According to the U.S. Energy Information Administration (EIA), in 2021, the energy expenses incurred by U.S. consumers surged past $1.3 trillion when adjusted for inflation, signifying a substantial 25 percent surge from the previous year, as reported by the EIA’s State Energy Data System (SEDS). The upswing in energy expenditures was primarily fueled by a rebound in petroleum consumption after the pandemic-induced slump of 2020, coupled with higher average energy costs.
When considering inflation-adjusted per capita figures, U.S. energy expenditures saw a corresponding 25 percent escalation in 2021 compared to 2020, reaching a value of $3,967 per person. This level of spending per person aligns with the energy expenditure levels observed in 2019. Notably, all states registered a rise in inflation-adjusted per capita energy expenses in 2021.
In terms of the broader economic context, U.S. energy expenses constituted 5.6 percent of the gross domestic product (GDP) in 2021, marking a rise from the 4.8 percent observed in 2020. Despite this upswing, the 2021 energy expenses stood as the third lowest within the dataset that dates back to 1970. This metric, which gauges the ratio of total expenditure on end-use energy in the United States to the total value of goods and services in the economy, serves as a gauge of the energy sector’s impact on the overall economy.
The collective expenditure on motor gasoline, diesel, and jet fuel totaled $757 billion in 2021, reflecting a substantial 44 percent upsurge from the previous year. These petroleum products took the lead, composing the most substantial portion (57 percent) of the overall U.S. energy expenditures for the year.
The outlay on electricity reached $419 billion in 2021, marking a modest 3 percent growth compared to 2020. Our calculation for electricity expenses encompasses the funds expended by end-users such as residential and commercial entities. To prevent double counting, EIA eliminates the expenditures allocated to primary energy sources (such as natural gas, coal, nuclear, renewables, and petroleum) employed by the electric power sector in generating electricity.
Approximately 10 percent ($133 billion) of the nation’s total energy expenditures were attributed to natural gas utilized for non-electricity generation purposes, such as residential and commercial heating and cooling applications.
Coal, utilized for non-electricity generation functions like industrial processes, constituted a minimal portion of the nation’s total energy expenses, accounting for less than 1 percent ($4 billion).