Total Energy Costs by State
|
Overall Rank* |
State |
Total Energy Cost |
Monthly Electricity Cost (Rank) |
Monthly Natural-Gas Cost (Rank) |
Monthly Motor-Fuel Cost (Rank) |
Monthly Home Heating-Oil Cost (Rank) |
|---|---|---|---|---|---|---|
| 1 | Connecticut | $380 | $166(3) | $39(19) | $99(35) | $76(2) |
| 2 | Alaska | $332 | $135(16) | $59(2) | $88(48) | $50(7) |
| 3 | Rhode Island | $329 | $123(29) | $58(4) | $80(50) | $69(3) |
| 4 | Massachusetts | $327 | $131(22) | $54(6) | $89(45) | $53(6) |
| 5 | Wyoming | $320 | $108(40) | $40(16) | $172(1) | $1(26) |
| 6 | Georgia | $310 | $152(8) | $40(15) | $118(14) | $0(44) |
| 7 | Maine | $308 | $110(36) | $7(49) | $107(25) | $84(1) |
| 8 | Mississippi | $307 | $159(5) | $17(46) | $131(4) | $0(51) |
| 9 | New Hampshire | $306 | $134(17) | $20(42) | $89(46) | $63(5) |
| 10 | Vermont | $305 | $116(33) | $18(45) | $103(32) | $68(4) |
| 11 | Alabama | $301 | $168(2) | $21(40) | $112(19) | $0(39) |
| 12 | Delaware | $301 | $158(6) | $34(26) | $95(39) | $14(12) |
| 13 | Maryland | $300 | $146(9) | $38(21) | $101(33) | $15(11) |
| 14 | North Dakota | $294 | $130(23) | $24(38) | $136(2) | $4(15) |
| 15 | Indiana | $292 | $125(27) | $40(17) | $126(8) | $1(29) |
| 16 | West Virginia | $290 | $130(24) | $29(30) | $128(7) | $4(17) |
| 17 | Nevada | $290 | $129(25) | $36(23) | $124(10) | $0(32) |
| 18 | Missouri | $286 | $134(18) | $39(20) | $113(17) | $0(38) |
| 19 | Oklahoma | $286 | $131(20) | $35(24) | $119(13) | $0(47) |
| 20 | Pennsylvania | $285 | $125(28) | $44(11) | $91(44) | $25(9) |
| 21 | New York | $284 | $109(38) | $58(3) | $87(49) | $30(8) |
| 22 | Texas | $283 | $153(7) | $20(41) | $109(22) | $0(50) |
| 23 | New Jersey | $279 | $120(31) | $52(8) | $92(43) | $15(10) |
| 24 | South Carolina | $278 | $173(1) | $16(48) | $89(47) | $0(31) |
| 25 | Tennessee | $274 | $143(12) | $22(39) | $110(20) | $0(35) |
| 26 | Utah | $273 | $91(50) | $52(7) | $129(5) | $0(33) |
| 27 | North Carolina | $272 | $144(11) | $16(47) | $107(24) | $4(16) |
| 28 | Kansas | $271 | $122(30) | $44(12) | $105(28) | $0(43) |
| 29 | Ohio | $271 | $120(32) | $49(9) | $99(36) | $3(20) |
| 30 | Virginia | $270 | $142(13) | $27(33) | $95(40) | $7(14) |
| 31 | Minnesota | $270 | $103(44) | $41(14) | $123(11) | $3(18) |
| 32 | Kentucky | $270 | $131(21) | $26(35) | $113(18) | $1(30) |
| 33 | Michigan | $269 | $104(43) | $60(1) | $104(30) | $1(27) |
| 34 | Idaho | $269 | $113(35) | $29(31) | $125(9) | $2(22) |
| 35 | Florida | $269 | $162(4) | $3(51) | $103(31) | $0(46) |
| 36 | Arkansas | $269 | $131(19) | $28(32) | $109(21) | $0(40) |
| 37 | Hawaii | $264 | $145(10) | $4(50) | $115(15) | $0(48) |
| 38 | Montana | $263 | $107(41) | $32(27) | $122(12) | $2(24) |
| 39 | South Dakota | $260 | $128(26) | $25(37) | $105(27) | $2(21) |
| 40 | Wisconsin | $260 | $109(37) | $39(18) | $109(23) | $3(19) |
| 41 | Louisiana | $258 | $142(14) | $19(44) | $97(38) | $0(42) |
| 42 | California | $257 | $100(45) | $30(29) | $128(6) | $0(41) |
| 43 | Arizona | $257 | $139(15) | $20(43) | $98(37) | $0(49) |
| 44 | New Mexico | $256 | $90(51) | $31(28) | $135(3) | $0(45) |
| 45 | Nebraska | $253 | $114(34) | $35(25) | $104(29) | $0(36) |
| 46 | Iowa | $251 | $108(39) | $36(22) | $106(26) | $1(28) |
| 47 | Illinois | $247 | $97(47) | $56(5) | $94(42) | $0(37) |
| 48 | Oregon | $246 | $106(42) | $25(36) | $113(16) | $2(25) |
| 49 | Colorado | $228 | $92(49) | $42(13) | $94(41) | $0(34) |
| 50 | Washington | $226 | $97(48) | $27(34) | $101(34) | $2(23) |
| 51 | District of Columbia | $219 | $99(46) | $49(10) | $63(51) | $8(13) |
According to the U.S. Energy Information Administration, the highest energy consumption of the year is recorded in July, followed by August, which translates to higher energy costs during this period. For advice on reducing our dependence on traditional energy sources — and thereby diminishing out-of-pocket costs — we asked a panel of energy and policy experts to share their thoughts on the following key questions:
- What are some good tips for saving money on energy bills?
- What makes energy costs higher in some states than in others?
- Are tax deductions and credits effective at incentivizing households to be more energy-efficient?
- Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way?
- Will recent regulatory changes made by the Trump administration bring coal back?
Timothy Fitzgerald Associate Professor of Business Economics at Texas Tech University
Nancy C. Loeb Assistant Clinical Professor of Law and the Director of the Environmental Advocacy Clinic at Northwestern Pritzker University Law School’s Bluhm Legal Clinic
Melissa Powers Jeffrey Bain Faculty Scholar and Professor of Law at Lewis & Clark Law School
Max Shtein Professor of Materials Science and Engineering & Chemical Engineering at The University of Michigan Energy Institute
Marco J. Castaldi Professor in the Chemical Engineering Department at The City College of New York
Kenneth B. Medlock III James A. Baker III and Susan G. Baker Fellow in Energy and Resource Economics & Senior Director of the Center for Energy Studies at Baker Institute for Public Policy, and Director of the Masters in Energy Economics Program at Rice University
Joshua P. Fershée Associate Dean for Faculty Research & Development, Professor of Law, and Director of the Master of Law Program in the Center for Energy & Sustainable Development at West Virginia University College of Law
Inara Scott Assistant Professor in the College of Business at Oregon State University
Howard A. Learner Executive Director of the Environmental Law & Policy Center & Adjunct Professor at the Northwestern University School of Law and the University of Michigan Law School
Ethan Elkind Director of the Climate Program at the Center for Law, Energy & the Environment at University of California Berkeley School Of Law
David B. Spence Professor of Business, Government and Society in the McCombs School of Business & Professor of Law in the School of Law at the University of Texas at Austin
David M. Driesen University Professor at Syracuse University College of Law
Blake Hudson Professor of Law at the University of Houston Law Center
Auriane Koster Adjunct Professor in the School of Sustainability at Arizona State University
What makes energy costs higher in some states than in others? Two factors are important here. One is that heating and cooling demands vary depending on climate and weather. It costs more to heat in Fairbanks, Alaska than in San Diego, California -- and more to cool in Houston, Texas than Denver, Colorado. There are other reasons why energy demand varies across the country -- as an example, rural residents tend to drive more than urban residents, and will therefore tend to spend more on gasoline. The second important factor is that energy is provided in different forms and at different prices in different regions of the country. Electricity is relatively inexpensive in the Pacific Northwest because of large hydroelectric generating capacity. Home heating is relatively expensive in New England because of the reliance on heating oil. Oil and derived products are traditionally less expensive in producing states like Texas, but very expensive in Hawaii, where they must be shipped in from elsewhere. Are tax deductions and credits effective at incentivizing households to be more energy efficient? Energy demand is often not very sensitive to price. Research has repeatedly indicated that many people do not fully recognize the financial gains to be had from greater efficiency. It is clear that there are important differences in uptake of energy efficiency incentives across different groups. Whether tax deductions and credits are a cost effective means of promoting energy efficiency depends on which groups are targeted. Will recent regulatory changes made by the Trump administration bring coal back? Coal will continue to be an important part of the electricity generating mix in coming years. However, its historic dominant position has been deeply eroded by innovations in natural gas production and other alternative generation technologies, including wind and solar. Nancy C. Loeb Assistant Clinical Professor of Law and the Director of the Environmental Advocacy Clinic at Northwestern Pritzker University Law School’s Bluhm Legal Clinic 
What are some good tips for saving money on energy bills? Some tips for saving money on energy bills are obvious -- turn off lights when you leave a room, use the energy efficient settings on appliances, like dishwashers and dryers, use the cold water setting on your washing machine (most detergents today are made to work just as well in cold water), use the smart thermostat and set heating or cooling to reach comfortable levels shortly before you arrive home, and use LED lightbulbs. You can save even more over time by installing energy efficient windows -- look for discounts and refunds provided by your electric or gas company. What makes energy costs higher in some states than in others? Many factors affect energy costs, and can lead to higher costs in some states. Some states depend on more expensive energy sources, like nuclear or coal, which were efficient when they were installed many years ago, but today are more expensive than natural gas, wind or solar. Having a local source of energy supply can also affect energy costs -- states with wind power, for example, may have lower costs. And how energy is regulated in each state affects costs as well. Some states have introduced competition to supply energy, which generally lowers costs. Other states are sticking with the traditional integrated utility model with guaranteed rates, which tend to be higher. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? I believe very strongly that governments should provide energy assistance to low-income households. Energy is fundamental to life in the United States, and we need to make it readily available to everyone. Beyond the need for heat in the winter and fuel for cooking, energy is essential for low-income children to keep pace and move ahead. So much of what we use to learn today is energy dependent, for example, computers and tablets. Assistance can be provided through direct subsidies paid to utilities. Assistance and incentives for purchase and installation of energy efficient thermostats, appliances and windows also provide huge benefits to both low-income families and our energy system overall. Will recent regulatory changes made by the Trump administration bring coal back? Regulatory changes made by the Trump administration will not bring back coal or coal jobs. The reality is that coal is more expensive today than other, much cleaner, forms of energy, like natural gas and renewables. Regulation is not coal’s problem. The problem of coal is that we have an abundance of alternative and much better energy options in the U.S. today. Exports of coal are not going to save the industry either. New coal plants require huge investments. With lower prices for renewables, storage capabilities rapidly coming on line, and an excess global supply of natural gas, coal is not a wise investment. Melissa Powers Jeffrey Bain Faculty Scholar and Professor of Law at Lewis & Clark Law School 
What are some good tips for saving money on energy bills? Consumers can save money through behavioral changes and physical retrofits. In terms of behavioral changes, consumers can reduce overall energy consumption, and thus energy bills through a number of practices, including: turning off lights, unplugging appliances, taking shorter showers, and setting the thermostat so both heating and air conditioning are not too high. Consumers can also change when they use larger appliances to take advantage of off-peak energy prices. In some states, electricity prices change during the day to reflect supply and demand. In these places, prices are highest during the daytime and then drop during the night, when most people are sleeping. Prices may include "peak" rates for times of the day when energy demand is especially high -- for example, in the Southwest, peak demand occurs in the afternoon and early evening, when people get home from work and school and turn up their air conditioners, computers, TVs, etc. Providing electricity during these peak times costs more, so electricity rates are usually highest. Consumers can save money by not using the dishwasher, washing machine, or other energy-intensive appliances. Newer appliances may have timers on them that make it easier to schedule usage. Consumers who have older appliances may need to set reminders on their smart phones, or just get into the habit of turning appliances on during off-peak times. Physical changes can be very effective, but they also require upfront expenditures, which some people cannot afford. First, consumers can make a low-cost, highly effective retrofit to replace older incandescent lightbulbs with LED bulbs. According to the U.S. Department of Energy, consumers can save about $75 per year by replacing the five most used lightbulbs in a house. LED bulbs used to be quite expensive, but they now cost as little as $3.00 each, and they can last for up to 50,000 hours. Second, consumers can save energy by replacing inefficient appliances and electronics with efficient Energy Star products. The Energy Star label means that an appliance or other product meets federal efficiency standards. The Energy Star program also has a ranking of the most efficient products (i.e., those that go beyond the minimum requirements), so I'd use that program as a shopping guide. Third, consumers can save a great deal of money through home retrofits to reduce energy use associated with home heating and cooling, which account for about 1/2 of the typical energy bill. Many existing homes in the United States lack adequate insulation and proper windows and doors. Options for improving insulation and reducing energy use include: sealing leaks around windows and doors with weather-stripping, adding insulation to attics, having insulation blown into exterior walls, and replacing single-paned windows with (at least) double-paned ones. Also, a larger house is usually more expensive to heat and cool, and homebuyers and renters should take this into account before they sign any contracts. Finally, in some states, energy consumers can actually get paid for reducing their energy consumption (through "demand response" programs) or for installing solar panels or small wind turbines, and sending excess solar or wind power back to the grid (through "net metering"). Consumers should reach out to their utilities to learn if these programs are available and, if so, how to participate. What makes energy costs higher in some states than in others? Several factors affect energy costs. As a general rule, state regulators set the retail rates consumers pay for electricity and heat. When setting the rates, the regulators aim to make sure that the energy utilities earn back their full operating costs, as well as a profit that is adequate to allow the utilities to continue to attract investment. Operating costs include the costs of fuel, administration, labor, and depreciation expenses associated with building energy infrastructure. These operating costs vary regionally, based on local conditions, salaries, fuel type, and other factors. If an energy company is heavily invested in fossil fuels, and fuel prices spike, so will consumers' energy prices. Similarly, if an energy company recently built new infrastructure, consumer prices may be higher to cover those investments. Labor prices, the price of land, taxes, and many other costs vary from region to region or state to state, and these also affect energy prices. Regulators in some states may also be willing to allow utilities to earn larger revenues and profits than in other states. Finally, the effectiveness of ratepayer advocates may affect rates; in most states, ratepayers are represented either by public officials or non-profit organizations, who work to keep prices low. Some ratepayer advocates seem to achieve better results than others. States also have different policies that may affect consumer rates. For example, many states include "public purpose" charges in their bills to help support energy efficiency programs, low-income assistance, and renewable energy programs. These charges may raise energy bills to a moderate degree, but they may also help avoid investments in more expensive power plants and infrastructure. In some places, consumers are still helping to pay off the costs associated with failed investments in nuclear power plants, and other states may face new "stranded cost" payments for other failed power plants. Finally, demand and resource availability affect energy prices. In the Pacific Northwest, for example, prices are generally low due to several factors, including high energy efficiency rates, the availability of low-cost hydroelectric power and other renewable resources, and a moderate climate. Are tax deductions and credits effective at incentivizing households to be more energy efficient? It depends on how they are structured. As a general rule, the most effective programs are those that either provide direct rebates at the point of purchase (e.g., when buying an efficient appliance), or that send real-time information to households about savings. Rebates can help encourage consumers to buy more efficient products. However, in some cases, tax deductions and credits are not available until the consumer files taxes, and the delay between the purchase and the tax filing deadline may undermine the price signals deductions and credits aim to send. It is more effective, and likely more efficient, for the tax deductions and credits to be available immediately, at the point of purchase, through a price discount. Otherwise, it is important for contractors and salespeople to be trained to communicate to the consumers about the tax credits and deductions, so that consumers know how they operate and how to include them in their tax forms. Behavioral studies show that the most effective economic incentives include real-time communication and rewards. "Smart" meters and other energy communication systems should be able to communicate to consumers about energy prices and potential energy savings associated with energy use. For example, if a consumer were about to run the dishwasher, the dishwasher or smart phone app should be able to communicate how much it would cost the consumer, and indicate whether the costs would be lower (or higher) to run at a different time. This communication, particularly if it is combined with other technologies that allow the consumer to schedule a time for the dishwasher to run, has the greatest chance of affecting behavior. An even stronger program would include an additional incentive, such as entry into a lottery or prize drawing, to encourage the consumer to delay running the dishwasher. In other words, a combination of economic incentives, behavioral incentives, and real-time communication would have the greatest impact. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? Yes, absolutely, the government should continue to provide energy assistance to low-income households. Energy is an essential service, and low-income households already bear disproportionate "energy burdens," which means that energy already accounts for a high percentage of their annual incomes. Low-income households in Memphis, Tennessee, can spend up to a quarter of their entire incomes on energy. Such a high energy burden leaves very little money for rent, food, healthcare, transportation, other utilities, clothing, or other essential needs. No one in a country as wealthy as the United States should face the prospect of having electricity or heat cut off for failure to pay. Many low-income households include particularly vulnerable individuals, including children, the elderly, and people with disabilities. People in these households cannot afford paying the full price of energy. If they do not receive energy assistance and their electricity or heat is cut off, they are at great risk of harm from excessive cold temperatures in the winter, or hot temperatures in the summer. When people cannot afford to pay for energy supplies, they often turn to dirtier and more dangerous sources of light, heat, and cooking fuel, including kerosene, wood (which, when burned in inefficient stoves or an open fire, releases a lot of particulate matter pollution), and propane. The risks associated with using these alternative energy sources are too high. It's also worth noting that low-income energy burdens are highest in some states that do not have particularly high overall energy prices. A 2016 report by the American Council for an Energy-Efficient Economy showed that the low-income energy burden in cities was highest in Memphis, New Orleans, Birmingham, Atlanta, and Philadelphia (in that order), but electricity prices in Tennessee, Louisiana, Alabama, Georgia, and Pennsylvania are all below the national average. Louisiana has the second-lowest electricity rates in the country, but New Orleans has the second-highest low-income energy burden. This indicates that price distribution, not just overall energy prices, needs attention. So, what are the best ways to provide energy assistance? In the near term, programs that help low-income consumers pay their energy bills need to be continued and require more funding. The federal government's Low-Income Home Energy Assistance Program, which provides states funding to help support low-income energy programs for rural and urban citizens, needs to be strengthened and better funded. Unfortunately, President Trump's proposed budget would eliminate LIHEAP funding entirely, and leave people in the cold without a way to pay for their heat and lights. At the state level, many electricity rates are designed so that higher-income ratepayers help support lower-income ratepayers. These rate structures need to be strengthened and potentially redesigned, to make them more effective. In the longer term, energy assistance should focus on retrofits that make homes more efficient, and providing energy sources that will protect low-income ratepayers from price spikes. Low-income weatherization programs have achieved remarkable success. For example, under the American Recovery and Reinvestment Act (the stimulus bill), over 1 million low-income homes received weatherization assistance. The program made these homes more efficient and livable, and it also created thousands of jobs in construction and manufacturing. Unlike billing assistance programs, which address the consequences of inefficiency, weatherization programs address the causes and create long-term solutions. In addition to weatherization, renewable energy programs should also aim specifically to bring solar panels and other clean energy technologies to low-income communities. California has some very successful programs, including ones that contract with a non-profit organization called Grid Alternatives, to bring solar power to low-income households. Deliberative strategies like those in California can help alleviate the energy burden, while expanding clean energy. Will recent regulatory changes made by the Trump administration bring coal back? No, not at all. On an economic level, coal cannot compete with other energy sources, including natural gas and renewables. Efforts by the Trump Administration to somehow revive coal by repealing health, safety, and environmental regulations will not make coal more competitive with these other energy sources. While it is possible that the Trump Administration's efforts may delay the retirement of some power plants, they will not result in a meaningful rebound of coal use or coal jobs. This is because many states have passed laws that focus on reducing coal and increasing the use of renewable energy and other energy sources that emit less pollution. Also, state regulators have already authorized and planned for the retirement of many older coal plants -- they are unlikely to reverse those processes, because it would take a great deal of money and time. In addition, resource planning in the energy sector typically uses longer horizons than a four-year presidential term. Regulators, utilities, and investors will not consider only the efforts of the Trump Administration; they will evaluate the trends away from coal and towards other energy sources when they make investment and resource portfolio decisions. Similarly, many other countries have enacted laws or policies to transition their own energy use away from coal and towards other, cleaner energy sources. So, as much as the Trump Administration aims to increase the supply of coal, it will not be able to increase demand by states or other countries. It's also important to distinguish between increasing coal production and expanding coal jobs. Due to mechanization and the transition away from underground mining, coal jobs have been declining for 90 years. According to the Mine Safety and Health Administration, 1923 was the peak year for U.S. coal jobs, when 862,536 people worked in the industry. In comparison, according to the same agency, there were 81,485 people working in the coal industry in 2016. Even if some coal jobs come back -- and a few might, but not enough to really matter to the communities in which the coal industry dominates --, this is not the same as "bringing coal back" to its former employment levels. This country is in the midst of a profound energy transition away from fossil fuels. Natural gas has been a major driver of coal's decline, but it is likely that cleaner energy sources will replace it as well. As the costs of renewable resources drop and interest in clean energy increases, more and more states will move away from both coal and natural gas. They will also transition away from petroleum, as electric vehicle penetration increases. These changes will be very positive for our country, and with the right planning, training, and investment, they could create many new employment opportunities in our country. The Trump Administration is focused on moving the energy industry backwards. It would be much more helpful for people employed in fossil-fuel-intensive industries if the Administration focused more on ways to advance our energy economy, in a way that would help workers transition to the future. Max Shtein Professor of Materials Science and Engineering & Chemical Engineering at The University of Michigan Energy Institute 
What are some good tips for saving money on energy bills? A good strategy for saving on energy bills very much depends on the household priorities and lifestyle. In general, families in the developed world have gotten used to a much narrower range of temperatures and expect their indoor environment to stay in this narrow range all the time. For example, we are very used to having ice in our water, but ice actually takes a lot of energy to make. More than making ice, however, air conditioning and heating are two large energy expenditures in a home. Improving insulation helps, but the payback time can be quite long -- 5 or more years in some cases, by which point a family might move out of their current residence. Besides, not many households can spare the up-front expense. However, wearing an extra layer or two of clothes indoors in the winter time is very effective (provided one isn’t already bundling up due to a complete lack of heating), while allowing one to reduce heating bills by 20-50%. In the summer time, keep windows closed during the day and open during the evening, use a thin sheet instead of a blanket. But in general, it’s best to set up these energy saving measures in a way that doesn’t require thinking and deciding on a daily basis. Turning off lights when they’re not necessary is something that’s currently done better in commercial buildings than in households, in large part because many commercial buildings have implemented automatic/occupancy switches. LED-based lighting is also good -- more efficient than conventional light bulbs, more pleasing light than fluorescents, and less waste heat for the AC to deal with. Once these LED bulbs are installed, they last for years, and one doesn’t have to think about them (best if they’re on an automatic switch). Similar to automatic switches for lighting, smart thermostats (which have come down in price considerably) are very effective at lowering energy bills; but you must check if your current AC or heating unit is compatible with a smart thermostat. What makes energy costs higher in some states than in others? This is a two-sided issue: part of it is inherent cost of energy, and part of it is how much energy is used. Think: location, local geography, local weather, extent of urban planning, lifestyles/expectations. Some places are situated further from energy sources, or have less-than-optimal contracts, or fewer options for sources of energy. Fewer options generally means less competition, which can raise prices. Larger homes almost always require more energy, whereas dense apartment buildings tend to reduce energy usage. Are tax deductions and credits effective at incentivizing households to be more energy efficient? It really depends on what your goals are: reducing energy costs for a household, or reducing energy usage? Generally, making energy less expensive will almost always result in an overall increase in energy usage -- this phenomenon had been observed a hundred years ago by Jevons in England, and it still holds largely true. In terms of how a particular household will respond to tax incentives, it depends a lot on where on the income ladder a particular household is, as well as the family’s priorities and awareness. For households low on the income ladder, a (tax) break on energy bills can have a big impact on their budget; the question there is whether that household can plan or stomach a long wait to see the benefit (i.e., get a refund at the end of the year). If a family is high on the income ladder, they have their basics covered, they often engage financial planners, and they can think in terms of long-term payback on initially expensive, energy saving projects. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? The marginal benefit from energy assistance to low-income families is great, and also to the country as a whole. The money it frees up is relatively significant for that household, and almost always translates to greater economic activity by the family. It improves the household’s quality of life substantially, and gives a boost to the local and national economy -- a two-for-one kind of deal. Will recent regulatory changes made by the Trump administration bring coal back? Coal remains a very abundant and important source of electricity in many ways. It’s a proven and reliable source of electricity -- it’s a century old. However, just like horse-drawn carriages relative to modern (gas powered, hybrid, and even electric) cars, coal-derived energy has become more expensive relative to other sources of energy in recent years. This is both from the short-term and long-term perspectives. Not only are natural gas-fired power plants more energy efficient, they’re also much cleaner for the environment. Besides, working in coal mines is nearly as dangerous for one’s health as it used to be -- just look at the recent findings by ProPublica about the Black Lung Disease in coal miners, working in mines that have passed all the standards and regulations. The costs in solar have come down dramatically over the last decade, and will come down even more due to compound effects from the battery and electric vehicle production increases. These compound effects are important, in part because they are often hallmarks of growth markets. And in terms of marginal benefit, many would agree that investing money into new, growing technologies, while simultaneously investing in job (re)training programs would provide better long-term outcomes for the economy. But oftentimes, it’s a question of becoming more adaptable to an ever more rapidly changing world. Marco J. Castaldi Professor in the Chemical Engineering Department at The City College of New York 
What are some good tips for saving money on energy bills? There are a number of things that can be done, and the best is usually to simply check the local utility website (in New York, that would be Con Edison). However, it is known that the best way to save money on energy is temperature control. Heating and cooling a home or apartment are big items and relatively easy. For example, maintaining the temperature in the winter between 62 (at night) and 66-67 (in the day) degrees can save hundreds for a normal size home. In the summer, not using AC is the best. To keep the house cool, bring down the shades in the day, and then open windows at night. If there is AC, then make sure all doors and windows are tightly sealed to keep in the cool air. Another way is to lower the temperature of the hot water heater and of course take short showers. Use the clothes dryer only when necessary and dry clothes outside. What makes energy costs higher in some states than in others? There are a number of factors that relate to this, but a large part is the resources produced in the state, and policy and taxes. For example, energy in the Midwest (Dakotas, Wyoming, etc.) is cheaper because they have significant fossil fuel resources and they exploit them. In New York, there is a large amount of hydro and nuclear energy, but the energy costs are high due to taxes. Are tax deductions and credits effective at incentivizing households to be more energy efficient? They can be. The main aspect here is to do a calculation on payback period. Typically, if the payback period is less than 7 years, it is worth getting some energy efficient appliances and making other modifications to the house. In addition, the deductions and credits need to be stable and predictable. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? This is more of a political issue, and more related to what government should and should not provide. Will recent regulatory changes made by the Trump administration bring coal back? I am not sure of this. The main impact on coal was the increase in availability and lower price of natural gas. Emission rules do play a role, but the main driver is the cost and availability of a fuel. Natural gas is a great fuel because it is easy to transport and store, and it burns cleanly in the sense that there is no ash, and very little particulate matter is formed. This makes the maintenance on the combustion systems and air pollution control systems easier. Kenneth B. Medlock III James A. Baker III and Susan G. Baker Fellow in Energy and Resource Economics & Senior Director of the Center for Energy Studies at Baker Institute for Public Policy, and Director of the Masters in Energy Economics Program at Rice University 
What are some good tips for saving money on energy bills? These are actually rooted in simple changes in behavior that do not require any financial outlay or capital investment. They include things like a one or two degree change on the thermostat, and turning off lights, computers, radios and TVs when exiting a room. Other small changes can be effective as well, but require an expense be incurred. These include changing to LED lighting (which impacts electricity usage for lighting, but also reduces ambient heat from lighting), upgrading windows and insulation, making sure proper weather stripping is installed to reduce drafts, buying more efficient appliances, etc. In some places, various state and local programs can help offset the costs associated with some of these suggestions. Finally, discuss with your electricity provider what programs may be in place to help raise efficiency and reduce energy use. What makes energy costs higher in some states than in others? Energy costs are influenced by many things. These include the nature of regulation, the amount of infrastructure that is needed to reliably deliver energy, the existence of constraints that impact the ability to deliver energy, and the type of fuels used to generate electricity. In areas with vertically integrated utility monopolies, limited ability to wheel energy into a service area from neighboring regions, and a high reliance on higher cost fuels will generally have higher energy/electricity prices. Are tax deductions and credits effective at incentivizing households to be more energy efficient? The State of California has effectively used these types of incentives to mitigate demand growth. So, these can be effective, but there is no guarantee of it. There needs to be general social acceptance of the programs initiated. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? Low income assistance programs are admirable. If administered correctly, they provide significant welfare enhancement. Not clear if there is a singular best mechanism, other than to say that the verification of the beneficiary’s income is vital. Will recent regulatory changes made by the Trump administration bring coal back? Not likely. Coal was losing market due to economics, not regulation. The simple truth is that natural gas has been relatively cheap. Joshua P. Fershée Associate Dean for Faculty Research & Development, Professor of Law, and Director of the Master of Law Program in the Center for Energy & Sustainable Development at West Virginia University College of Law 
What are some good tips for saving money on energy bills? Managing energy consumption is the key, and can be relatively painless. Investing in a thermostat that adjusts heat and air conditioning when no one is home is a good start. Reducing heat when washing clothes and dishes and using shorter washes when the longer cycles are not needed can also assist in reducing energy bills. Good air flow in a home or apartment is important, and clean air filters will help air conditioning systems run more efficiently, as will leaving vents and doors open. People often think they can close doors or vents, but that tends to make the unit work harder. Adding ceiling fans, switching to LED lights, and adding dimmer switches can also help. What makes energy costs higher in some states than in others? Energy costs vary from state to state for a variety of reasons. The main issues that cause prices to vary by locality are related to demand for electricity, the availability of generation plants and generation fuels, the cost of fuel in the state, infrastructure (transmission and distribution lines), and state utility structure (including pricing regulations). States with less expensive and diverse fuel sources (e.g., hydro, coal, natural gas, wind) tend to have lower costs than states with few natural resources. Are tax deductions and credits effective at incentivizing households to be more energy efficient? Tax credits and deductions can be effective in motivating consumers, manufacturers, and builders to make households more efficient. The least effective incentives are those that reward consumers for doing something they planned to do anyway, such as replacing old windows. Such incentives should be designed to support and motivate early adoption of more efficient technologies, and should reward adopting higher levels of efficiency (rather than modest increases). Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? Yes, governmental support for low-income households is essential to maintaining the health and safety of our most vulnerable citizens, especially senior citizens and children. Some households in poverty spend as much as 25% or even 40% of their income on energy, when about 6% of household income to energy is generally considered affordable. The most effective way to facilitate such a program is to provide direct rebates or funds to eligible households. Funding via utilities can miss eligible households. Will recent regulatory changes made by the Trump administration bring coal back? No. The problem with the Trump administration’s plans to support coal country is that rolling back EPA regulations on coal often has the effect of rolling back regulations that impact the natural gas industry as well, meaning that even as coal gets cheaper, so does natural gas. Further, there is talk in the administration about opening up more federal lands to coal mining, and oil and gas exploration (this would be a Department of Interior action, not Energy). This move, too, is curious, as it is hard to see how increased access to more supply is going to move up prices to support the struggling industries. A greater supply of oil, gas or coal will lead to even lower prices for each resource. Lower taxes and reduced regulations means a lower cost of exploration and production, which leads to more of the resources and lower prices. Absent a commitment to increasing the cost of natural gas, coal is simply not going to compete. As I have written previously: Coal production in my home state of West Virginia has declined from the peak of 158 million short tons in 2008, down to 95 million in 2015, with further decline expected for 2016. And the state is feeling the devastating effect of lost jobs -- West Virginia was the only state in 2015-2016 to lose a statistically significant number of jobs. Tax revenues are down dramatically, and that decline, too, is expected to continue. The harm to the state of these lost jobs is real, but there is no reasonable governmental policy that could change this decline, even if we wanted it to. The reality is that natural gas is a cheaper option, it has long-term potential to work alongside renewables, and no energy proposal from any major candidate has suggested a proposal that would help coal take back market share from natural gas (despite promises to simply bring back coal jobs). Living in West Virginia, a place I love to live in, it is easy to want hope. We need hope, and we need a plan, but that plan has to include educating our workforce and expanding economic opportunities in other industries, not harkening back to another time that will never return. The reality is that the war on coal is not one that can be won. In the end, as a pricing problem, trying to win the war on coal is really trying to win a war on math. It just can't happen. The numbers don't add up. Inara Scott Assistant Professor in the College of Business at Oregon State University 
What are some good tips for saving money on energy bills? There are lots of easy things that consumers can do to save money, like turning out lights that aren’t being used, switching to high-efficiency light bulbs, and setting the thermostat to turn down the heat or reduce the air conditioning when you aren’t at home. There are also more elaborate, but important things you can do, like adding insulation, sealing leaky ducts, and replacing old appliances. Consumers should make sure to check with their local utility for more energy efficiency tips and programs. Often, they can get a rebate from the utility for engaging in an energy efficiency program. What makes energy costs higher in some states than in others? There are many factors that influence the cost of electricity in an individual state. The main driver is the type of power plants and the fuel used to produce the electricity. In the Pacific Northwest, we enjoy lower energy costs in large part because of the presence of hydroelectric facilities on the Columbia River. States like Texas and Wyoming, which produce a large amount of energy from wind and coal, enjoy lower costs because the cost of the power production is lower. If you’re in a region that is dependent on more expensive fuels, like oil, you may see higher prices, as is the case in Hawaii. There are also costs associated with getting the fuel where it needs to go, like building pipelines to carry natural gas or using trains to transport coal. Some fuels, like natural gas, are also vulnerable to price adjustment spikes when demand is high, which can drive up costs for electricity as well. There are also costs due to regulations, such as regulations on emissions from power plants. Whether the state has a fully regulated electric industry can also affect prices. Are tax deductions and credits effective at incentivizing households to be more energy efficient? It depends on how the deductions or tax credits are structured. Today, energy efficiency rebates offered by utilities are usually subject to intensive measurement and verification systems at the state level, to make sure they are effective in creating new energy savings. Government programs, like the Energy Star program, are particularly effective in both reducing energy use and saving consumers money. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? I do think we should find ways to help low-income households, who are paying a disproportionately high percentage of their monthly income to energy bills, including many older Americans who are on fixed incomes. Direct assistance may be necessary in the short term to keep the lights on or the heat on, but I think we need to invest in structural improvements to reduce energy use in the long run. While middle and upper income households may have the money to finance a weatherization project or replace an appliance, this may be impossible for low-income folks. Also, many households that rent their homes aren't eligible for energy efficiency programs. I think these are important issues to address in order to resolve inequalities going forward. Will recent regulatory changes made by the Trump administration bring coal back? Many people think that regulations have caused the decline in the coal industry, but larger, more important forces at work are the low cost of natural gas, and the rapidly declining costs of renewable resources, including wind and solar. In addition, countries all over the world, including India and China, are focusing on the development of renewable resources instead of coal, because of the threat of climate change and the health risks from pollution from coal-fired plants. Unfortunately, there really isn't a way to preserve these coal mining jobs in the face of these long term changes. Instead, I think we need to focus on how to help these vulnerable communities and people, through job retraining and diversifying their community's resources beyond dependence on coal mining. Howard A. Learner Executive Director of the Environmental Law & Policy Center & Adjunct Professor at the Northwestern University School of Law and the University of Michigan Law School 
What are some good tips for saving money on energy bills?
- Look for the Energy Star label when buying new appliances and equipment. In almost all cases, that will save you money over time.
- Switch to highly energy efficient LED lights that now come in a broad range of sizes, spectrums and styles, and are dimmable. Replace your incandescent and CFL bulbs to save money on your energy bills and avoid pollution at the same time.
- Install new smart thermostats and other energy management controls that enable you to be more energy efficient for heating and cooling your home, and turn off lights and appliances when you’re not home or not using them. New, reasonably priced technologies work fairly easily, and can save you money on energy bills by avoiding wasted energy.
- Look for energy efficiency incentives offered by your local electric and gas utilities and other vendors. Many are offering discounts and rebates for purchases of energy efficient furnaces, air conditioners, smart thermostats, appliances and LED lights.
- Look for favorable rate incentives offered by your utilities to, for example, allow your central air conditioner to be remotely turned off (“cycled”) for an hour or two during peak electricity demand times. Save money without much inconvenience and help hold down costly energy peak prices.
- Solar energy technologies are rapidly improving, costs are declining, and the economics are increasingly favorable for use on houses and multifamily buildings in many parts of the country. Installing solar energy panels -- supported by both current federal and many states’ incentives -- is good for energy bill savings, good for the environment, good for American energy independence and good for job creation.
- Turn off your lights and set your thermostat at an appropriate level when you’re not home. Save money and avoid wasting energy.
What are some good tips for saving money on energy bills? There are two types of options: behavioral and technological. Behavioral changes include turning lights off when not needed, and keeping the thermostat down in the winter and up in the summer. Technologically, it's economically efficient now to switch out all incandescent bulbs with LEDs. Bigger fixes include wall and attic insulation, more efficient HVAC, attic fans, and double-paned windows. But property owners should first conduct an energy audit to find out where they may be "leaking" energy. Some of these fixes can be quick and easy with huge upsides, such as holes in ducts. What makes energy costs higher in some states than in others? I think it boils down mostly to the cost of electricity generation, including the fuels used, and how many facilities are needed to meet demand, as well as the cost of the infrastructure to deliver the energy. But note that price and costs are two different things. For example, California has high electricity rates but pays relatively little in energy, because the state is more efficient with its energy use. Part of that may be related to the mostly benign climate here. Are tax deductions and credits effective at incentivizing households to be more energy efficient? These credits and incentives have had some success, but not enough to meet our long-term efficiency goals. And we're still leaving a lot of cost-effective improvements on the table. We need a better approach, such as replicating the "solar lease" with no money down option that really spurred fast adoption of solar panels using capital market funds. We could do the same thing for energy efficiency improvements if we could more accurately and reliably quantify the actual energy saved. Then we could develop robust pay-for-performance programs that would attract large-scale capital investment. And at some point, we may need to require energy upgrades when properties change hands or tenants. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? Definitely yes. Energy savings provide badly needed cash savings for low-income households, although it gets tricky if the ratepayer qualifies for energy subsidies already. The best option may be subsidized financing for retrofits, such as a low or no interest revolving loan fund. Will recent regulatory changes made by the Trump administration bring coal back? Coal has decreased primarily because of increased competition from low-cost natural gas and some renewables. Regulatory changes are unlikely to reverse the market dynamic, although lifting pollution controls on coal-fired power plants and coal mining, as the Trump administration has proposed, may help make coal cheaper and therefore more competitive. Still, many of these regulatory rollbacks will face years of litigation, and may lose in court. So I don't think there's much the administration can do just through regulation to bring coal back. David B. Spence Professor of Business, Government and Society in the McCombs School of Business & Professor of Law in the School of Law at the University of Texas at Austin 
What are some good tips for saving money on energy bills? Of course, the best tip is to use less energy. Insulation, caulking and other simple energy saving devices can help, and more sophisticated systems can manage your energy use through a central programmable device. And in some states, the price of energy varies during the time of day, and so you can save money by shifting high energy uses to off-peak periods in those places. What makes energy costs higher in some states than in others? Different parts of the country have different energy mixes: that is, different fuels that make up the energy mix. Relative fuel prices change over time. For example, there is a constraint on the delivery of natural gas to New England, and in winter, driving the price of natural gas upward. That also results in increases in the price of electricity from natural gas at those times. Are tax deductions and credits effective at incentivizing households to be more energy efficient? Yes. They don't necessarily induce huge investments, but sometimes, they do. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? Yes. Changes happening in the electricity sector may increase prices for consumers, particularly lower-income consumers. So low-income energy assistance is more important than ever. David M. Driesen University Professor at Syracuse University College of Law 
What are some good tips for saving money on energy bills? Buy energy efficient appliances, add insulation and energy saving windows, and turn off stuff you are not using. Program your thermostat to avoid wasting energy when you are not there. You can also choose your energy provider in many states, which can offer an opportunity to lower costs. What makes energy costs higher in some states than in others? Energy is often cheapest where states have low cost renewable options, like abundant hydropower. Some states have supported nuclear power, which is very expensive. Are tax deductions and credits effective at incentivizing households to be more energy efficient? They help. But they work best when coupled with significant investment in public education and outreach. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? It should continue to provide energy assistance to low-income households, which reduces poverty while helping public health. A multi-pronged approach is best, and involving community organizations in program design and promotion is critical. Will recent regulatory changes made by the Trump administration bring coal back? No. Competition from natural gas and renewables will continue to put pressure on the coal industry. Also, the Trump administration supports mountaintop removal, which facilitates firing coal miners while destroying the environment. Blake Hudson Professor of Law at the University of Houston Law Center 
What are some good tips for saving money on energy bills? This may sound obvious, but I think just being more aware is the first step. Making conscious choices to turn the thermostat up when you leave the house during the summer, to turn lights off when you are not in a room, unplugging chargers when they are not in use, etc. Upgrading to more energy efficient products is another important step. This does not mean that you should just immediately throw away all of your light bulbs and scrap your current washer and dryer -- because both your current products and new products have their own environmental and energy footprint when they are manufactured. So it could very well be worse environmentally to scrap perfectly good appliances, for example, and to purchase new ones (from an aggregated societal consumption standpoint -- though programs do exist to take energy inefficient appliances and recycle them, which helps with the waste stream issue). But when your products fail or need replacing, investing in more energy efficient products is best. Even if there are more up-front costs, over time these are neutralized by energy bill savings. What makes energy costs higher in some states than in others? There are a wide range of factors, many of which relate to utility rate regulation, limits on or access to competition, and other utility regulations that vary from state to state. Geography and time of year matters as well -- when the price of gas fluctuates, cold-weather states will see more price swings during the winter months, when heating is needed. The same holds true in warm weather states during the summer, depending on the price and energy mix that goes into electricity generation (and the use of air conditioners). Are tax deductions and credits effective at incentivizing households to be more energy efficient? If structured properly, these programs can be effective, though various studies draw different conclusions. There is another way to look at this question, however -- incentivizing energy producing companies to invest in renewables and cleaner burning fuels takes the consumer out of the picture. And we have more evidence that these incentives work. The fossil fuel industry has benefited from tax deductions and credits for a long time (many of which are permanent parts of the tax code, which are incredibly difficult to remove). If we can more adequately incentivize (through the use of these policies) a shift toward renewable generation, then even if consumers are not being energy efficient, the environmental impact is reduced and energy is saved (a href=http://ift.tt/2sORKpS>theoretically, if you leave the lights on all day in your 100% solar powered home, are you wasting any energy?). Obviously, we need improvements in storage of renewably generated electricity, and major changes in the grid and overall energy infrastructure to be able to move more quickly toward renewable generation (solar, wind, geothermal, biofuels like wood pellets). Not to mention changes in law. But these incentives do appear to have sped up the transition, which has increasingly seen solar and wind become more competitive with fossil fuels, even in the absence of subsidies. Back to homeowners, about a decade ago there was a behavioral science study that asked what was most effective at getting households to be more energy efficient. The study’s authors told different households different things regarding the effects of lowering their energy bills -- you can be a better citizen, a better steward of the environment, you can save $X amount of money, or you can do better than your neighbors. Which one worked? Telling people that they were doing worse than, or that they could do better than their neighbors. So competition worked better than telling people they would save money. There is a lesson here about how to best incentivize household energy efficiency. Do you believe the government should continue to provide energy assistance to low-income households? If so, what’s the best way? I do. I think one of the most effective ways is not to just provide tax breaks or subsidies, but to develop programs that result in direct installations -- of solar panels, smart meters or other technologies that result in lower energy bills for low-income communities. One people group who have a great need for assistance are Native American tribes -- the number of homes without electricity is startling (the Navajo tribal utility authority projects that 32% of Navajo homes do not have electricity). There are obviously other groups who need help, but this is one of which, I think, people are not adequately aware. Will recent regulatory changes made by the Trump administration bring coal back? All signs and studies point to: no. Market forces (cheap natural gas) are the primary driver of the shift away from coal. The regulations put into place by the Obama administration may very well have made it harder for coal to ever get back up if market forces shift again, but the market is the predominant factor in coal going by the wayside. And I think with the widespread global support of the Paris Agreement, and growing concern (at least abroad) over climate change, coal has a hard road ahead of it in the next 50 years. Auriane Koster Adjunct Professor in the School of Sustainability at Arizona State University 
What are some good tips for saving money on energy bills? There are lots of easy ways to save energy. You can increase the temperature in the summer, or decrease it in the winter, a degree or two. Keep blinds closed during the summer months in the afternoon. Keep lights and electronics off when you are not using them. Unplug all items to avoid vampire energy. Don’t turn all of your larger appliances on at the same time, to reduce demand load. Be sure not to waste water; turn off the sink when brushing your teeth and washing your hands. Allow 24 hours to defrost, rather than placing it in water. Replace light bulbs with LEDs. Be sure all appliances are Energy Star certified. What makes energy costs higher in some states than in others? Different utility companies have different demand and usage charges. Also, some states have added taxes, such as an environmental tax. Some utilities also allow you to add a slight fee to your bill to increase the utility company's renewable energy portfolio share. Are tax deductions and credits effective at incentivizing households to be more energy efficient? These are useful, especially when wanting to add or change technology. For example, tax deductions and credits can incentivize people to implement solar panels on their homes. These deductions/credits can also incentivize people to update older appliances to Energy Star appliances and/or to change out lightbulbs.
Methodology
In order to determine the most and least energy-expensive states, WalletHub’s analysts compared the average monthly energy bills in each of the 50 states and the District of Columbia using the following equation:
(Average Monthly Consumption of Electricity * Average Retail Price of Electricity) + (Average Monthly Consumption of Natural Gas * Average Residential Price of Natural Gas) + (Average Monthly Consumption of Home Heating Oil * Average Residential Price of Home Heating Oil) + (Average Motor-Fuel Price * (Miles Traveled/Average Motor-Fuel Consumption/Number of Drivers in the State)) = Average Monthly Energy Bill in the State
Sources: Data used to create this ranking were collected from the U.S. Energy Information Administration, Federal Highway Administration, Environmental Protection Agency and AAA’s Daily Fuel Gauge Report.
from Wallet HubWallet Hub
via Finance Xpress
0 comments