Cold winters cause of higher energy costs, not electric or gasoline

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Cold winters cause of higher energy costs, not electric or gasoline

Fri, 02/09/2018 - 4:35am -- tim

Vermont Business Magazine In the US, 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 one lives and how much energy one uses are a big part of the equation, according to WalletHub, a national credit information firm. 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. Vermont ranks 10th overall in energy dollars consumed, but this is not due to relatively high electricity and gasoline prices; it's because of our cold winters. Vermont ranks relatively low in total electric and gasoline consumption due to frugality and conservation, and because of the short summers.

The average after-tax income of the two lowest income quintiles, representing 51 million households, is $19,719 (US Bureau of Labor Statistics’ Consumer Expenditure Survey for the period from July 2014 to June 2015. Each income quintile represents approximately 25 million American households.) This is equivalent to a take-home income of less than $1,700 per month. Residential electricity and motor gasoline are the largest energy expenditures for households in all income quintiles. Households in the very lowest income quintile spend 22 percent of their after-tax income on residential utilities and gasoline, while households in the two lowest quintiles spend 17 percent. This compares with 5 percent for households in the top income quintile.

To better understand the impact of energy on  finances relative to location and consumption habits, WalletHub’s analysts compared the total monthly energy bills in each of the 50 states and the District of Columbia.

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)

*No. 1 = Most Energy-Expensive

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. WalletHub