The US Federal Government’s Low-Income Home Energy Assistance Program – known by its homely acronym LIHEAP – has proved a durable safety net for vulnerable Americans struggling with energy bills since the early 1980s. But advocates worry efforts to cut natural gas out of the nation’s energy mix as a strategy to meet climate goals could cripple LIHEAP’s ability to combat energy poverty.
In Washington, a town where hyper-partisan politics is the order of the day, there’s at least one thing Republicans and Democrats have been able to agree on for more than 40 years: The federal government has a legitimate role in helping vulnerable Americans who can’t afford to pay their energy bills.
Since 1981, that consensus has sustained the Low-Income Home Energy Assistance Program (LIHEAP), which last year distributed more than $4 billion to help families avoid utility disconnections, weatherize their homes, and pay for emergency repairs or replacement of furnaces and air-conditioning systems.
The program’s impact is significant in a country where one in four Americans say they have been forced to forego basic necessities in order to pay an energy bill. Consider these data points:
LIHEAP’s bill payment assistance program restored power or avoided disconnection for more than 2.7 million American families in FY2023.
In the same year, nearly 61,000 homes were weatherized using program funds, providing improvements in energy efficiency that lowered energy use and bills.
In 2022, the program lifted 34,000 children and 48,000 older Americans out of poverty thanks to energy assistance.
But even at current funding levels, LIHEAP today is able to serve only one in six families who meet the program’s income eligibility requirements, according to Katrina Metzler, executive director for the National Energy and Utility Affordability Coalition (NEUAC), the principal LIHEAP advocacy group.
Although LIHEAP is one of the few federal programs that has seen small increases in funding in recent years, the expiration of pandemic-era emergency funding has put the program in a hole at a time when rising energy costs, extreme weather events and inflation are exacerbating energy insecurity.
“What we’re seeing is a steady increase in applications and an overall decrease in funding available because those emergency resources have faded,” Metzler said. “The families we’re talking about regularly are making choices between medicine or food and paying their utility bill.”
Even so, LIHEAP puts the U.S. well ahead of Canada, which lags other developed economies in low-income energy assistance efforts, according to Abhilash Kantamneni, director of action research for Efficiency Canada, which focuses on energy efficiency as a key to addressing energy affordability.
“There’s a lot to learn from LIHEAP that Canada can do,” Kantamneni said. “Canada is one of the few (developed) countries that doesn’t have an official definition of energy poverty, and there is no energy assistance program at the national level to help low-income households struggling with energy bills.”
Flexibility a key feature
The key to LIHEAP’s effectiveness, say observers, is in the program’s flexibility. Federal funds are appropriated by Congress and distributed to the states, which work with local utilities and community action organizations to find the best ways to get energy assistance to those in need.
In this way, the federal dollars can be combined with a variety of other funding sources – the states themselves, energy assistance programs operated by utilities and funded by donations from their own charitable foundations and customers, and nonprofit fuel funds – to amplify LIHEAP’s impact.
“That’s a very mature role for the federal government to play in being able to elevate the ambition of existing state and local programs – and then providing them the long-term stability of funding so that then they can use it in smart ways to unlock the benefits for households,” Kantamneni said.
LIHEAP funds can be applied to household energy bills regardless of the energy source, so some states include solar as an eligible weatherization option. States can also increase the impact of their LIHEAP dollars by combining them with money from a separate federal weatherization assistance program.
There’s also flexibility in how states can apply LIHEAP funds. In addition to emergency payments, several states use LIHEAP to fund a Percentage of Income Payment Program (PIPP) that pays a percentage of a customer’s utility bills for a year while also working to reduce energy use through efficiency upgrades.
Charlotte, N.C.-based Duke Energy offers a program for LIHEAP-eligible customers that provides a flat on-bill credit for 12 bill cycles while automatically pre-qualifying participants for its weatherization program, said Kevin Alexander, director of vulnerable customer strategy and agency for Duke Energy.
“We’re trying to find ways to get customers into those programs to address the energy efficiency aspect of affordability but also help them today as well,” Alexander said, adding the utility has launched a new initiative in North Carolina to improve its ability to connect more customers with energy assistance programs.
Similar bill assistance and on-bill credit programs are available in Canada, such as the Ontario Energy Board’s ratepayer-funded Low-Income Energy Assistance Program (LEAP) and the taxpayer-funded Ontario Electricity Support Program (OESP), said Harneet Panesar, chief operating officer for the OEB.
The big difference, of course, is that Canada currently has no federal program to augment provincial energy affordability efforts. A new program launching in 2025 allocates $800 million to residential energy efficiency retrofits but doesn’t include bill assistance of any kind, Kantamneni said.
“You can’t host enough bake sales at the local level to replace LIHEAP,” said NEUAC’s Metzler. “Four billion dollars is a lot of resources that our federal government infuses into our system to ensure that energy is affordable for everyone. Taking that away and expecting states or local agencies to pick up the burden is not a reasonable approach to ensuring access to energy in our country.”
“It makes a big difference,” Alexander said. “LIHEAP represents the vast majority of funding that’s going to be available at the state and local level and it’s helping out a lot of those agencies who are really trying to support customers in need.”
‘Party doesn’t matter’
Enacted during Ronald Reagan’s first term in response to the energy crisis, recession and rampant inflation of the late 1970s, LIHEAP has survived through five decades, seven administrations, budget cuts and a pandemic. Observers credit the bipartisan support advocates have built over the years.
“I think one of the reasons the program has survived when a lot of programs have not is because it’s bipartisan,” said NEUAC’s Metzler. “No matter which side of the aisle in Congress you sit on, you’re able to see the benefit to your district and the constituents in your district of programs like these that help maintain family and community stability and provide for health and safety concerns in the community.”
NEUAC’s membership hints at the breadth and diversity of partners involved in supporting LIHEAP: Utility trade associations and utilities themselves, groups representing delivered fuels like propane, grassroots nonprofits, faith-based charities and state and local agencies that manage energy affordability programs.
In addition to organizing LIHEAP Action Day, its flagship advocacy event that brings hundreds of supporters to Capitol Hill every year, NEUAC also plays a key role in making sure the coalition’s 300-plus members are working effectively together to benefit the maximum number of households possible.
One of NEUAC’s core functions is educating member organizations and other stakeholders to ensure they know how to connect customers in need with LIHEAP resources. With funding help from the American Gas Association (AGA), NEUAC created an interactive map that makes information easily accessible.
With a full-time staff of only two, NEUAC relies on its utility partners to raise awareness of LIHEAP. Duke Energy and its Piedmont Natural Gas unit, for example, communicate to their customers about LIHEAP and their own programs, Share the Light and Share the Warmth, through their websites, bill inserts, community events and other platforms.
Brian Caudill, managing director of government affairs and public policy for the AGA, credits the strength of the coalition for LIHEAP’s success in garnering “plus-ups” – funding increases – over the last few years even as appropriations bills containing the funding were being routinely cut.
“As long as we have the advocacy in place and we can be able to make the message resonate with our policymakers and show the benefits of the program nationwide, then the program will be increasingly better funded,” Caudill said. “Party doesn’t matter, and party surely doesn’t matter to somebody who’s without heat in the middle of January.”
Transition’s looming challenge
Despite the program’s success, LIHEAP advocates worry that energy security could become unattainable for even more Americans if the transition to a clean-energy economy pushes policymakers to double down on electrification and take affordable natural gas out of the nation’s energy mix.
Natural gas provides heat for 60% of American homes, and households that use natural gas save an estimated $1,132 per year compared to an all-electric home, according to the AGA. Losing that price advantage and the financial burden of switching from natural gas to electric concerns NEUAC’s Metzler.
“I don’t have expertise about electrification, but what I know about is the impact that we can discern that it would have on households,” Metzler said. “To that end, it’s imperative that we address the affordability needs of those families when we talk about forced electrification.”
The AGA’s Caudill points out greenhouse gas emissions from the natural gas distribution system have declined 70% since 1990 and continue to drop as the industry decarbonizes through investments in infrastructure, lower-carbon fuels such as renewable natural gas and hydrogen, and stepped-up energy efficiency programs.
“Why would we eliminate the most cost-effective heat for people in need, especially considering the indispensable role natural gas can play in reducing greenhouse gas emissions?”
– Brian Caudill, managing director of government affairs and public policy for the AGA
“Why would we eliminate the most cost-effective heat for people in need, especially considering the indispensable role natural gas can play in reducing economywide greenhouse gas emissions?” Caudill asks. “These are some of the things that we are constantly noodling on and trying to address on the Hill.”
Efficiency Canada’s Kantamneni suggests the cost implications of total electrification highlight the need to ensure a community’s lowest-income residents are not also living in the least energy-efficient homes – an energy affordability goal embedded in climate policies in the United Kingdom, he says.
LIHEAP advocates would prefer to stay in their lane and focus on the health-and-safety message that has won hearts and minds on Capitol Hill since 1981. But as pressure to meet climate goals ratchets up, they and America’s most vulnerable clearly have a huge stake in the debate over how that transition unfolds.
David Coburn is a strategic thinker, writer, media relations expert and communications consultant leveraging 30-plus years of print journalism and agency public relations experience.