Cooling cost for average Phoenix area household went up $120 in just 6 years, report says

Both APS and SRP report breaking demand records this summer — delivering more energy than they ever had before during the peak of the Valley’s summer heat. And higher temperatures and more demand for electricity mean higher energy bills for utility customers.

A new report finds many households across the country cannot afford those bills — including in Arizona.

Elizabeth Berg is a policy analyst in the Heat Policy Innovation Hub at Duke University’s Nicholas Institute and the lead author of the paper “The Cost of Keeping Cool: Energy Affordability and Extreme Heat.”

She joined The Show to talk about what she found and began with what stood out to her about this new research.

Full conversation

ELIZABETH BERG: Sure. So, our analysis largely took a pretty broad look at the intersecting impacts of extreme heat and energy burdens. I’d say one of the main takeaways is that energy poverty is extremely common. So, we looked at this along a few metrics, but broadly, we were looking at what percentage of households have to spend an unaffordable amount of their income, so more than 6%, just on energy bills.

And while it varies slightly year to year, we found that about one in three households is in this position of having to spend an unaffordable amount just on their monthly utility expenses.

MARK BRODIE: What are the implications of that, that so many households are basically running up bills for energy that they can’t afford to pay?

ELIZABETH BERG: I mean, it just puts people in a really tough position of making kind of impossible choices. So, it puts these households in the position of needing to choose between maintaining a safe living environment, making sure that they are running cooling when they need, heating when they need, and paying for other necessities.

MARK BRODIE: Did you find that the bills tend to be highest in either the winter or the summer, depending on which part of the country they’re in, as opposed to in the spring or in the fall?

ELIZABETH BERG: That is one thing that we looked at. At least from an academic perspective, a lot of people talk about energy burdens in an annual context, but of course, we pay our bills monthly. So, we were trying to look at how often, even if someone comes out totally fine at the end of the year, how often people are still facing a couple months or seasons of unaffordable burden.

And, yeah, nationally, it’s either the winter or the summer when costs tend to peak. In most states, winter is the most expensive month. However, that — we were finding that in the warmer parts of the country, Arizona included, one of seven states in this category, summertime is the season with the highest energy bills.

MARK BRODIE: Well, so to the point you were just making about how a lot of academics look at this annually, but of course, we pay our bills monthly. You found that in Arizona, generally the annual energy bill was not among the highest in the country, although if you talk to folks here, this time of year, bills are really, really high.

So, is that just a sort of an accounting issue of how the data were looked at as opposed to what folks are actually paying sort of on a month-to-month basis?

ELIZABETH BERG: We’re always kind of restricted at looking at average conditions. There are a lot of factors at play that can vary regionally that will shape kind of where we see some of these hotspots of really high energy costs. So, climate is one of them. If you’re somewhere with really extreme temperatures, you’re going to be doing more to cool or to heat your home.

Some of it comes down to the cost of residential energy, as well as what type of fuel are you using. Are you in an area that’s entirely powered by electricity? Do you rely on natural gas? These all have different costs.

But one thing we found, when you talk about energy poverty, which is looking not just at the overall bills, but how that compares to incomes, on that basis, things are much more consistent across the country, and it often tracks with income. So, we were still finding that a sizable portion, a quarter to a third of homes, were in this position of having unaffordable bills almost wherever we looked.

MARK BRODIE: The energy cost issue is an interesting one, and I wonder what kind of relationship you found between how expensive or inexpensive energy is and how much energy is actually being used.

I wonder if you found places that maybe have more expensive energy and people maybe aren’t using a ton of it, but because of the cost of energy, their bills are higher, or vice versa?

ELIZABETH BERG: So, one part of our analysis was to specifically look at how the cost, not of all home energy expenditures, but specifically the cost of cooling or the cost of running air conditioning, has varied by county, but also has been changing over time.

And while the places that are spending the most on air conditioning tend to be places that have higher climates, we were finding that it’s areas where residential electricity rates are growing seemed to be the places that are facing kind of this recent affordability crisis or facing more recent increases, rather than a mechanic driven by kind of demand or usage alone.

So, California is a state that really stands out in our analysis. They’ve had a lot of recent increases in electricity rates. A lot of that was due to having to pay for upgrades to their grid to make it more resilient to wildfires, but those costs are passed down to the consumers. And we found, we looked from 2018 to 2024, and there are some counties in California that were increasing, their cost just of cooling was increasing by, you know, more than $50 a year.

MARK BRODIE: Well, and you also found that a lot of counties in Arizona, the cost of cooling is going up as well. Did you find that that is mostly related to the cost of energy? Is it just because it’s hotter, it’s getting warmer here and people need to use more energy? Like, do you have a sense of why those costs in Arizona might be going up?

ELIZABETH BERG: So, on a long-term basis, a lot of it has to do with temperatures. Just when we’re looking at the last six to eight years or so, most of the increase itself has been due to increases in cost.

And yes, Arizona is one of the states that stood out as having several counties with pretty significant increases in the cost of cooling. I pulled one example for you. In the Phoenix area, we found that the cost of cooling for an average household in 2024 was about $120 more than it would have been at the same house for the same family in 2018, just six years earlier.

MARK BRODIE: So, a lot of utilities talk about programs they have to try to help folks who are maybe struggling to pay their bills or falling behind on their energy bills. Did you find that those programs are effective? Like, do they have the intended effect?

ELIZABETH BERG: So, while looking at the impact of these programs was a bit outside of the scope of our analysis, one thing that we did look at is where protections exist, and specifically where seasonal protections exist.

How often do utilities or states offer additional support during the times of year when costs are most likely to increase, so when temperatures are really, really hot or really, really cold?

And we found that throughout the country on a state and federal level, there is just much more support for energy affordability and energy access during the winter than there is during the summer.

MARK BRODIE: Well, so given the realities of energy costs being what they are and temperatures being what they are, what do we do about this? How do we try to make it so that households are better able to pay their energy bills and not be too hot in the summer or too cold in the winter?

ELIZABETH BERG: I think one thing that we’re really trying to emphasize with this report is that access to cooling is like a lifesaving necessity. In a lot of cases, I think the way some of this policy is set up almost treats that as a bit more of a luxury, you can keep things cool to be more comfortable.

And we’re really trying to emphasize that in a lot of places, we’re way past that point, and people are trying to reduce cooling or not have access to air conditioning to an extent that is actually threatening their health and well-being. So, I think it’s a bit of a perspective shift there.

MARK BRODIE: All right. Well, Elizabeth, thanks so much for the conversation. I really appreciate it.

ELIZABETH BERG: You’re very welcome. It was great to talk to you.

MARK BRODIE: Elizabeth Berg is a policy analyst at Duke University’s Heat Policy Innovation Hub.