The burden of paying utility bills, particularly for electricity, is a monthly challenge for numerous Americans, many of whom struggle to meet these expenses.
A recent report from LendingTree reveals that the nationwide average cost for electricity in August was $185.59. However, it highlights significant disparities across different states, with some residents facing substantially larger monthly bills.
The five states with the highest average electricity costs reported figures ranging from 21.6% to 37.1% above the national mean, according to the analysis.
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LendingTree’s assessment of monthly electricity expenses utilized data sourced from the Energy Information Administration (EIA).
According to their findings, the states with the most substantial average electricity bills in August were as follows:
Connecticut: $254.47
Arizona: $252.60
Texas: $233.38
Hawaii: $230.80
Alabama: $225.65
LendingTree emphasizes that “usage matters,” indicating that while some states may have elevated rates per kilowatt-hour, they can also have lower average monthly bills, and vice versa.
Utility bills a major pain point for some Americans
The revealing findings regarding electricity costs come amid a broader context where 23.4% of Americans reported facing challenges in fully paying their energy bills, according to Census Bureau Household Pulse Survey data.
This figure witnessed a year-over-year increase of 1.4 percentage points.
“Despite recent moderation in inflation, the high costs of living continue to burden many, making it difficult for some to meet their financial obligations,” noted Matt Schulz, chief credit analyst at LendingTree. “Many individuals are forced to make tough choices to maintain their utilities.”
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Data from the Bureau of Labor Statistics reveals that overall inflation, as gauged by the Consumer Price Index, rose by 0.3% month-over-month and 2.7% year-over-year in November.
Electricity costs saw a slight month-over-month decline of 0.4%, yet remain 3.1% higher than a year ago, while prices for utility gas services increased by 1% from October and 1.8% from November 2023, according to CPI data.
As a result of the high cost of utilities, 34.3% of Americans reported having to reduce or forgo spending on essential items at least once during the past year, LendingTree adds.
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The Bureau of Labor Statistics noted that American households incurred an average of $77,280 in total expenditures in 2023, translating to approximately $6,440 monthly.
