Oct 16, 2023
The U.S. consumer price index rose 3.7% over the last year. Although the Fed has paused rate hikes for the moment, inflation continues to hit consumers hard.
According to an April 2023 report by the National Energy Assistance Directors Association (NEADA), roughly 20.5 million households in the U.S. are behind on their utility bills. Additionally, the amount of utility consumer debt —the amount consumers owe on their utilities — increased from $15.9 billion in February 2022 to $17.8 billion by February 2023.
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“I expect a tsunami of shutoffs,” Jean Su, a senior attorney at the Center for Biological Diversity, told Bloomberg.
While energy prices decreased 6.4% in March 2023 year-over year, electricity prices in particular rose 10.2% in April year-over-year according to the Bureau of Labor Statistics.
According to Mark Wolfe, executive director of NEADA, the country is “heading towards a period of unaffordable energy prices.” Wolfe called on Congress to act to increase funding to offset increasing prices.
But if you can’t wait on lawmakers for relief, there are small things you can do to lower your energy bill. Every bit counts.
LED lighting
Compared to big household appliances, light bulbs don’t seem like a big deal in terms of energy consumption. But it all adds up.
According to the U.S. Department of Energy, lighting accounts for approximately 15% of an average household’s electricity use.
To lower the lighting portion of your electricity bill, consider LED bulbs. They consume up to 90% less energy than traditional incandescent bulbs and can last up to 25 times longer.
The Department of Energy says by switching to LED lighting, the average household can save about $225 in energy costs per year.
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That said, LED bulbs tend to be more expensive to buy than incandescent bulbs. To get the greatest energy savings, look for LED bulbs that are ENERGY STAR-rated.
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Seal and insulate
It’s going to be an expensive winter according to the U.S. Energy Information Administration. The agency predicts that electric heating costs for homeowners will increase 10%, averaging $1,359 for the 2022/2023 season.
You might want to consider air sealing your house and adding insulation. The U.S. Environmental Protection Agency estimates that by doing so, homeowners can save about 15% on heating and cooling costs, or an average of 11% on their total energy costs.
You can use caulk for cracks and openings around door and window frames. You can also try weatherstripping to seal movable components such as doors and windows.
Line dry your laundry
Some clothes require line drying because it’s more gentle to specific fibers. But the technique can also save you money.
A clothesline obviously costs a lot less than a gas or electric dryer. And it costs even less to operate because it relies on the power of sunlight — which is free.
Project Laundry List — a website that promotes the benefits of line drying — says switching to line drying can reduce your electricity bill by more than $25 per month. Plus, sunlight can work as a natural bleaching agent and disinfectant.
Washing your clothes in cold water can also lead to savings on your energy bill.
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Jing is an investment reporter for Moneywise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.
