High Gas Prices Put American Families and Businesses at Risk
The wholesale price for gas has increased a staggering 525% since the depths of the Covid-19 pandemic, and the higher cost is slamming homes and businesses through sharp increases in their electricity and gas utilities bills. Bank of America estimates average utility payments rose 16% in August 2022 from the year prior. For families that heat their homes with gas, about half of U.S. households, the coming winter could be especially painful with gas heating bills estimated to jump 34%.
The spike in home energy costs has become a key driver of inflation, and it will force millions of Americans this winter to choose between heat, food, and medication. One in three American households already experience extreme difficulty in paying their utility bills, and Black and brown Americans face the greatest adverse impacts, because they spend a larger portion of their income on energy bills and are confronted with disproportionately greater risks of utility disconnection.
Gas Exports Send Domestic Prices Even Higher
The United States has quickly become the world’s top gas exporter. A side effect of this development is that domestic gas prices are now linked to the global gas market — where gas typically is many times more expensive. Prices in Europe and other international markets spiked to record highs in 2022 as Russia’s war against Ukraine created energy and geopolitical insecurity across the globe.
The growing demand for gas exports has drained U.S. supplies and been a primary contributor to the jump in domestic prices. While fossil fuel companies are generating huge profits off exports, rising energy bills increase the energy burden for families and exacerbate inequality.
Wall Street Wants to Limit Gas Drilling to Boost Profits
While households struggle to pay their bills, U.S. drillers are raking in all-time record profits off the energy crisis that has resulted from Russia’s ongoing war in Ukraine. Rather than work to alleviate tight supplies, the industry has responded to investors' calls to restrain growth to keep prices high and instead used the windfall to spend billions buying back their own stock to reward shareholders.
Fossil fuel boosters spent the past decade trying to hype gas as abundant and cheap, but today’s high prices expose the reality that fossil fuels are expensive, volatile, and risky. A recent survey revealed that even oil and gas executives now believe that the era of inexpensive gas has come to an end. In contrast, prices for renewable energy, already cheap, continue to steadily decrease.
American Families Can Avoid High Gas Prices with Electrification
A transition to high efficiency electric appliances protects households from the next gas price spike. Replacing fossil fuel furnaces and water heaters with clean electric alternatives can lower costs for 103 million of America’s 121 million homes, with total savings of more than $37 billion, according to analysis from Rewiring America.
Instead of helping consumers manage increasingly volatile fuel prices, though, the gas industry has waged secretive campaigns to block improvements to the nation’s building codes and strip local governments of their authority to build better buildings.