Industry forecasts show households facing an average $976 in home heating costs this winter, up 7.6% from last year, according to estimates cited in recent analyses. This follows elevated summer cooling expenses and contributes to mounting pressure on consumer budgets heading into 2026.
A new report from The Century Foundation and Protect Borrowers, based on University of California Consumer Credit Panel data through June 2025, highlights accelerating utility debt trends that directly impact collection agencies, debt buyers, and creditors servicing utility accounts.
Key findings:
- Average overdue utility balance rose 32% since 2022, from $597 to $789
- Monthly energy bills (electricity, gas, fuels) increased 35% from March 2022 to June 2025, reaching $265 on average. That’s nearly three times the overall inflation rate
- Roughly 1 in 20 households (about 14 million Americans) have utility debt severe enough to be in collections or heading there soon
- In the first half of 2025, households with severely delinquent utility accounts grew by an estimated 3.8% (117,000 additional cases)
Regional and demographic hotspots: Higher delinquency concentrations appear in areas with extreme weather or aggressive collection policies:
- South and Appalachia: Rates nearly double the national average
- Atlantic coast and Midwest: Average past-due balances exceed $1,500
- Northeast states often top $300 monthly bills; high-cost cooling states like California ($303), Arizona ($289), and Texas ($269) also show strain
Vulnerable segments show elevated risk:
- Black and Asian households: Average overdue balances approach $900 (vs. $750 for white households)
- Deep subprime borrowers (scores <580): Past-due jumped 30% to $834 since 2022
Why this matters: Utility accounts typically rank among the last bills consumers let slide, alongside housing and auto payments. Rising delinquencies here often signal broader financial distress, increasing the likelihood of cross-defaults on other obligations your firms handle.
With energy prices outpacing inflation and demand from AI data centers adding upward pressure on rates, portfolio inflows for utility-related placements could accelerate through the first quarter of 2026. Agencies and buyers should monitor state-level shutoff moratoriums, as many expire post-winter, potentially triggering faster transfers to third-party collections.
