As Americans recognize Earth Day, consumers may have noticed one effect of climate change: Higher temperatures around the U.S. are straining their budgets, and in some cases even forcing families to choose between cooling their homes and buying groceries.
More intense heat is driving higher energy consumption, with over half of U.S. counties facing potentially higher utility and other related costs, the Bank of America Institute found in a recent analysis of its customers' spending patterns. As of March, customers' total monthly utility bills, including, water, gas and electricity, averaged nearly $300 — up roughly 25% compared with 2019.
Bank of America used aggregated and anonymized customer data to track utility payments and analyze the growth in costs.
Higher temperatures put lower-income households in particular under more financial pressure, with average utility payments for individuals earning less than $50,000 a year rising 38% between March 2019 and March 2024.
Financial Strain Continues for Many Americans Despite Decrease in Pandemic
Higher utility costs are just one expense that Americans have grappled with since inflation began surging during the pandemic. And while the disease has relented, many consumers remain under severe financial pressure. Some 38% of households with incomes under $50,000 say they were unable to pay a bill or to pay it in full at least once over the past 12 months, according to recent Census data.
Indeed, while air conditioning has gone from a luxury to a necessity, not all Americans can afford to run their units.
"We know that some people won't turn them on because they're afraid of the bill," Mark Wolfe, executive director of National Energy Assistance Directors' Association, told CBS MoneyWatch.
Outdated Approaches to Heat Waves Falling Short
At the same time, old-school approaches to coping with heat waves are no longer adequate, experts said. Cooling centers, which can alleviate discomfort during a short-lived stretch of hot weather, are less effective now that heat waves often last much longer than one or two days, Wolfe explained.
"That model doesn't work. You can't have people moving into library for a week — it's a model from decades ago," he said.
According to Michael Mendéz, a climate change researcher and assistant professor at University of California, Irvine, many communities across the country are experiencing extreme temperatures for up to 10 months a year.
Mendéz pointed out that this prolonged heat is leading to higher utility bills as individuals try to maintain a comfortable living environment. This is especially challenging for those on fixed or lower incomes who are forced to choose between cooling their homes and buying groceries. The impact of these high utility bills is significant, affecting households' ability to afford basic necessities like food.
