Issues Of The Environment: Addressing Energy Poverty And Finding Sustainable Solutions

Jul 7, 2021

Dr. Tony Reames, assistant professor at the University of Michigan School for Environment and Sustainability.
Credit University of Michigan School for Environment and Sustainability / seas.umich.edu

Energy poverty is a problem all too many low-income households have to contend with. While more affluent households leave a bigger carbon footprint, it is usually people of color that suffer the most economic and health consequences. University of Michigan assistant professor and Urban Energy Justice Lab director Dr. Tony Reames explores the issues and needed solutions in this conversation with WEMU's David Fair.

Overview

  • Many households in vulnerable communities face energy poverty. Lower-income Americans often pay 10-20% of their household income for heat and electricity. An affordable energy burden is accepted to be around 6% of total household spending. Energy poverty differs from general poverty because it can be addressed with physical improvements to a dwelling that lower the amount wasted energy, not just an increase in overall income.
  • Speaking to Resources Radio, Tony Reames explains how climate change will exacerbate energy disparities: “If we continue to have temperature extremes, that will require additional energy consumption—whether it’s more natural gas to heat or more electricity to cool. When it comes to affordability, that will impact those who are already suffering from energy poverty. So, if we can reduce temperature extremes—thus reducing our consumption while creating clean energy jobs and making sure we have an equity approach to making homes more efficient—we can address both of those problems at the same time.”
  • In addition, previous research by Dr. Reames showed that lower-income areas often pay more for the same electric products: “We did a survey of about 130 stores in the Detroit metro [to make] an inventory of what light bulbs were available and how much they cost … An LED bulb was about $8 in the poorest neighborhoods compared to about $5 in the higher-income neighborhoods … I think [this price disparity] highlights why policy is so important, because there’s policies for utility companies to reduce the costs, but many utility companies partner with the typical players like Lowe’s and Home Depot, and they don’t partner with many of the smaller stores that are located in poor communities that don’t have big-box stores.”
  • Dr. Tony Reames is an assistant professor in the School for Environment and Sustainability at the University of Michigan in Ann Arbor and Director of the Urban Energy Justice Lab, which conducts research on topics at the intersection of energy and equity. Dr. Reames is affiliated with the Center for Sustainable Systems, Center for Local, State and Urban Policy, Energy Institute, and UM Poverty Solutions initiative. He has a PhD in public administration from the University of Kansas, a Masters in engineering management from Kansas State University, and a Bachelor of Science in civil engineering from North Carolina Agricultural & Technical State University.

Transcription:

David Fair: I'm David Fair and welcome to this week's edition of Issues of the Environment. Today, we're going to talk about energy poverty and the search for solutions to the unequal energy burdens that exist in our society. Our guest is Tony Reames, who serves as an assistant professor in the School for Environment and Sustainability at the University of Michigan and as director of the Urban Energy Justice Lab . Thank you so much for the time today, Tony.

Tony Reames: Thank you for having me, David.

David Fair: How would you define energy poverty?

Tony Reames: Energy poverty is the inability of households to adequately meet their energy needs. And this has some physical, economic, and behavioral dimension, and it also exacerbates adverse health issues.

David Fair: So, do we have a statistical breakdown of the amount of energy being used in more affluent areas versus low income areas?

Tony Reames: Yes. So, what we see when it comes to energy consumption, low income households and communities of color often live in smaller homes and consume less energy. Whether they consume that energy centrally, which means they're wasting energy and often spending more for that energy that they consume.

David Fair: So when you say we're wasting energy, are these energy efficiency measures?

Tony Reames: Yes. So, although low income households and a lot of households of color consume less energy, again, they're using it less efficiently because of appliances or the physical structure of the home is not well insulated. So, again, wasting energy and spending more and more on that energy.

David Fair: What percentage of income is actually affordable for low income areas on average?

Tony Reames: So, an affordable energy burden, which is a percent of your income spent on residential energy costs--usually electricity and heating--anything less than six percent is considered affordable. If you spend more than 10 percent of your income on energy costs, that's considered extreme energy.

David Fair: Now, there is a disparity of somewhere between four and 14 percent of what is affordable and what low income households are paying on average. How did we get to this place?

Tony Reames: So the United States has recognized energy poverty and energy burden as an issue ever since the energy oil crisis in the 1970s. And so, we have that federal programs that address energy affordability called the Low-Income Home Energy Assistance Program. But with most programs, you know, there's never enough resources for the need across the country. And so, often, because households can't afford to make their homes more efficient, they have lower incomes and deferred maintenance--a vast majority of people across the country.

David Fair: We are talking with Tony Reames. He is assistant professor in the School for Environment and Sustainability and the director at the Urban Energy Justice Lab at the University of Michigan. And we're talking about energy poverty. Now, Tony, we're in the midst of climate change. Many now call it climate crisis. The planet is warming. Energy needs may become greater. Have you projected forward at all and explored what climate is going to do to the existing disparity in energy and consumption?

Tony Reames: Yeah, we know that extreme temperatures, weather, extreme heat, or extreme cold will exacerbate energy poverty, especially because consumption is tied to efficiency--homes that will be using more heat, natural gas can be expensive for households during the winter time. One thing we notice along in the southern region of the country is that increased air conditioning use in the summertime and really associated energy poverty. It'll be interesting to see what it's like here in the Midwest, as we know that many of the older homes in the Detroit area and some of our older cities, homes were not built with AC. And so, well, low income households will suffer because they don't have access to AC in these extreme temperatures.

David Fair: We are in the beginning stages of the move towards more renewable energy sources. We all know it's more sustainable than fossil fuels, and we're told it will ultimately be more cost effective. Is that your finding when it comes to the study of energy poverty?

Tony Reames: As we think about the energy transition, we must center equity in our decision making process. If we don't, we will have the same disparities that have existed in our current energy system. And so, we need to look at policies that give incentives for a low income household and communities of color to participate in this transition--how to equitably distribute renewable energy, how do we look at transitioning households to electric vehicles. What we don't want to happen is that the more wealthy households are able to participate in this transition and lower income households and communities of color are left with disinvested energy infrastructure and reliant on fossil fuel.

David Fair: Seems to continue along. The policy of the haves continue to have more and the have nots continue to have less.

Tony Reames: Exactly

David Fair: In dealing with utilities, obviously, profit margin is at the core of what they do in addition to providing grid security and the energy that we all consume. Are there policy shifts in pricing or distribution that need to be addressed immediately and then for the long term as well?

Tony Reames: I think there are some really interesting pilot projects going on that are considering this idea of a percentage of income payment. And so, if we have identified that six percent is an affordable or less than six percent is an affordable energy burden, how do we recognize the income that different users have and create a rate structure that allows them to affordably access energy and again align with utility goals? That is the conversation that needs to be had an honest conversation that we have between our regulators, utilities, and customers.

David Fair: Once again, this is Issues of the Environment on Eighty-Nine One WEMU. We're talking with the director of the Urban Energy Justice Lab at the University of Michigan, Tony Reames, we've highlighted some of the issues and problems surrounding energy poverty, and we're going to continue now talking about more solutions. We've talked about efficiency, but what are the immediate measures that perhaps even lower income people can take in their homes to increase that efficiency and save money?

Tony Reames: For some of the low-hanging fruit when it comes to energy efficiency or simple things like light bulbs? And so how do we change out inefficient, incandescent bulbs for LED bulbs...

David Fair: But even aren't those LED bulbs more expensive in low income neighborhoods than they are in big box stores in higher end neighborhoods?

Tony Reames: That is a great question. And in a study that we did in the Detroit Metro, we did find that light bulbs were less available and more expensive in lower income neighborhoods. And so one of the ways we can solve that solution is direct install by utility companies or actually partnering with some of the smaller stores in low-income communities to rebate or discount the cost of those people.

David Fair: And, you know, when you start talking about windows and increasing insulation and bringing in companies to do that, further waterproofing and insulating basements, fact of the matter is, it's all very expensive and inaccessible to all too many. So, how important will government and community subsidies be to the success of such efforts?

Tony Reames: I think it'll be very important, David. One of the exciting things about the current infrastructure plan that the administration has proposed is that housing is a key component of that. And I think we have to consider housing as part of our national infrastructure. And so, if we can get to this point of community energy projects where we renovate homes on a block that block is good for the next 20 years and then you go to the next block. I'm a former civil engineer and infrastructure engineer, and we had five-year capital improvement plans where we renovated streets and renovated your old pipes. And so we do that same type of planning for housing, we create jobs,  we reduce the impact on the environment, and bwe egin to reduce energy poverty.

David Fair: When we have these conversations, Tony, we always tend to talk about homeownership and what we're doing and those residences. But what about the apartment complexes? The condominium complexes that seem to have their own set of rules and own set of management?

Tony Reames: Yeah, multifamily is a major component to this idea of housing and building those infrastructure. Getting owners on board to understand if you reduce the energy costs, which often is the second highest cost that residents pay, then they can pay their rent, they can buy food, and they don't have to make choices between energy and things like that. And so reducing energy costs allows for residents to do more with their disposable income and pay rent and pay mortgages on time. 

David Fair: Well, again, the Biden administration infrastructure proposal is under consideration now and could make both short and longer term difference, steps are being taken to address climate, getting to a place where we actually level things off on that front will take, at minimum, decades, perhaps significantly longer over the next 20 to 30 years. Do you think there is the will--the political will and the community will--to address energy poverty and make it better, or will it be worse in decades to come?

Tony Reames: I think the pandemic has really highlighted this challenge. And you saw movement toward considering energy as a basic right with all the shutoff moratorium across the country. As those begin to expire, it will be interesting to see how utilities and regulators and communities deal with these challenges, the massive debt that people have racked up. But I do think there is now a light being shown on energy, poverty and how essential energy is in our homes or its energy consumption has transitioned from our workplaces and schools to our homes. And so, I think this experience will create the political climate action we want.

David Fair: I'd like to thank you for taking time to share information with us today, Tony. I appreciate it.

Tony Reames: Thank you for having me.

David Fair: Tony Reames is an assistant professor in the School for Environment and Sustainability and serves as director of the Urban Energy Justice Lab at the University of Michigan. For more information on today's topic, visit our website at WEMU dot org. Issues of the Environment is produced in partnership with the office of the Washtenaw County Water Resources Commissioner. And you hear it every Wednesday. I'm David Fair and this is your community NPR station. Eighty-Nine One WEMU FM and WEMU HD One Ypsilanti.

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— David Fair is the WEMU News Director and host of Morning Edition on WEMU.  You can contact David at 734.487.3363, on twitter @DavidFairWEMU, or email him at dfair@emich.edu