RD68 - Report on the Effectiveness of Low-Energy Assistance Programs - June 1, 2003 - July 30, 2004


Executive Summary:
The purpose of this report is to assess the adequacy of energy assistance services that target low-income income households and to explore whether a duplication of services exists among the myriad of programs serving these households. Low income energy assistance services include heating and cooling subsidies, crisis intervention and weatherization. These programs and services are administered by the Virginia Departments of Social Services, Aging, and Housing and Community Development, and Virginia’s major utilities.

During state fiscal year (SFY) 2004, major energy assistance programs in the Commonwealth served approximately 154,498 households, representing an increase of 9,657 households from SFY 2003. Total spending across programs during SFY 2004 was $36,040,008, compared to $35,315,527 in SFY 2003.

Energy affordability remains a critical challenge to low-income and vulnerable Virginians, who spend a much higher portion of their income on energy expenses than middle and upper income households. According to the 2000 census, approximately 254,552 households in Virginia fall below the federally defined poverty threshold. In Virginia, 60 percent of energy assistance recipient households have annual incomes of less than $10,000. Though energy assistance programs provide critical support to needy families and individuals, the programs do not fully meet the energy assistance needs of recipient households.

This report provides an overview of the major energy assistance programs offered by state agencies and utilities. An analysis of households served, expenditures, and case denial data are included in the overview of energy programs. Additionally, this report contains the results of a survey of both energy assistance program participants and low-income Virginians that focused on the adequacy of benefits, program utilization and customer satisfaction. The results of this survey indicate that there may be less awareness about energy assistance programs than other social service programs, thereby indicating the need to increase outreach activities and enrollment strategies.

Outreach and enrollment strategies improve program effectiveness by broadening access and educating customers and the general public about benefits, as well as about energy conservation and efficiency. Presumptive eligibility for the fuel program was implemented statewide in 2003. The implementation of this enrollment strategy allowed for the automatic enrollment of 19,600 pre-selected Food Stamp cases. An increase is anticipated in the number of households enrolled in the fuel program each year as a result of presumptive eligibility.

When evaluating program effectiveness and benefit adequacy, another factor considered in this report is the extent to which the assistance affects a household’s energy burden, allowing them to better cope with energy costs. Energy burden is the ratio of household income to energy cost and is often used to measure the problems households encounter in meeting their energy needs. Nationwide, low income households’ energy burden is four times higher than non- low income households, according to the U.S. Department of Health and Humans Services, Low Income Home Energy Assistance Program (LIHEAP) Notebook, 2004.

Recognizing the enhancements needed to address the issues and concerns raised in the survey, the Department of Social Services is working in conjunction with Department of Housing and Community Development, other state agencies, utilities and many community based partners to improve outreach service delivery and program effectiveness. These efforts include REACh, a three year energy conservation project, and the first annual Energy Fair, held in October 2003.

While the number of households assisted during state fiscal year increased, data from the low- income survey, the census and energy assistance programs indicates a large number of eligible households are still not receiving assistance. Energy insecure households are often forced to make difficult choices which can compromise health and safety. Clearly, the need for energy assistance programs exists; the benefits provided make a significant difference for recipient households.