Landmark investments under the Build Back Better Act will bring savings to consumers on energy costs and on electric vehicles. Household energy costs could be cut by as much as $500 per year thanks to investments in bringing more cheaper sources of clean energy to the grid and improving energy efficiency. Meanwhile, ignoring the problem will only make costs go up for individuals and families. Everything from food to electricity bills to flood insurance and even healthcare costs is impacted by increasing temperatures and our reliance on fossil fuels.

Key Points

• The Build Back Better Act will lower household energy costs by investing in clean energy, energy efficiency and home weatherization programs. 
• An October 2021 report from the Rhodium Group found that the average U.S. household would save roughly $500 a year in energy costs under the Build Back Better Act.
• Wind and solar are already the cheapest sources of electricity in the United States, and additional investments under the Build Back Better Act will reduce costs further.
• The Build Back Better Act’s investments in electric vehicles will reduce the cost of key vehicle components, including batteries, saving consumers on upfront costs, as  well as up $770 a year on fuel and maintenance costs. 
• Ignoring the problem means higher costs. By the year 2050, continued warming is expected to cause:
  • A $30 billion per year increase in total national spending on electricity bills as temperatures rise. 
  • A two thirds increase in food prices as the climate affects how crops grow
  • A sevenfold increase in flood insurance premiums to keep up with the costs of disasters.
• Meanwhile the air pollution from fossil fuel use is already estimated to cause between $430 billion and $870 billion in health expenses every year in the U.S.

Get The Facts

The Build Back Better Act Will Help Households Save On Energy:

• The Build Back Better Act will turbocharge investments in clean energy, including tax credits for production and investment tax credits for the industry. 
  • The package includes spending for clean energy projects and lending funds for clean energy generation, energy storage and transmission projects in rural communities.
•  Specifically, the Build Back Better Act will lower household energy costs by investing in clean energy, energy efficiency and home weatherization programs. 
• An October 2021 report from the Rhodium Group found that the average U.S. household would save roughly $500 a year in energy costs under the Build Back Better Act.
• Studies show that transitioning to a clean energy economy lowers energy bills, with wind and solar providing increasingly cheaper electricity:
  • Wind and solar are already the cheapest sources of electricity in the United States, and additional investments will reduce costs further.              
    • A 2020 BloombergNEF study found solar PV and onshore wind are the cheapest sources of new-build power generation for at least two-thirds of the global population – including the U.S. 
    • An International Renewable Energy Agency report showed renewable power is increasingly cheaper than any other new electricity capacity based on fossil fuels.
  •  A study from UC Berkeley found that a future of 90% renewable energy by 2035 would cut wholesale electricity costs by about 10% from today’s prices, though they would remain slightly higher than if no policy actions were taken.
  • Under a transition to 100% clean energy in the electric, transportation, building, and industrial sectors by 2035 , each American household stands to save on average between $1,050 and $2,585 ​annually on their energy bills.
  • An 2020 analysis by Rewiring America shows transition to a clean energy economy would save U.S. consumers as much as $321 billion in energy costs.
  • The Rhodium Group found that aggressive clean electricity tax credits could cut national average electricity bills about 4% from today’s levels. (See Figure 9.)
•  Energy efficiency standards, green buildings and investments in weatherization programs save consumers additional money on energy costs:
  • Updates to energy efficiency standards of 47 common consumer products could save the average American household more than $100 per year in 2030, increasing to $230 in 2035 and nearly $350 in 2050.
  • The U.S. Department of Energy’s (DOE) Weatherization Assistance Program already saves participating households an average of $283 per year.
  • Current residential and commercial building energy codes are projected to save consumers $126 billion in cumulative energy costs between 2010 and 2040.
  • Home weatherization can reduce the energy burdens of low-income households by about 25%.

The Build Back Better Act Will Help Consumers Save On Clean Cars:

• The Build Back Better Act’s investments in electric vehicles will reduce the cost of key vehicle components, including batteries, saving consumers money on upfront costs, as well as fuel and maintenance costs. 
  • Over the last ten years, a surge in production of lithium-ion batteries has led to an 85% drop in prices for battery packs used in electric vehicles, making EVs and energy storage commercially viable.
  • As battery prices fall, EVs are expected to reach market price parity with traditional fuel-powered vehicles.
  • The typical household in the U.S. spends almost $1,330 per year on gas, which represents about 9% of household income for lower-income households.
  • An AAA analysis found EV owners see annual savings of $709 per year on fuel alone, with reduced maintenance bringing another $330 in savings.
  • EV fueling costs are 50 to 75% lower than for conventional vehicles, producing lifetime savings of about $12,000 for owners.
    • Overall the Union of Concerned Scientists found that EV drivers, on average, save $770 a year compared to conventional combustion cars on fuel alone.
  • A recent study conducted by the Massachusetts Institute of Technology found that over time, electric vehicles are the most cost-effective vehicles accounting for purchase price, maintenance and fuel cost.
    • Lower maintenance costs and the lower costs of charging compared with gasoline prices tend to offset the higher upfront price of electric vehicles over time.
  • Despite regional variances in gas and electricity costs, an analysis from the Union of Concerned Scientists found that charging a vehicle was more cost effective than filling up at the pump across 50 major U.S. cities.
    • Fuel costs for EVs are cheaper than the cost of gas in the Southeast US.  
  • A 2018 study of EVs in Texas and California found the EV Total Cost of Ownership (TOC) was already lower than for a conventional vehicle, with battery electric vehicles (BEVs) lower than both plug-in hybrids (PHEVs) and hybrids.
  • EVs typically charge at night, when electricity is cheapest to generate. By balancing the demand for electricity, EVs decrease the average cost of electricity, thus reducing overall rates.

Ignoring The Problem Will Only Lead To Increased Costs For Individuals & Families:

• If we don’t address climate change, electricity costs for residential and commercial ratepayers will go up by as much as $30 billion per year by mid-century due to rising temperatures brought on by climate change.
• A study from the International Food Policy Research Institute estimated that climate change will increase the prices of corn, wheat, and rice by at least two-thirds by 2050. 
  • By August, 2021, coffee and sugar futures were up 50% over the previous year due to extreme weather impacts on farming around the world.
• Air pollution alone from fossil fuels costs the United States between $430 billion and $870 billion every year in healthcare costs and lost working income due to poor health. 
• An insurance industry group estimated that flood insurance premiums will have to increase by seven times in parts of the country by 2050 to cover the increase in floods tied to climate change.
  • In California, insurance companies lost a total of $20 billion in the wildfires of 2017 and 2018. The 2020 season alone cost insurers $13 billion. As a result, insurance companies now want to factor climate change into raising premiums for homeowners.