Demand for utilities is high in Iowa as inflationary pressures meet cold weather

In February 2022, snow falls over the Cedar River in southeast Cedar Rapids. (Jim Slosiarek/The Gazette)

CEDAR RAPIDS — Cold temperatures and snow have already made their way to Iowa this month, and local and state organizations know demand for utilities will be high as a cold winter meets inflationary pressures.

In the United States, many households will spend as much as they can on heating bills over the last 25 years.

The spending forecast is the result of higher fuel prices coupled with higher heating demand due to projected colder weather this winter, according to the US Energy Information Administration’s annual winter fuel outlook. Russia’s invasion of Ukraine has made the market even tighter.

According to US government data, US households could face an average electric bill of $1,359 this winter, the highest since at least 1997.

J’Nae Peterman, Waypoint’s director of housing services, said that Linn County, like the rest of the country, is experiencing a housing crisis.

“The majority of our community — renters or homeowners — is struggling,” Peterman said. “Keeping up on bills is a struggle, especially during the holiday season. People try their best to do things with their families during the holidays, so people risk sacrificing a payment. It will be difficult for families to stay on budget this winter.”

Waypoint doesn’t provide direct support to utility companies, but it does connect customers with other organizations — like the Hawkeye Area Community Action Program, or HACAP — that do. However, Waypoint recognizes that there is a need for supply support based on the number of people in its housing utility, connecting people to a housing resource or helping them find additional employment. Waypoint serves Linn, Benton and Jones counties.

“We’ve gone from 3,000 to 13,000 in our housing services program in the last two years,” Peterman said.

Serving Benton, Dubuque, Delaware, Iowa, Jackson, Johnson, Jones, Linn and Washington counties, HACAP provides direct supply support. The number of households seeking help has increased in recent years.

In 2020, 7,781 households applied for the energy assistance program. Last year there were 11,922. So far this year – at the beginning of November – almost 4,000 households have applied. Last winter, HACAP provided $11 million in energy assistance in eastern Iowa.

The Energy Assistance Program is designed to help low-income families meet heating bills and pays a portion of heating bills for eligible households. In most cases, the discount takes the form of a credit on the heating bill from the energy supplier.

People who need help can apply directly on the HACAP website at hacap.org/energyconservation. There are also paper applications.

“The pandemic has really been a time mark for many things, and all of our services have seen increased need everywhere,” said Chris Ackman, the organization’s communications and volunteers manager. “Now we have the inflation problem. The moral of the story is that it hasn’t gotten any easier for low-income families. It’s just gotten harder, or at best it’s still hard.”

Energy assistance is also available at the state and federal levels through the Iowa Department of Human Rights. Bill Marquess, the head of the Energy Assistance Office, said his department expects increased demand this winter.

“We’re looking forward to another tough winter,” Marquess said. “That will be expensive”

The Low-Income Home Energy Assistance Program is a federally funded program that requires a one-time payment to the heating utility and is distributed at the state level. Applying for the program also grants the applicant moratorium protection, which prevents an interruption in power supply during the winter.

Marquess said needs so far this year are at the same level as last year, when about 80,000 Iowa homes were supported.

“I think inflation was a big factor in that. Households need to be more careful about where they invest their limited income. They have to choose between buying groceries and buying medicines, and there isn’t enough for everyone,” Marquess said. “We too are still seeing the effects of the pandemic and climate change is also a reality. We go from summer straight into winter without a big fall and that affects the time frame.”

Normal funding from the Department of Energy Assistance is typically around $55 million. However, over the past two years it has had $78 million in funding from the American Rescue Plan Act, allowing the department to make additional payments to anyone who received assistance. In addition, the crisis limits for furnace repairs have been increased.

As of this year, the department has approximately $50 million, plus approximately $1 million from the bipartisan Infrastructure Act and approximately $9 million from the Emergency Security Supplemental Appropriations Act.

All applications and eligibility are made through local Community Action Agencies, which can be found on the Iowa Department of Human Rights website at humanrights.iowa.gov.

“We’re trying to make it as easy as possible to take care of everything,” Marquess said. “Payments are also made to the utility through the municipal action agencies.”

Comments: (319) 398-8255; [email protected]

Source