The Biden administration is starting off the new year by distributing an additional $4.5 billon in funds to assist low-income Americans with home heating costs. The funding -- released Friday, January 7, 2022 -- is part of last year's $1.9 trillion American Rescue Plan Coronavirus relief package. As we deal with another winter plagued by COVID-19 scares, homeowners are still struggling with absurdly high heating costs.
This boost more than doubled the normal funding level of the Low Income Home Energy Assistance Program (LIHEAP) and will be distributed on a state-by-state basis, with cold-weather states receiving larger shares. According to an article by the Philadelphia Inquirer, "these funds represent the largest appropriation in a single year since the program was established in 1981."
The state allocation breakdown shows the clear difference in funding for states with colder weather and higher heating costs. For example, Texas received $283.9 million while New York, with a population of less than 20 million people compared with Texas' 29 million, received just under $876 million. Pennsylvania received $480.5 million, and New Jersey received $285.6 million in federal funding.
According to the Energy Information Administration, residential heating oil prices are up about 40 percent from a year ago. In similar fashion, electricity and natural gas prices are around 11 percent higher than a year ago, according to the Labor Department's consumer price index. On the brighter side, the extent of the heating oil increase has plateaued in recent months, as wholesale heating oil prices are roughly where they were at the start of October.
The president also announced agreements from seven major utility companies to guarantee no shutoffs for customers who need assistance. They agreed to identify and notify those eligible for government aid, too. Atlantic City Electric, Baltimore Gas and Electric, ComEd, Delmarva Power, Pacific Gas & Electric, PECO, and Pepco were among those who joined the seven other companies that made the commitment in November: DTE Energy, Eversource, Green Mountain Power, National Grid, NorthWestern Energy, Portland General Electric, and Vermont Gas, as well as the trade association NEFI.
Between the companies' commitments and the increased funding, the shock of increased energy costs is supposed to be mitigated. However, Republican lawmakers believe the overall relief package has caused higher levels of inflation by pumping too much money into the economy. Regardless, this plan is already in action and will hopefully provide the anticipated -- and much needed -- relief for homeowners.
