The dictionary defines "tool" as a device that provides a mechanical or mental advantage in
accomplishing a task. The Home Energy Affordability Gap certainly qualifies as a tool. The Home Energy
Affordability Gap provides a effective means of communicating the extent to which "actual" home
energy bills exceed "affordable" home energy bills for low-income households .
Just as a hammer can be used to frame a house, attach a roof or hang a picture, the Home Energy Affordability Gap
model and analysis is a tool that can be used for many different purposes. The user can gain different
insights by changing two factors within the model:
- The model can be exercised using different price assumptions for natural gas, electricity, propane
and fuel oil. Analyses have been performed with historical prices, current prices, projected prices
and "what-if" prices.
- Home Energy Affordability Gap data can be aggregated for any geographical area made up of counties
or zipcodes. For example, different clients have requested total Home Energy Affordability Gap data
and analyses for:
• Individual state House and state Senate districts within a state,
• Congressional Districts within a state,
• The service territory of a specific public utility, and
• Census Divisions within the United States.
Browse the following examples to understand how the Home Energy Affordability Gap model and analysis could help you. |
Many times, Congressional representatives and staff want to see what home energy need exists in their
own individual district while assessing their support for LIHEAP. A Home Energy Afordability Gap analysis
can be prepared for individual Congressional districts within a state. back to top
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When state legislatures or utility commissions consider low-income assistance programs, the level of need is
a key question in making budget decisions. The Home Energy Affordability Gap analysis can document that level
of need under varying assumptions of fuel prices, changes in income, and participation rates. back to top
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State officials are required to document and update the standard utility allowance they use to calculate
the "excess shelter deduction" for state Food Stamp programs annually. The Home Energy Affordability
Gap analysis can provide an appropriate updated dollar figure to use each year. back to top
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Similarly, when a natural gas or electric utility expresses an interest in adopting a rate assistance program,
one key question is how much assistance is needed. The Home Energy Affordability Gap analysis can serve as the
basis for deciding per-customer benefit amounts. back to top
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Advocates often argue that existing sources of energy assistance are insufficient, and that additional
funding from states or individual utilities is merited. The Home Energy Affordability Gap analysis can
isolate specific utility territories to determine the total affordability shortfall and provide a basis
to compare that shortfall with existing sources of energy assistance. back to top
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Whether advocating for increased energy assistance funding, or reviewing the impacts on local affordable housing
programs, the Home Energy Affordability Gap analysis helps local officials determine the individual and aggregate
Affordability Gap, as well as the Gap by different levels of Poverty for their specific community.
Local Home Energy Affordability Gap data and analyses can also be used to prepare (or comment upon)
local and state Consolidated Plans. back to top
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When Maryland electric prices increased, and when Michigan gas prices increased, policymakers and advocates
were interested in documenting the impact on low-income households. The Home Energy Affordability Gap allows
for an assessment of individual and aggregate impacts given different levels of price increases. back to top
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When existing energy assistance dollars are distributed, program managers must decide who gets how much.
The Home Energy Affordability Gap analysis can be used to determine where the need lies, by geographic
area, fuel type, and Poverty Level. back to top
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HUD's annual determination of FMRs drives the amount of federal housing assistance (including the energy component
of housing assistance) each year. FMRs are intended to include all shelter costs, including utility costs. The
Home Energy Affordability Gap analysis provides a basis for calculating the annual increase in energy bills
for each geographic area in the country and allows stakeholders to determine how annual increases in energy
prices in their local community, county or region relate to proposed annual changes in their FMRs. back to top
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Community-based service providers must often demonstrate the poverty needs in their community when seeking
either public or private program funding (whether that funding is for energy, housing, food or some other
service). The Home Energy Affordability Gap analysis can help community-based organizations document the
income shortfall given high and increasing energy prices on a state, county or local basis. back to top
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One question frequently faced by energy program administrators is whether to spend money on weatherization or
cash assistance. The Home Energy Affordability Gap analysis allows for a calculation of the impact on the overall
affordability of energy assuming that consumption is reduced by x% through weatherization. This can be compared
to improvements in affordability based on the distribution of cash assistance. back to top
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While many people believe that increasing energy prices result in spiraling rates of utility arrears and,
ultimately, utility service disconnections, there is remarkedly little empirical documentation of this
relationship. The Home Energy Affordability Gap analysis allows stakeholders in any state (or other geographic
area) to empirically document the relationship between arrears, disconnects and changes in Home Energy
Burdens and the total Home Energy Affordability Gap. back to top
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