A new data mapping project from the Kentucky Energy and Environment Cabinet highlights the disparities in income and electricity prices both around the country and in the commonwealth.The Kentucky Department of Energy Development and Independencetook median household income data from the American Community Survey, and combined that with federal Energy Information Administration data on electricity prices. The result is a national heat map that shows the areas where residents devote more of their household income to paying their electric bills.
In the map, swaths of red mark much of the south, including most of Kentucky. Despite having some of the lowest electricity rates in the nation, the data suggests many residents spend more than four percent of their household income on their electricity bills.Aron Patrick, DEDI’s assistant director, said higher electric bills weren’t surprising in the South during the summer. But the same can be seen during the winter months. Through Central Appalachia, residents spend more of their income on electricity. That's partly because a high number of homes use electric heat, and many homes lack insulation and other energy-saving measures.
And in Kentucky, the data shows that some areas of the state—mostly in the east—residents pay anywhere from 7.7 percent to 14.8 percent of their income for electricity.
The project also examined the data by neighborhood in Jefferson and Fayette counties. There, because residents use the same utilities and pay the same rates, the maps essentially map the cities by income. In Louisville, electricity bills suck up a higher percentage of income for residents living closer to downtown and in West and Southwest Louisville.
The data isn’t perfect, because it just includes money spent on electricity. So, if your home is heated by natural gas or propane, those costs aren’t included. But Energy and Environment Cabinet Secretary Len Peters said seeing this data—and how the state’s low-income residents will be affected by inevitable electricity price increases—shows areas that need more attention.He said one of the solutions is energy efficiency. Older manufactured homes in particular are energy sieves. But most low-income families don’t have the thousands of dollars needed to add insulation, replace leaky windows and doors and upgrade old, energy-sucking appliances.“So, it is an issue that is very relevant to all of us, but is particularly relevant to a low-income individual,” Peters said. “So, it really becomes a social policy issue of what do you do, and how do you approach this?”And there’s no easy answer. Peters said there are some places where utility companies essentially loan ratepayers money for energy efficiency upgrades, which they pay back with savings from reduced energy costs. Another possibility is the Low Income Home Energy Assistance Program, which pays electricity bills for low-income families.“[LIHEAP is] needed, but really that’s a Band-Aid for the symptom and not a cure,” he said. What we should be doing is, not abandoning that program, but we should be increasing the amount of money we’re putting in for weatherization of those residences, so they won’t need the LIHEAP money five years from now.”Though electricity costs aren’t uniform across Kentucky, right now the state has the second-lowest residential electricity costs in the nation (second to hydropower-powered Washington). That’s because of the commonwealth’s dependence on coal. But coal-fired electricity is already getting more expensive, and will continue to do so as reserves decline and federal environmental laws go into effect.And this is why the cabinet has been talking a lot about diversification. Peters said that’s one over-arching solution to help keep Kentucky’s energy prices low, and avoid placing even more of a burden on the state’s low-income families.“So that if one particular type of electricity is going to be more expensive, and you have enough capacity, you can shift to the lower cost,” he said. “If it’s going to be natural gas now, or coal tomorrow, or what is the role for nuclear, how do we bring renewables into play, etc. it really is a diverse portfolio, so you can hedge.”
