Federal heating and cooling aid reached only 15% to 18% of eligible U.S. households each year, the Federal Reserve Bank of St. Louis said in an analysis published Oct. 22.
Funding limits, administrative complexity and low awareness leave most eligible households without assistance, the analysis said. It appeared in On the Economy under the title “The Energy Assistance Landscape: Programs to Reduce Utility Cost Pressures.”
Michael C. Eggleston, a senior community development researcher at the St. Louis Fed, examined federal and utility assistance programs, drawing on recent funding, 2025 participation figures and earlier research. His analysis compared access across seven states in the central bank’s Eighth District.
The Low Income Home Energy Assistance Program helps 5.5 million to 6 million households annually, the analysis said, citing research published in The Electricity Journal. The U.S. Department of Health and Human Services administers the program.
Federal funding averaged about $4 billion annually over the past five years, with supplemental money bringing the fiscal 2023 allocation to $6 billion, the analysis said.
Across Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee, the program served about 804,000 households in 2025, or 17% of 4.6 million eligible households, the analysis said. Most of those states recorded a drop in the share served that year.
Kentucky had the highest participation rate among those states at about 21%, while Mississippi had the lowest at about 13%, the analysis said. Both states had held those positions since 2020.
The U.S. Department of Energy’s Weatherization Assistance Program has served more than 7 million households and improves about 32,000 homes annually, the department’s figures showed. Services include insulation, sealing air leaks and replacing heating and cooling equipment.
Evidence on whether those improvements repay their costs is mixed, Eggleston said. The department estimated household energy benefits of $1.72 and other household benefits of $2.78 for each dollar invested.
The department also estimated average annual energy savings of $372 in 2022 dollars. However, a randomized study published in 2018 found that initial costs were about twice the energy savings achieved, the analysis said.
Utility discounts provide another form of help, Eggleston said. Ameren Illinois began a natural gas discount program in October 2024, offering reductions from 5% to 84% depending on household income, according to the analysis.
Households receiving federal heating and cooling aid join that discount program automatically, the analysis said. It described Illinois as having one of the more comprehensive collections of utility assistance programs among the seven states.
Federal assistance is associated with fewer utility disconnections and improved household energy security, Eggleston said. But limited access persists as households face growing difficulty paying utility bills, making program reach and effectiveness important to assessing those costs.
