Energy Insecurity: Lessons from the RECS and SIPP

Energy Insecurity: Lessons from the RECS and SIPP

Ferit UcarDavid Carroll

2012 National Energy and Utility Affordability Conference

June 12, 2012

Introduction

• Home Energy Notebook Special Studies– FY 2008 – LIHEAP Energy Insecurity Study

• Based on 2005 RECS questions

– FY 2009 –SIPP Study of Energy Affordability• Based on 2005 Adult Well-Being Module

• Analysis of Income Dynamics and Assets

• 2009 RECS

2

Outline

• Introduction

• 2005 RECS Findings– Levels and Types of Energy Insecurity – Factors Related to Energy Insecurity

• 2005 SIPP Findings– Analysis of Assets and Income Dynamics

• 2009 RECS Preliminary Findings

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2005 RECS Heating Interruptions

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Reason for Space Heating Disruption

Number of Low Income Households with Space

Heating Disruption

Percent of All Low Income Households

Inability to pay for the repair of broken heating system

1,581,233 4.4%

Inability to pay for bulk fuel delivery

300,284 0.8%

Inability to pay for electric service

1,671,636 4.7%

Inability to pay for natural gas service

621,956 1.7%

Disruption due to any reason 3,265,563 9.1%

2005 RECS Cooling Interruptions

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Reason for Air Conditioning Disruption

Number of Low Income Households with Air

Conditioning Disruption


Inability to pay for the repair of broken air conditioner

1,427,509 4.0%


1,240,278 3.5%

Disruption due to any reason 2,507,547 7.0%

2005 RECS Self-Reports on Impacts of Energy Assistance

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Reason for Heating Interruption

Number of Low Income

Households with Interruption

Number of Low Income Households Energy Assistance Restored Heating


Energy Assistance Restored Heating

Inability to pay for the repair of broken heating system

1,581,233 176,301 11%

Inability to pay for bulk fuel delivery

300,284 103,646 35%


1,671,636 322,077 19%

Inability to pay for natural gas service

621,956 126,034 20%

2005 RECS Financial Dimension of Energy Insecurity

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DimensionAlmost Every

MonthSome Months

1 or 2 Months

Never

Worry about ability to pay

14.9% 23.6% 7.4% 54.1%

Reduce spending for basic necessities

17.0% 23.3% 6.7% 53.0%

Borrow to pay bill 3.9% 11.6% 7.2% 77.3%

Skip paying bill 3.9% 13.0% 9.4% 73.7%Service termination threat

2.7% 8.7% 9.5% 79.2%

Any financial insecurity

23.6% 25.4% 8.9% 42.2%

2005 RECS Health & Safety Dimension of Energy Insecurity

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DimensionAlmost Every

MonthSome

Months1 or 2

MonthsNever

Close off part of home 4.6% 6.4% 2.4% 86.6%

Keep home at unsafe temperature

1.8% 4.1% 2.5% 91.6%

Leave home for part of the day

1.0% 4.2% 3.6% 91.2%

Use stove or oven for heat

0.7% 4.9% 4.5% 89.9%

Any health or safety insecurity

6.3% 12.4% 7.3% 74.0%

2005 RECS Energy Insecurity by Census Region

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Type of Energy InsecurityCensus Region

U.S.Northeast Midwest South West

Heating Interruption 6.9% 6.5% 10.3% 13.4% 9.2%

Cooling Interruption 2.9% 6.2% 12.7% 9.3% 8.7%


39.0% 49.3% 49.5% 48.2%47.0%


5.7% 8.5% 10.1% 7.7% 8.4%

2005 RECS Energy Insecurity by Poverty Guidelines

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Type of Energy InsecurityPoverty Group

≤100% >100%-150% >150%

Heating Interruption 12.9% 7.0% 5.5%

Cooling Interruption 10.1% 8.6% 6.1%


52.7% 45.8% 37.9%

Keep home at unsafe temperature 12.1% 6.3% 4.4%

2005 RECS Energy Insecurity by Demographic Group*

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Type of Energy InsecurityDemographic Group

Young Child Elderly Other




55.8% 47.5% 55.3%

Keep home at unsafe temperature 9.3% 14.5% 11.6%

*Households with income at or below 100% of HHS poverty guidelines

2005 RECS Energy Insecurity by Energy Burden

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Type of Energy InsecurityResidential Energy Burden*

High

Burden≥10.9%

Moderate

6.5%≤Burden<10.9%

Low

Burden<6.5%




51.1% 49.0% 40.4%


11.7% 8.9% 5.2%

2005 RECS Multivariate Factor Analysis

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FindingTabular Analysis

Multivariate Analysis

Lower income Higher rate

Higher burden Higher rate

Northeast Lower rate

Elderly Lower financial rate

Elderly Lower health and safety rate

Survey of Income and Program Participation (SIPP)

• Administered by Census Bureau

• Core Content and Topical Modules

• 2005 Adult Well-Being Module– Questions on energy service disruptions and

bill payment problems

• Assets and Liabilities Module

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2005 SIPPEnergy Insecurity by Demographic Group

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2005 SIPPDemographic Group

Young Child Elderly Other

Bill Payment Problems 29.0% 7.3% 24.5%

Service Disconnections 6.1% 0.8% 4.3%

2005 SIPPAnalysis of Income Dynamics and Assets

• Why do elderly households experience lower levels of financial energy insecurity?– Possession of more assets?– More stable income?

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2005 SIPPAnalysis of Assets

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GroupElderly Low Income

HouseholdsNon-Elderly Low Income

Households

Bill Payment Problem

Service Disconnection

# HHs(in millions)

Avg. Net Worth*

# HHs(in millions)

Avg. Net Worth*

No No 10.0$146,598

14.9 $77,047

Yes No 0.7 $51,816 4.2 $19,434

Yes Yes 0.1 $55,989 1.0 $41,522

*Net Worth=Total Assets-Total Unsecured Debt

2005 SIPPAnalysis of Income DynamicsNon-Elderly More Likely to Have Volatile Income

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Low Income Households with Volatile Income

Group # (in millions) %

Elderly 3.8 33.9%

Non-Elderly 13.7 69.0%

2005 SIPPMultivariate Analysis ofIncome Dynamics and Assets

• Elderly less likely to have bill payment problems

• Elderly less likely to have service shutoffs

• Income dynamics and assets partially explain this

• Still unexplained difference between elderly and non-elderly

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2009 RECSPreliminary Results

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Health and Safety ProblemNumber of Low Income

Households with the Problem


Kept home at unsafe temperature

5,677,244 16.0%

Medical attention needed b/c home too cold

966,327 2.7%

Medical attention needed b/c home too hot

102,786 0.3%

Fire started as a result of using an alternate heating source

96,148 0.3%

Fire started as a result of using an alternate lighting source

39,442 0.1%

Contact

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Ferit [email protected]

David [email protected]

Energy Insecurity: Lessons from the RECS and SIPP

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