The Federal Reserve Board published a research paper on energy consumption and inequality that defines household energy use to include both residential energy and gasoline for transport. Using the Panel Study of Income Dynamics and a twice-the-median, income-based threshold, the paper identifies 20% of households as energy burdened. Logit analysis links a higher probability of being energy burdened to being nonwhite, being single with dependents, receiving public assistance, having no post-secondary education, and being unemployed. The paper reports that energy-burdened status is persistent, that energy-burdened households have higher marginal propensities to consume and to consume energy than other households, that they show lower expected energy consumption growth despite higher expected income growth, and that they face more volatile energy consumption and income. Over 1999 to 2021, consumption inequality and energy consumption inequality rose more moderately than income inequality, with residential energy consumption inequality rising until 2009 then declining, while gasoline consumption inequality increased steadily to a level 50% higher in 2021 than in 1999.
Federal Reserve Board 2025-04-04
Federal Reserve Board research finds 20% of US households are energy burdened with persistent status and higher energy consumption volatility
The Federal Reserve Board released a paper on household energy consumption and inequality, identifying 20% of households as energy burdened using a twice-the-median income threshold. The study highlights persistent energy-burdened status linked to demographic factors and reports higher marginal propensities to consume among these households. It notes moderate rises in consumption and energy consumption inequality compared to income inequality from 1999 to 2021.