Finance
Energy prices are high and people in these states face the heftiest electricity bills
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Paying utilities bills, including ones for electricity, is a responsibility that many Americans face – and some have difficulty covering – each month.
Nationwide, the amount of money that Americans had to pay for electricity in August averaged $185.59, according to a recently-released report from LendingTree. However, it found residents in some states faced heftier monthly bills than others.
The five most-expensive states clocked average monthly electricity bills whose costs ranged from 21.6% to 37.1% above the national average, it reported.
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LendingTree said its findings for monthly electricity bill costs were based on data from the Energy Information Administration (EIA).
Residents in the following five states were on the hook for the largest average electricity bills in August, according to LendingTree’s analysis:
Connecticut: $254.47
Fall foliage along the Connecticut River in Hartford. Hartford is the capital of the U.S. state of Connecticut. Hartford is known for its attractive architectural styles and being the Insurance capital of the United States (iStock / iStock)
Arizona: $252.60
In an aerial view, the downtown skyline is seen during a heat wave on July 15, 2023 in Phoenix, Arizona. Weather forecasts today are expecting temperatures to reach 115 degrees. The Phoenix area is grappling with record-breaking temperatures as prolo (Brandon Bell/Getty Images / Getty Images)
Texas: $233.38
In an aerial view, the downtown skyline is seen on April 11, 2023 in Austin, Texas. The city of Austin has been ranked as the top destination of U.S. job markets for the second consecutive year, according to data collected by The Wall Street Journal. ((Photo by Brandon Bell/Getty Images) / Getty Images)
Hawaii: $230.80
The entire coastline of Honolulu, Hawaii including the base of Diamond Head crater and state park, past the hotel lined Waikiki Beach towards downtown in the distance including the suburban neighborhoods dotting the hills surrounding the city center. (iStock / iStock)
Alabama: $225.65
Huntsville, Alabama, USA park and downtown cityscape at twilight. (iStock / iStock)
LendingTree found “usage matters,” reporting some states “may have high rates” for each kilowatt-hour used “but low average monthly bills (and vice versa).”
Utility bills a major pain point for some Americans
LendingTree’s findings about electricity bill costs comes as it reported 23.4% of Americans experienced an inability to cover their entire energy bill or portions of it in the last year, based on Census Bureau Household Pulse Survey data.
The share who felt that creeped up 1.4 percentage points year-over-year, it said.
“Even though inflation has moderated in recent months, life is still crazy-expensive, and that can make it hard to pay your bills,” LendingTree chief credit analyst Matt Schulz said in the report. “Lots of people have found themselves needing to make difficult decisions to keep the lights on.”
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Overall inflation measured by the Consumer Price Index increased 0.3% month-over-month and 2.7% year-over-year in November, according to the Bureau of Labor Statistics.
Buying online Online shopping A Bankrate.com survey reveals that 40% of Americans that are married or living with a partner have committed financial infidelity. iStock iStock (iStock / iStock)
For electricity, prices posted a 0.4% drop month-over-month but remain up 3.1% from 12 months ago. Meanwhile, utility gas service prices rose 1% from October and 1.8% from November 2023, the CPI data showed.
Needing to cover utility bills prompted 34.3% of Americans to curb their spending on necessary things – or eliminate some altogether – in at least one instance in the prior year, LendingTree said.
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In September, the Bureau of Labor Statistics reported American households saw an average of $77,280 in household expenditures in 2023. That equated to about $6,440 per month.
It appears T. Rowe Price is benefitting from the record growth in actively managed exchange traded funds.
Tim Coyne, the firm’s head of ETFs, reports the firm is seeing significant growth in the area — listing the T. Rowe Price Capital Appreciation Equity ETF (TCAF) and T. Rowe Price U.S. Equity Research ETF (TSPA) as two established strategies that can satisfy investor demand.
“I think having that professionally managed portfolio is really beneficial to clients,” Coyne told CNBC’s “ETF Edge” this week. “We’re seeing just… greater volatility [and] uncertainty across both the equity and fixed income markets.“
According to Coyne, the T. Rowe Price Capital Appreciation Equity ETF suits investors who are looking for long-term growth.
“The objective of the fund is to outperform the S&P 500 with lower volatility and greater tax efficiency,” he said. “It’s also a more concentrated portfolio, typically holding around a hundred names.”
As of April 24, the fund’s top holdings include Microsoft, Amazon, and Apple according to the T. Rowe Price website. But it’s not all Big Tech. The ETF also features smaller positions in companies like Becton Dickinson and Roper Technologies.
The T. Rowe Price Capital Appreciation Equity ETF is down about 5% so far this year while the S&P 500 is off about 7% However, the ETF is up close to 8% over the past year — roughly identical to the S&P 500’s performance.
Coyne notes the T. Rowe Price U.S. Equity Research ETF follows a similar strategy, but with a heavier weighting in top tech stocks.
“This is more of a large-cap growth product [T Rowe Price U.S. Equity Research ETF],” he said. “There are components of characteristics of both passive and active here. This fund is actually managed by our North American directors of research. So again, strong fundamental research is going into the stock selection.”
Both the T. Rowe Price U.S. Equity Research ETF and S&P 500 are down around 7% since the beginning of the year. Meanwhile, the fund is up almost 9% over the past year. That’s less than one percent better than the S&P 500’s performance.
T. Rowe Price U.S. Equity Research ETF vs. S&P 500
‘Some form of bear market’
Strategas Securities’ Todd Sohn thinks investment demand for active managers will continue to be strong.
“This is the type of the environment where it [active management] can actually shine,” the firm’s senior ETF and technical strategist said. “We are in some form of bear market. This is where the active manager really can come into hand and offer their solution they are doing right.”
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