The government shutdown is delaying federal assistance that helps 6 million households pay energy bills — just as winter weather threatens to push those bills higher.
This is around the time the Department of Health and Human Services would typically send states most of its funding for the Low-Income Home Energy Assistance Program. But the Trump administration isn’t making those payments, so states are scrambling to fill the gap, which could force tough decisions for households that rely on the money to keep the power on.
Mark Wolfe, executive director of the National Energy Assistance Directors Association, said it would likely take four weeks once the government reopens to get LIHEAP funds moving again — “if everything goes well.”
“That delay puts a significant wrench in the works,” Wolfe said in an interview. “People will suffer from this.”
The assistance delays come as rising electricity prices have emerged as a politically salient affordability issue. NAEDA has projected that the average household will pay $976 for home heating this winter, up from $907 just a year ago — an increase that outpaces inflation. The biggest increase, the group found, will be for homes that use electric heat, while those that use propane or heating oil could pay less.
The American Gas Association has said in its own analysis that natural gas bills will be higher than last year due to colder weather but that Americans would spend about 8 percent less than they did in the comparable winter of 2022-2023.
In a statement, HHS placed the blame for the funding freeze on the “Democrat-led shutdown” and said the administration is “committed to reopening the government for the American people.” Once the government reopens, the agency said its Administration for Children and Families “will work swiftly to administer annual awards.”
Trump has repeatedly put LIHEAP in the crosshairs, despite promising on the campaign trail to tackle energy affordability. In April, HHS employees that administer LIHEAP were let go as part of broad layoffs at the agency, although one employee was temporarily rehired.
Then the administration proposed eliminating LIHEAP entirely in its fiscal 2026 budget plan. That prompted bipartisan pushback on Capitol Hill, and both chambers have produced HHS spending bills that would increase LIHEAP funding.
The shutdown presents a more immediate threat to the state agencies tasked with distributing the federal aid. Officials in several states have said they’ll have to delay payments, although some — like Pennsylvania — are working with utilities to make sure LIHEAP recipients don’t have their electricity shut off for lack of payment.
Officials in Alaska, Massachusetts, Maine, Vermont and Connecticut have said they can move money around, including tapping unused LIHEAP money from last year, to cover the shortfall. Republican Vermont Gov. Phil Scott, for example, set aside $14 million in state funds for home heating aid, part of a broader emergency package to cover lost federal aid.
“It’s our obligation at this point as states to do what we can for the people we serve,” Scott told reporters last month.
Affordability challenges
The LIHEAP delays are casting another spotlight on rising utility rates. Data centers, electrification and extreme weather are fueling increasing electricity demand that is prompting utilities to spend more to upgrade the grid — and pass those costs on to ratepayers.
A study released this week by Democrats on the Joint Economic Committee, citing Department of Energy data, found that households are projected to pay an average of $100 more for electricity this year than in 2024. In 10 states and Washington, D.C., electricity costs could be 10 percent higher than the previous year.
Cuts to renewable energy programs and the Trump administration’s push for more fossil-fueled power is also forecast to raise rates because of the cost of operating those power plants.
“This is kind of a perfect storm,” said Tony Reames, a University of Michigan professor who directs the Urban Energy Justice lab. “LIHEAP has never done a good job keeping up and now we probably have more people entering energy poverty.”
A 2024 U.S. Census Bureau survey found that 23 percent of American households surveyed were unable to pay an energy bill — or the full amount — at some point in the prior year.
Affordability was at the center of two key gubernatorial races this week, where victorious Democrats hammered their Republican opponents over rising utility bills. Democrats are continuing to spread the message that the Trump administration’s policies are forcing Americans to spend more on power.
The White House says that its energy dominance agenda will lower gas prices. In a justification for its proposed LIHEAP cuts this spring, the administration wrote that it would support low-income families through “energy dominance, lower prices and an American First economic platform.” The document also said that many states prevent utilities from shutting off heat for consumers in the winter, although those programs do not always eliminate the need to pay bills.
However, LIHEAP — which was created in 1981 to help households survive cold winters — is also becoming more important year round. The program has increasingly helped low-income households reduce bills during hot summers.
Wolfe of NEADA said that the delays to LIHEAP should not overshadow another issue with the program: It doesn’t reach far enough. Current funding reaches less than 20 percent of eligible families, according to advocacy groups, and the amount of money offered does not rise with need.
“If you give the same amount of money you gave last year and heating costs are up 8 percent, the purchasing power of that money has been reduced,” Wolfe said. “You can’t buy as much energy as you had last year.”
Uma Outka, a professor of law at the University of Kansas who has studied LIHEAP, emphasized the need for state governments to participate in the affordability conversation. Governors in charge of distributing LIHEAP funds — often along with state-backed assistance programs — and state bodies that oversee utility rates have important roles to play in lowering costs, Outka said.
“Preserving and continuing to grow LIHEAP, not shrink it or eliminate it, is so critical so we have [support for household energy security] at the federal level,” Outka said. “But rates are set at the state level, so understanding what’s happening in the states and how rates are set is also important.”
