Investment in Transit Can Reduce Energy Burden for Low Income Households

The energy burden is larger for low income households in the United States, and transportation costs play a big role. According to the Center for Neighborhood Technology, for low-income households, the largest majority of non-disposable income goes toward rent, transportation, and energy, in that specific order.   
The American Council for an Energy-Efficient Economy (ACEEE) recently released the report “Lifting the High Energy Burden in America's Largest Cities”, which highlighted the financial burden that energy costs place on households across the United States. The major finding: an overwhelming majority of low-income and minority households experience higher-than-average energy burdens. The proportion of total household income that low-income households pay to energy bills is more than three times what higher-income households pay, on average. Energy efficiency can help reduce this burden and improve energy affordability for households across the board.
The elevated burden on low-income households is compounded by transportation costs. The average household spends almost 20% of their total income on transportation expenses. For low-income households in Detroit for example, this average burden can be as high as 30%, according to the Center for Neighborhood Technology.

African-American and Latino households in Detroit experience amongst the greatest energy burdens in the country.

In Detroit, many jobs have moved away from the urban core, leaving low-income and minority communities inadequately served by affordable and efficient transportation options. With personal vehicles serving as the primary mode of transportation, expenditures on vehicles, gasoline, insurance, and maintenance is substantial in addition to very unpredictable. For every one dollar earned, the average household spends 18 cents on transportation. Of that expenditure, 94 percent goes toward buying, maintaining and operating cars. Transit riders save approximately $1,400 in gas per year (subject to change dependent on current gas prices.) Investment in public transportation improvement, like the RTA Master Plan, creates and sustains employment. And what’s better: public transportation not only increases energy efficiency on a micro-level and strengthens the economy on the macro-level, but also produces numerous environmental benefits. There are even notable public health benefits. 

The ACEEE posits that families who face higher energy burdens experience negative long-term health effects. Statistically, these families are at greater risk for respiratory diseases and increased stress. Lower rates of respiratory illness and heart disease are associated with public transportation vehicles than with the high emissions levels of private vehicles.                                                                        
Programs, including public transportation improvement, that address the high energy burden also help alleviate poverty and provide other benefits to society beyond energy savings, such as economic development, employment, education, and public health.
Anna Graff


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