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Government Paying For More Heat Bills

More Americans are getting help to pay home heating bills, and more are likely to need help as the economy continues to struggle, says the National Energy Assistance Directors' Association.

Almost 8 million U.S. households received federal government help to heat homes in fiscal year 2009, up 33% from the prior year, the association says. Applications for assistance in the current fiscal year, which started Oct. 1, are running even higher as more people join the ranks of the long-term unemployed, the association says.

"It looks like 2010 will be a very difficult winter for a lot of people," says Mark Wolfe, the association's executive director. The group represents programs that subsidize energy bills.

More households got assistance last year because of increased funding. Congress gave $5.1 billion to the Low Income Home Energy Assistance Program, or LIHEAP. That was up from $2.6 billion in fiscal 2008.

Wolfe says the federal government is increasingly stepping in to provide Americans with help paying energy bills in the same fashion it's provided base coverage for food and health care. "We are not there yet. But the numbers are moving in that direction," he says.

The big increase in LIHEAP funding last year helped stem what could have been a flood of utility shutoffs, Wolfe says.

In fiscal 2009, 4.3 million U.S. households had utilities shut off at one time or another for non-payment, the association says. That was up from 4.1 million in the previous year.

Much of that increase was likely driven by owners of foreclosed homes who walked away from utility bills, Wolfe says.

Because LIHEAP funds were greater, the average grant to a household in fiscal 2009 covered 48% of winter heating bills, up from 33% in the prior year. The higher coverage probably saved some from shutoffs, Wolfe says.

Given a national unemployment rate of 10% and continued weakness in the economy, Wolfe anticipates a 20% jump in families seeking assistance in the current year, based on initial applications.

If that continues, the association anticipates LIHEAP will need $7.5 billion to keep services at current levels. Wolfe says his group expects to ask Congress for additional funding to keep up. If it doesn't come through, assistance may be cut, he says.

Lower heating bills may help consumers this year. Winter heating bills are expected to drop an average of 8% nationwide from last year, the Energy Information Administration has said.

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