1 Energy Poverty and Household Wellbeing Atlantic City Electric / Delmarva Power Agency Summit October 5, 2005 Donnell Butler David Carroll Carrie-Ann Ferraro

2 Organization of Presentation Introduction – 5 minutes State Analysis – 20 minutes Metropolitan Area Discussion – 5 minutes Local Area Analysis – 10 minutes Indicators of Wellbeing – 10 minutes Conclusion – 5 minutes Questions / Feedback – 5 minutes

3 Purpose of the Presentation Furnish information about the energy needs of low-income households in DE, NJ, MD, and VA to policymakers and program managers Explore the linkages among energy poverty and household wellbeing Demonstrate how existing data sources can be used to obtain useful information for policy formulation and program design

4 State Level Analysis Methodology

5 State Information Needs Policymakers and program managers need: –State-level cross-sectional data to understand current status for households in the state –State-level longitudinal data to understand trends for households in the state –National-level data to understand how those state-level energy needs compare to households nationwide

6 State-Level Data Sources 2000 Census Public-Use Microdata (PUMS) –Data available includes: Household Demographics: income and poverty level, presence of vulnerable members, race and ethnicity, languages spoken, household composition, employment, income program participation Housing Unit Characteristics: age of unit, unit type, home ownership Energy Data: Main heating fuel, energy expenditures

7 State-Level Data Sources Current Population Survey, Annual Social and Economic Supplement (ASEC) –Statistical variances are too large for a single ASEC annual file to allow for a useful analysis for a single state. –Three-year average of 2002, 2003, and 2004 data used to estimate the FY 2003 LIHEAP eligible population –Data available includes: Household Demographics: income and poverty level, presence of vulnerable members, race and ethnicity, household composition, employment, income program participation

8 Definitions LIHEAP Eligible/Low Income – Each state can set their own household income cutoff between 110% of the poverty level and the greater of 150% of the poverty level or 60% of state median income Delaware – 200% of HHS Poverty Guidelines New Jersey – 175% of HHS Poverty Guidelines Maryland – 150% of HHS Poverty Guidelines Virginia – 130% of HHS Poverty Guidelines Source: LIHEAP Clearinghouse State Fact Sheets

9 Definitions Energy Burden – Direct energy expenditures as a share of gross money income Energy Gap – Difference between client energy burden and any target burden

10 Limitations Maximum Income Standard – Federal maximum income standard covers at least 50% more households Renters – About 15% of households pay for part or all of their energy through their rental payments Update – Information not updated for recent increases in energy prices and poverty

11 State Level Analysis Findings

12 Number of Households Percent of All DE Households LIHEAP Eligible Households, , % LIHEAP Eligible Households, , % Delaware LIHEAP Eligible Households (2000 and 2003) 1 Source: 2000 Decennial Census PUMS 5 Percent Sample. 2 Source: Three-year Average of the CPS ASEC Delaware LIHEAP Eligible Population

13 Number of Households Percent of All MD Households LIHEAP Eligible Households, , % LIHEAP Eligible Households, , % Maryland LIHEAP Eligible Households (2000 and 2003) 1 Source: 2000 Decennial Census PUMS 5 Percent Sample. 2 Source: Three-year Average of the CPS ASEC Maryland LIHEAP Eligible Population

14 Number of Households Percent of All NJ Households LIHEAP Eligible Households, , % LIHEAP Eligible Households, , % New Jersey LIHEAP Eligible Households (2000 and 2003) 1 Source: 2000 Decennial Census PUMS 5 Percent Sample. 2 Source: Three-year Average of the CPS ASEC New Jersey LIHEAP Eligible Population

15 Number of Households Percent of All VA Households LIHEAP Eligible Households, , % LIHEAP Eligible Households, , % Virginia LIHEAP Eligible Households (2000 and 2003) 1 Source: 2000 Decennial Census PUMS 5 Percent Sample. 2 Source: Three-year Average of the CPS ASEC Virginia LIHEAP Eligible Population

16 Number in DE Number in MD Number in NJ Number in VA LIHEAP Eligible Households 1 68,705294,926646,192364,985 LIHEAP Recipient Households 2 13,27780,608154,64597,778 Recipients as Percentage of Eligible Households 19.3%27.3%23.9%26.8% State LIHEAP Eligible and Recipient Households (2003) 1 Source: Three-year Average of the CPS ASEC Source: LIHEAP Household Reports FY 2004 (Heating). State LIHEAP Recipient Population

17 Energy Burden Percent of total household income spent on total residential energy. At the national level, the median residential energy burden was 3 percent for all households and 10 percent for all low-income households in 2003.

18 Delaware LIHEAP Eligible Energy Burden Energy Burden for Delaware LIHEAP Eligible Households (1999) Source: 2000 Decennial Census PUMS 5 Percent Sample.

19 Maryland LIHEAP Eligible Energy Burden Energy Burden for Maryland LIHEAP Eligible Households (1999) Source: 2000 Decennial Census PUMS 5 Percent Sample.

20 New Jersey LIHEAP Eligible Energy Burden Energy Burden for New Jersey LIHEAP Eligible Households (1999) Source: 2000 Decennial Census PUMS 5 Percent Sample.

21 Virginia LIHEAP Eligible Energy Burden Energy Burden for Virginia LIHEAP Eligible Households (1999) Source: 2000 Decennial Census PUMS 5 Percent Sample.

22 Energy Gap The dollar amount needed to reduce a customer’s energy burden to an amount equal to a specified energy burden percentage. At the national level, about $4.9 billion dollars in energy assistance would have been needed to ensure that no low-income household spent more than 15% of income on residential energy in The amount required to reduce residential energy bills to 25% of income was $2.7 billion.

23 Delaware LIHEAP Eligible Energy Gap Energy Gap for Delaware LIHEAP Eligible Households (1999) Number of Households Energy Gap (in Millions) Households with Energy Burdens Greater than 5% 47,740$ 52 M Households with Energy Burdens Greater than 10% 31,103$ 29 M Households with Energy Burdens Greater than 25% 11,286$ 10 M Source: 2000 Decennial Census PUMS 5 Percent Sample.

24 Maryland LIHEAP Eligible Energy Gap Energy Gap for Maryland LIHEAP Eligible Households (1999) Number of Households Energy Gap (in Millions) Households with Energy Burdens Greater than 5% 181,687$ 199 M Households with Energy Burdens Greater than 10% 136,109$ 131 M Households with Energy Burdens Greater than 25% 62,935$ 60 M Source: 2000 Decennial Census PUMS 5 Percent Sample.

25 New Jersey LIHEAP Eligible Energy Gap Energy Gap for New Jersey LIHEAP Eligible Households (1999) Number of Households Energy Gap (in Millions) Households with Energy Burdens Greater than 5% 345,296$ 406 M Households with Energy Burdens Greater than 10% 247,843$ 257 M Households with Energy Burdens Greater than 25% 109,890$ 110 M Source: 2000 Decennial Census PUMS 5 Percent Sample.

26 Virginia LIHEAP Eligible Energy Gap Energy Gap for Virginia LIHEAP Eligible Households (1999) Number of Households Energy Gap (in Millions) Households with Energy Burdens Greater than 5% 274,578$ 278 M Households with Energy Burdens Greater than 10% 208,273$ 184 M Households with Energy Burdens Greater than 25% 89,216$ 81 M Source: 2000 Decennial Census PUMS 5 Percent Sample.

27 Delaware Energy Assistance Energy Gap (in Millions) 1 FY ’04 LIHEAP Benefits 2 FY ’04 Supplement Resources 3 Shortfall Households with Energy Burdens Greater than 5% $ 52 M$ 5 M$ 1 M$ 46 M Households with Energy Burdens Greater than 10% $ 29 M$ 5 M$ 1 M$ 23 M Households with Energy Burdens Greater than 25% $ 10 M$ 5 M$ 1 M$ 4 M Decennial Census PUMS 5 Percent Sample. 2 FY 2004 LIHEAP Grantee Survey for FY LIHEAP Clearinghouse:

28 Maryland Energy Assistance Energy Gap (in Millions) 1 FY ’04 LIHEAP Benefits 2 FY ’04 Supplement Resources 3 Shortfall Households with Energy Burdens Greater than 5% $ 199 M$ 30 M$ 48 M$ 121 M Households with Energy Burdens Greater than 10% $ 131 M$ 30 M$ 48 M$ 54 M Households with Energy Burdens Greater than 25% $ 60 M$ 30 M$ 48 M($ 17) M Decennial Census PUMS 5 Percent Sample. 2 FY 2004 LIHEAP Grantee Survey for FY LIHEAP Clearinghouse:

29 New Jersey Energy Assistance Energy Gap (in Millions) 1 FY ’04 LIHEAP Benefits 2 FY ’04 Supplement Resources 3 Shortfall Households with Energy Burdens Greater than 5% $ 406 M$ 72 M$ 175 M$ 159 M Households with Energy Burdens Greater than 10% $ 257 M$ 72 M$ 175 M$ 9 M Households with Energy Burdens Greater than 25% $ 110 M$ 72 M$ 175 M($ 137) M Decennial Census PUMS 5 Percent Sample. 2 FY 2004 LIHEAP Grantee Survey for FY LIHEAP Clearinghouse:

30 Virginia Energy Assistance Energy Gap (in Millions) 1 FY ’04 LIHEAP Benefits 2 FY ’04 Supplement Resources 3 Shortfall Households with Energy Burdens Greater than 5% $ 278 M$ 36 M$ 2 M$ 239 M Households with Energy Burdens Greater than 10% $ 184 M$ 36 M$ 2 M$ 145 M Households with Energy Burdens Greater than 25% $ 81 M$ 36 M$ 2 M$ 42 M Decennial Census PUMS 5 Percent Sample. 2 FY 2004 LIHEAP Grantee Survey for FY LIHEAP Clearinghouse:

31 Across all states –Increases in LIHEAP eligible population –LIHEAP participation rate below 28% of eligible population –Approximately half of LIHEAP eligible have energy burdens greater than 10 percent. –Combination of federal and state-level funds not enough to ensure that no LIHEAP eligible household spends more than 10% of income on energy. State LIHEAP Eligible Summary of Findings

32 Metropolitan Area Discussion Methodology

33 Metropolitan Area Information Needs Metropolitan area policymakers & program managers need: –Information related to demographic characteristics and energy needs of low-income households –Information on the relationship between energy needs and other low-income needs, including housing, to promote the integration of programs aimed at assisting low-income households

34 Data Sources for Metro Area Analysis American Housing Survey (AHS) Metropolitan Area Samples –Metropolitan Area Samples have sufficient numbers of LIHEAP eligible records –Estimates are not available at the state level from the national AHS sample –Several Metropolitan Areas are surveyed each year on a rotating basis Local MSAs: Baltimore, MD (1998), Norfolk-Virginia Beach- Newport News, VA-NC (1998), Northern NJ PMSAs (2003), Philadelphia, PA-NJ PMSA (2003), Washington, DC-MD-VA MSA (1998)

35 American Housing Survey (AHS), Metropolitan Area Samples (continued) –Data available includes: Household Demographics: income and poverty level, presence of vulnerable members, race and ethnicity, household composition, Energy Data: Main heating fuel, energy expenditures, heating and cooling equipment Housing Unit Characteristics: unit type, home ownership, housing adequacy, housing costs Data Sources for Metro Area Analysis

36 Neighborhood Level Analysis Methodology

37 Neighborhood Information Needs Local program managers need local-level information about the population in their communities in order to: –Effectively implement programs –Target outreach initiatives –Improve integration of energy assistance programs with other programs designed to assist low-income households

38 Neighborhood Data Sources 2000 Census Summary File 3 (SF3) –Data available includes: Household Demographics: income level, age of householder, race and ethnicity, languages spoken, household composition, income program participation Housing Unit Characteristics: age of unit, unit type, home ownership Energy Data: Main heating fuel –Data is limited to entire population; does not offer estimates of LIHEAP eligible population

39 Neighborhood Data Sources 2000 Census Special Tabulations –Estimates of the LIHEAP eligible population can be obtained from the Census Bureau for small areas, including Census Blocks, Block Groups, and Tracts –Data available includes: Household Demographics: income and poverty level, presence of vulnerable members, race and ethnicity, languages spoken, household composition, employment, income program participation Housing Unit Characteristics: age of unit, unit type, home ownership Energy Data: Main heating fuel, energy expenditures

40 Neighborhood Level Analysis Findings

41 Wilmington DE Map

42 Eastside Neighborhood Map

43 Eastside Poverty Level Poverty Level of Eastside in Wilmington, DE Households (1999)

44 Eastside Housing Tenure Housing Tenure: Eastside in Wilmington, DE Households (2000)

45 Eastside Number of Units in Structure Number of Units in Structure: Eastside in Wilmington, DE Households (1999)

46 Eastside Year Structure Built Year Structure Was Built: Eastside in Wilmington, DE Households (1999)

47 Eastside Household Size Household Size: Eastside in Wilmington, DE Households (2000)

48 Eastside Home Heating Fuel Home Heating Fuels Used: Eastside in Wilmington, DE Households (1999)

49 Below 200% of Poverty: North – 52%, Central – 67%, South – 72% Renters: N – 59%, C – 80%, S – 94% Large Multi-unit Structures: N – 6%, C – 51%, S – 52% Built Prior to 1960: N – 81%, C – 32%, S – 36% 4+ person Households: N – 29%, C – 18%, S – 32% Electric Home Heating: N – 21%, C – 34%, S – 67% Eastside LIHEAP Eligible Summary of Findings

50 Indicators of Wellbeing Analysis Methodology

51 Indicators of Wellbeing Data Sources Effects of Energy Poverty on Housing and Household Wellbeing 2003 and 2005 National Energy Assistance Survey of LIHEAP Recipients: –Sponsored by NEADA –Survey instrument is publicly available –Interviewed a nationally representative sample of over 2,000 LIHEAP-recipient households from 20 states, including Delaware –Documented the choices that LIHEAP-recipient households make when faced with unaffordable home energy bills

52 Limitations Survey Response Challenges: –Relying on Respondent Memory –Response bias (e.g., prideful responses) –Inability to control response situation Population –Having received benefits, LIHEAP recipients might be better off than LIHEAP eligible

53 Indicators of Wellbeing Analysis Findings

54 Indicators of Wellbeing Housing Problems Source: 2003 National Energy Assistance Survey. Housing Problems Experienced by DE LIHEAP Recipient Households (2003, 2005)

55 Indicators of Wellbeing Housing Wellbeing Source: 2003 National Energy Assistance Survey. Sacrifices to Wellbeing Experienced by DE LIHEAP Recipient Households (2003, 2005)

56 Indicators of Wellbeing Effects on Health Source: 2003 National Energy Assistance Survey. Health Problems Experienced by DE LIHEAP Recipient Households (2003, 2005)

57 Indicators of Wellbeing Summary of Findings In the last five years, due to their energy bills: –40% of DE respondents in 2003 and 49% in 2005 reported that they missed a rent or mortgage payment –27% of DE respondents in 2005 reported that they went without food for at least one day – 39% of DE respondents in 2003 and 50% in 2005 reported that they went without medical or dental care –20% of DE respondents in 2003 and 31% in 2005 reported that they became sick because their home was too cold

58 Using existing data sources, one can develop a broad array of information about the energy needs of low-income households –All data used for this presentation are publicly available Data is available to explore linkages among energy poverty, housing affordability, and household wellbeing Conclusion

59 Information can be used by: – P olicymakers and program managers to make effective decisions related to program design, operations and evaluation –Agency managers to educate service providers and state officials on the diversity of the low-income population and how different strategies might be needed to achieve positive outcomes for different types of low-income households Conclusion

60 Atlantic City Electric / Delmarva Power –Michael Hoy –Enid Wallace-Simms Wilmington Urban League – Tyrone Jones Thank You

61 Energy Poverty and Household Wellbeing Atlantic City Electric / Delmarva Power Agency Summit October 5, 2005 Donnell Butler David Carroll Carrie-Ann Ferraro Phone: