Washington's Energy Indicators

10.  Residential Sector Trends — Household Energy Bill

ADJUSTED FOR INFLATION, THE AVERAGE WASHINGTON HOUSEHOLD SPENT THE SAME AMOUNT FOR HOME ENERGY IN 1995 AS IN 1970. IMPROVEMENTS IN HOUSEHOLD ENERGY EFFICIENCY AND FUEL SWITCHING TO LESS EXPENSIVE FUELS HAVE OFFSET HIGHER ELECTRICITY PRICES.

In 1995, the average Washington household spent the inflation-adjusted sum of $872 for electricity, natural gas and petroleum delivered to the home, identical to the figure in 1970. This outward similarity masks significant changes in the composition of household energy expenditures over the last 25 years. Increased emphasis on energy conservation and fuel-switching from heating oil to wood (much of which is harvested free of charge) helped to mitigate the impact of the oil shocks of the 1970s on the home energy bill of Washington households. However, there is no immediate substitute for electricity, so when electricity prices increased by 62 percent between 1980 and 1983, due largely to the inclusion in rates of the WPPSS nuclear bonds, the average household electricity bill increased by a like amount.

Over the long run, energy efficiency and fuel-switching have helped reduce household consumption of relatively expensive electricity. The electricity bill for the average Washington household dropped by 18 percent between 1985 and 1995; usage per household fell 14 percent. Many households saved by switching to natural gas; the average gas bill fell by 17 percent between 1985 and 1995, despite a 27 percent increase in per household consumption.

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