Nebraska Energy Burden Study

2013 UpdateThe Second Annual Nebraska-Western IowaSymposium on Homelessness

August 7, 2013 Kearney, NE

Jerry DeichertCenter for Public Affairs ResearchUniversity of Nebraska at Omaha

jdeicher@unomaha.edu 402-554-2134

www.unomaha.edu/cpar www.facebook.com/unocpar

Why Look at Energy Burden?

• Roger Colton of Fisher, Sheehan, and Colton advocates that the maximum affordable level of energy expenditures for the average household should be about 6% of income

• Defining Affordable Level of Energy Expenditures– Moderate Shelter Burden = 30% of income

– Median residential energy costs for low income households = 20% of shelter costs

– Affordable residential energy burden = 30% * 20% = 6% of income

Actions Taken Because of High Energy Bills: 2008 Statewide Survey

Was there ever a time during the past 12 months when you had to take any of the following actions due to your energy bills?

0.0

0.7

1.0

1.3

2.0

2.2

2.3

4.1

4.6

4.8

5.7

7.8

7.8

7.9

8.7

8.9

10.7

16.6

16.9

46.6

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0

Moved into a shelter or was homeless

Left home home due to CO fire caused by unsafe heating/lighting

Moved in with friends or family

Kept home at a temperature that you felt was unsafe or unhealthy

Was evicted from home or apartment

Went without showers or baths because no hot water

Went without hot meals because no cooking fuel

Went without food for at least one day

Threaten with disconnection or fuel deliveries

Didn't make full rent or mortgage payment

Borrowed from a friend or relative to pay home energy bill

Used your kitchen stove or oven to provide heat

Went without medical/dental care

Left home for part of the day because it was too hot or too cold

Skipped payment on your home energy bill or paid less than whole bill

Closed off part of your home because you could not afford it

Used candles or lanterns because you didn't have lights

Worried that you wouldn't be able to pay your home energy bill

Kept your home at a temperature that you thought was uncomfortable

Reduced your expenses for basic household necessities

Percent Saying Yes

Nebraska Energy Burden Study: 2013 Update

• The purpose of this study is to update the estimates of the energy burden of households in Nebraska that were developed in 2009.

• This study reviews information for the 2009-2011 period.

• Previous studies analyzed information for the 2008-2010, 2007-2009, 2006-2008, and 2005-2007 periods.

Data Source

• Main Data Source:• U.S. Census Bureau, American Community

Survey, Three-Year Public Use Microdata Sample: 2005-2007 through 2009-2011

• Energy Burden Data Elements• Household income• Cost of electricity• Cost of gas• Cost of oil, kerosene or wood

• Housing Cost Data Elements• Selected monthly owner costs • Gross rent

Important Concepts Used in the Study

• Energy Expenditures• Selected Monthly Owner Costs • Gross Rent• Energy Burden• Affordable Level of Energy

Expenditures (Defined Earlier)• Energy Gap

Energy Expenditures

• Energy expenditures are the total energy bills paid by a household

• They take into consideration both the price of energy as well as the amount of energy consumed.

• They are recorded if paid by or billed to occupants, a welfare agency, relatives, or friends. However, for a few households, some or all of their energy costs are paid by landlords, included in the rent payment, or included in condominium or cooperative fees. Therefore data in this study are for households where no energy costs are included in rent.

Selected Monthly Owner Costs • Selected monthly owner costs provide

information on the housing cost expenses for owner occupied units.

• Selected owner costs are the sum of payments for mortgages, deeds of trust, contracts to purchase, or similar debts on the property; real estate taxes; fire, hazard, and flood insurance on the property; utilities; and fuels. It also includes, where appropriate, the condominium fee for condominiums and mobile home costs.

• When the data are used in conjunction with income data, the information offers an excellent measure of housing affordability and excessive shelter costs.

Gross Rent

• Gross rent is the contract rent plus the estimated cost of utilities and fuels if these are paid by the renter (or paid for the renter by someone else).

• Gross rent provides information on the monthly housing cost expenses for renters. When the data are used in conjunction with income data, the information offers an excellent measure of housing affordability and excessive shelter costs.

Energy Burden

• Energy burden may be defined as the percentage of annual household income that is used to pay annual energy bills

• Energy burden = (Annual Energy Bill) / (Annual Income) * 100 percent

Energy Gap

• Energy gap is defined as the difference between the affordable level of energy expenditures (6% of income) and actual energy expenditures

Energy Expenditures By Income

• In general, annual energy expenditures are slightly lower for households with lower incomes, but the energy burden is substantially higher.

• For Nebraska households with incomes less than $10,000 in 2009-2011

• Average annual energy expenditures were $1,923

• Average energy burdens were 45.9%

Table 1. Energy Burden by Income Group for Households Where No Energy Expenses Are Included in Rent for Nebraska: 2005-2007 to 2009-2011

Income Group

Time periodLess than $10,000

$10,000 to $19,999

$20,000 to $29,999

$30,000 to $39,999

$40,000 or more

All households

Mean annual energy expenditures

2005-07 $1,944 $1,918 $1,954 $2,041 $2,350 $2,197

2006-08 $1,988 $2,014 $2,053 $2,139 $2,473 $2,317

2007-09 $1,875 $1,984 $2,000 $2,126 $2,439 $2,273

2008-10 $1,845 $2,024 $2,055 $2,153 $2,472 $2,310

2009-11 $1,923 $2,086 $2,096 $2,162 $2,522 $2,358

Mean annual household income

2005-07 $5,629 $15,125 $24,915 $34,658 $86,646 $60,914

2006-08 $5,445 $15,008 $24,945 $34,833 $89,175 $64,036

2007-09 $5,510 $15,197 $25,096 $34,855 $88,882 $62,927

2008-10 $5,237 $14,873 $24,852 $34,701 $89,989 $64,181

2009-11 $5,115 $15,026 $24,904 $34,713 $93,224 $66,532

Mean energy expenditures as a percent of household income

2005-07 42.5 13.2 8.0 5.9 3.2 7.4

2006-08 44.5 14.0 8.3 6.2 3.3 7.4

2007-09 43.4 13.6 8.1 6.1 3.3 7.5

2008-10 45.1 14.1 8.4 6.2 3.4 7.5

2009-11 45.9 14.3 8.5 6.3 3.3 7.5

Less than $10,000 $10,000 to $19,999 $20,000 to $29,999 $30,000 to $39,999 $40,000 or more All households$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$1,923

$2,086 $2,096$2,162

$2,522

$2,358

Figure 1. Mean Annual Energy Expenditures by Income for Nebraska Households Where No Energy Expenses Are Included in Rent for 2009-2011

Income Level

Mea

n A

nn

ual

En

erg

y E

xpen

dit

ure

s

Less than $10,000 $10,000 to $19,999 $20,000 to $29,999 $30,000 to $39,999 $40,000 or more All households0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

45.9

14.3

8.5

6.3

3.3

7.5

Figure 2. Mean Energy Burden by Income for Nebraska Households Where No Energy Expenses Are Included in Rent for 2009-2011

Income Level

Mea

n E

ner

gy

Bu

rden

(P

erce

nt)

Less than $10,000 $10,000 to $19,999 $20,000 to $29,999 $30,000 to $39,999 $40,000 or more All households-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

-3.3

3.6

2.1

1.1

2.01.8

Figure 3. Percentage Change in Mean Annual Energy Expenditures by Income for Nebraska Households Where No Energy Expenses Are Included in Rent for 2006-2008 to 2009-2011

Income Level

Per

cen

tag

e C

han

ge

Less than $10,000

$10,000 to $19,999

$20,000 to $29,999

$30,000 to $39,999

$40,000 or $49,999

$50,000 to $59,999

$60,000 to $69,999

$70,000 to $79,999

$80,000 to $89,999

$90,000 to $99,999

$100,000 or more

Total$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000

$7,363 $7,108$7,911

$9,475$9,992

$11,270$12,096

$13,554$14,296

$14,705

$19,235

$12,830

Figure A1. Mean Annual Selected Owner Costs by Income for Nebraska Households for 2009-2011

Income Level

Mea

n A

nn

ual

Sel

ecte

d O

wn

er C

ost

s

Less than $10,000

$10,000 to $19,999

$20,000 to $29,999

$30,000 to $39,999

$40,000 or $49,999

$50,000 to $59,999

$60,000 to $69,999

$70,000 to $79,999

$80,000 to $89,999

$90,000 to $99,999

$100,000 or more

Total$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000

$7,036$7,643

$8,510 $8,733

$9,588 $9,717$10,218

$11,190$11,521

$10,781

$13,264

$9,017

Figure A2. Mean Annual Gross Rents by Income for Nebraska Households Where No Energy Expenses Are Included in Rent for 2009-2011

Income Level

Mea

n A

nn

ual

Gro

ss R

ents

Less than $10,000

$10,000 to $19,999

$20,000 to $29,999

$30,000 to $39,999

$40,000 or $49,999

$50,000 to $59,999

$60,000 to $69,999

$70,000 to $79,999

$80,000 to $89,999

$90,000 to $99,999

$100,000 or more

Total0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

44.943.4

37.5

33.2

31.1

28.1

26.3

24.0 23.422.6

19.6

28.1

Figure A3. Mean Energy Expenditures as a Percent of Selected Owner Costs by Income for Nebraska Households for 2009-2011

Income Level

En

erg

y as

a P

erce

nt

of

Sel

ecte

d O

wn

er C

ost

s

Less than $10,000

$10,000 to $19,999

$20,000 to $29,999

$30,000 to $39,999

$40,000 or $49,999

$50,000 to $59,999

$60,000 to $69,999

$70,000 to $79,999

$80,000 to $89,999

$90,000 to $99,999

$100,000 or more

Total0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

23.4 23.021.8

19.421.0 20.7

18.119.2

20.3

23.0

19.521.2

Figure A4. Mean Energy Expenditures as a Percent of Gross Rents by Income for Nebraska Households Where No Energy Expenses Are Included in Rent for 2009-

2011

Income Level

En

erg

y as

a P

erce

nt

of

Gro

ss R

ents

Table 2. Energy Expenditures and Burdens by Relation of Income to Poverty for Nebraska Households Where No Energy Expenses Are Included in Rent: 2009-2011

Ratio of income to poverty

Annual energy expenditures

(mean)

Energy expenditures as a percent of

household income (mean)

Number of

households

Under 100% $2,125 29.7 70,296

Under 125% $2,135 24.1 102,272

Under 150% $2,173 21.0 132,826

Under 200% $2,210 16.9 193,333

Map 1. Nebraska Regions

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000

$2,551

$2,407

$2,644

$2,579

$2,475

$2,669

$2,060

$1,787

$2,273

$2,443

$2,166

$2,475

$2,383

$2,301

$2,358

Figure 4. Mean Annual Energy Expenditures by Area in Nebraska for Households Where No Energy Expenditures Are Included in Rent for 2009-

2011

Mean Annual Energy Expenditures

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

$0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000

$61,648

$61,663

$57,166

$60,389

$58,493

$54,871

$83,392

$50,993

$82,149

$69,428

$54,081

$50,685

$88,646

$84,277

$66,532

Figure 5. Mean Annual Income by Area in Nebraska for Households Where No Energy Expenses Are Included in Rent for 2009-2011

Mean annual household income

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

0.0 2.0 4.0 6.0 8.0 10.0 12.0

8.5

8.1

8.6

8.0

8.1

9.9

4.8

8.7

4.7

6.8

9.4

10.8

5.1

6.1

7.5

Figure 6. Mean Annual Energy Burden by Area in Nebraska for Households Where No Energy Expenses Are Included in Rent: 2009-2011

Energy Burden (Mean energy expenditures as a percent of household income)

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

-6.0 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0

6.7

3.9

4.1

3.9

3.3

4.5

0.5

-2.4

3.7

4.2

-3.0

-5.4

-1.9

1.6

1.8

Figure 7. Percentage Change in Mean Annual Energy Expenditures by Area in Nebraska for Households Where No Energy Expenses Are Included in Rent for 2006-2008 to 2009-2011

Percent

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000

$9,912

$9,977

$9,524

$10,339

$9,602

$9,610

$16,391

$12,193

$17,063

$13,488

$11,838

$11,330

$17,768

$17,750

$12,829

Figure A5. Mean Annual Selected Owner Costs by Area in Nebraska for Households for 2009-2011

Mean Annual Selected Owner Costs

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000

$7,279

$8,290

$7,426

$7,989

$7,430

$7,389

$9,897

$8,324

$10,959

$8,534

$9,538

$9,689

$11,002

$10,731

$9,017

Figure A6. Mean Annual Gross Rents by Area in Nebraska for Households Where No Energy Expenses Are Included in Rent for 2009-2011

Mean Annual Gross Rents

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0

35.9

33.5

37.6

34.7

35.9

38.2

18.4

22.8

18.6

26.0

26.5

29.0

19.1

19.3

28.1

Figure A7. Mean Energy Expenditures as a Percent of Selected Owner Costs by Area in Nebraska for Households for 2009-2011

Energy as a Percent of Selected Owner Costs

Southeast Nebraska

South Central Nebraska

Southwest Nebraska

Central Nebraska

Northeast Nebraska

Northwest Nebraska

Greater Nebraska

South Lancaster Co.

North Lancaster Co.

Urban Sarpy Co.

Exurban Omaha

Southeast Douglas Co.

Northeast Douglas Co.

Southwest Douglas Co.

Northwest Douglas Co.

Omaha-Lincoln Area

All households

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0

28.2

24.9

30.1

27.1

27.4

30.3

15.1

17.2

15.7

22.7

19.5

24.7

13.8

15.1

21.2

Figure A8. Mean Energy Expenditures as a Percent of Gross Rents byArea in Nebraska for Households Where No Energy Expenses Are Included in Rent for 2009-2011

Energy as a Percent of Gross Rents

For 2009-2011, some of the highest mean annual energy burdens are for households that:

Have incomes below $30,000 or below 200 percent of poverty

Are linguistically isolated

Live in a rental housing unit

Live in a housing unit that is owned free and clear

Consist of families with female householder with no spouse present

Consist of persons living alone, especially single women

Have no children under 18 years living in the household

Have exactly one person 60 years or older living in the household

Have exactly one person 65 years or older living in the household

Live in housing units with 6 or fewer rooms

Heat with a fuel other than electricity or utility gas

Live in a house built prior to1950

• Live in Greater Nebraska, Eastern Douglas County, or North Lancaster County

Energy Gap

• Energy gap is defined as the difference between the affordable level of energy expenditures (6% of income) and actual energy expenditures

Less than $10,000 $10,000 to $19,999 $20,000 to $29,999 $30,000 to $39,999 $40,000 or more Nebraska total0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.094.4

86.8

64.1

45.3

9.8

32.0

Figure 8. Percentage of Households Paying Six Percent or More of Their Incomes for Energy by Income Group: 2009-2011

Income Group

Pe

rce

nt

2005-2007 2006-2008 2007-2009 2008-2010 2009-201130.0

30.5

31.0

31.5

32.0

32.5

33.0

33.5

34.0

33.2 33.2

32.6 32.7

32.0

Figure 9. Percentage of Households Paying Six Percent or More of Their Incomes for Energy: 2005-2007 through 2009-2011

Pe

rce

nt

2005-2007 2006-2008 2007-2009 2008-2010 2009-2011$250.0

$255.0

$260.0

$265.0

$270.0

$275.0

$280.0

$285.0

$290.0

$259.6

$273.2

$269.4

$278.5

$287.6

Figure 10. Size of the Energy Gap: 2005-2007 through 2009-2011M

illio

ns