As households age, they spend less on electricity in dollars, but more as a percent of all their expenditures
The Labor Department has published Consumer Expenditure Survey data on how Americans of different ages spend differently. The survey shows how age affects expenses for electric and natural gas utility service.
Twenty-two percent of households were classified as the youngest. Those surveyed averaged twenty-seven years old.
These households spent $1,125 on electric service, on average, during the twelve months through June 2015.
It was 2.4 percent of what they directly spent on all goods and services. Excluding government, insurance and indirect payments on behalf of consumers.
Twenty-seven percent of households were classified as the second youngest. Those surveyed averaged forty-two years old.
These households spent $1,618 on electric service during the period, on average. It was 2.5 percent of what they spent on all goods and services.
Thirty-five percent of households were classified in the middle, between the younger and older households. Those surveyed averaged fifty-nine years old.
These households spent $1,606 on electric service. It was 2.7 percent of what they spent on all goods and services.
Fourteen percent of households were classified as the second oldest. Those surveyed averaged seventy-six years old.
These households spent $1,431 on electric service. It was 3.4 percent of what they spent on all goods and services.
Two percent of households were classified as the oldest. Those surveyed averaged ninety years old.
These households spent $998 on electric service. It was 3.2 percent of what they spent on all goods and services.
There's a trend as households age, from the second youngest to the oldest group. Dollar expenditures on electric service decreases.
Dollar expenditures on electric service by the youngest group are relatively low.
How does age affect what households spend on electricity as a percentage of what they spend on everything?
As households age, from the youngest to the oldest group, the percent spent on electricity increases. With a small drop off by the very oldest of households.
Let's generalize further.
Most households devote somewhere around 2.5 percent of their direct expenditures to electricity. The notable exception is elderly households. They typically devote over 3 percent to electricity.
The elderly often spends substantially less in dollars on all goods and services. And on electricity.
They spend substantially less, in dollars. But more on electricity in percent of all their expenditures.
What households spend on natural gas service follows a somewhat similar trajectory relative to age.
The youngest households averaged $293 during the twelve-month period. The second youngest averaged $497. The middle group averaged $487. The second oldest averaged $439. The oldest averaged $360.
Though now eighty-eight years old, Public Utilities Fortnightly is still hard at work number-crunching for the electric and gas industry.
Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
E-mail me: mitnick@fortnightly.com
