LIHEAP's Purchasing Power to Decline This Winter

December 21, 2012 -- The higher cost of home heating this winter could have a significant impact on the purchasing power of LIHEAP, according to a recent analysis by the National Energy Assistance Director's Association (NEADA).

The purchasing power of LIHEAP is linked to the cost of home heating, which the U.S. Energy Information Administration (EIA) has predicted will reach a record high this winter. In October, the EIA predicted the average cost of home heating oil will increase from $2,087 last winter to $2,494 (19 percent) this winter; natural gas from $608 to $697 (15 percent); propane from $1,962 to $2,222 (13 percent); and electricity from $902 to $951 (5 percent). The overall increases are expected not because of higher fuel prices but primarily from an expected return to "normal" colder temperatures this winter.

NEADA has projected that LIHEAP's purchasing power will decline from 46 percent of the cost of home energy during the 2011-12 winter heating season to 38 percent in 2012-13. Additionally, for the coming winter heating season, NEADA has projected that the average LIHEAP benefit will decline from about $405 to $375 as a result of expected increases in the number of households receiving assistance due to the higher cost of winter heating and the continuing weak economy.

NEADA's analysis (below) shows LIHEAP's purchasing power for the past three winters and also details home heating costs by fuel for those years.

Source: NEADA