The Cost of Staying Cool: How Inflation Is Putting Air Conditioning Out of Reach for Working Families

Summer used to mean heat, cookouts, and the steady hum of a window unit keeping the family cool. For millions of working Americans, that simple comfort is becoming a luxury — one that inflation, corporate pricing decisions, and gutted federal assistance programs are steadily pricing out of reach.

The numbers are stark. The average American household is now projected to spend $784 cooling their home from June through September — a 12-year high.

Equipment Prices Have Nearly Doubled Since 2020

If your air conditioner dies this summer, brace yourself. The cost of purchasing and installing a new HVAC system has risen roughly 40% on average since early 2020 — and for fully installed systems, costs have often nearly doubled.

Lennox, one of the country's largest HVAC manufacturers, announced a 10% price increase on its new refrigerant-compliant products, on top of a series of earlier hikes. Bosch, Carrier, Trane, and others followed suit with increases ranging from 5% to 10%.

For a homeowner with an aging system — or a renter whose landlord refuses to upgrade — the situation offers no good options.

Electric Bills Are Rising Faster Than Inflation

Even for families who already own functioning air conditioning, running it has become a serious financial burden. Electricity prices have climbed more than twice as fast as the overall cost of living over the past year. The average monthly residential electricity bill rose from about $121 in 2021 to roughly $156 in 2025 — a nearly 29% jump in just four years, according to NEADA.

"It's not just temperatures that are going up, but the cost of cooling is going up," said energy economist Mark Wolfe, executive director of NEADA. "And when electricity prices go up, they tend to stay high. So even if temperatures moderate, your bill might go up because of the cost of electricity."

Driving the utility price surge: rising natural gas costs, massive investment in rebuilding aging grid infrastructure, and growing demand from data centers — all pushing electricity rates higher for residential customers who have no power to negotiate with their utility companies.

Low-income households feel this most acutely. They spend roughly 8.6% of their income on energy costs — nearly three times the 3% that higher-income households spend. About one in four U.S. households report they can't pay their energy bills on time.

Air Conditioning as a Lifeline

For generations, the Low Income Home Energy Assistance Program (LIHEAP) has served as a critical safety net — providing billions of federal dollars annually to help low-income families pay heating and cooling bills and avoid utility shutoffs. As summers have grown hotter and electricity bills higher, LIHEAP has become more important, not less.

On April 1, 2025, the Department of Health and Human Services dismissed the entire staff responsible for administering the Low Income Home Energy Assistance Program (LIHEAP) — roughly 15 to 20 federal employees whose roles included distributing funds to states, providing program oversight, and ensuring payments were processed. The action was part of a broader HHS workforce reduction effort that targeted up to 10,000 positions across the department.

The Trump administration also proposed eliminating LIHEAP funding entirely in its FY2026 budget request, describing energy assistance as "unnecessary" in light of its "energy dominance" policy agenda. Congress did not adopt that proposal, ultimately funding the program at $4.045 billion. However, with federal staff no longer in place, states were left to administer their programs without federal training, guidance, or oversight, according to the National Energy Assistance Directors Association (NEADA).

Who Bears the Cost

The consequences of pricing working families out of air conditioning are not abstract. Heat-related deaths in the U.S. have more than doubled since 2020 — from fewer than 1,200 that year to more than 2,300 in the record-hot summer of 2023. As electricity bills climb and assistance programs face political assault, public health experts warn those numbers will grow.

For those just above the LIHEAP income threshold who don't qualify for assistance but can't easily absorb $300 or $400 monthly electric bills — the choices are bleak. Cut back on groceries. Skip restaurant nights. Forgo other activities. Or simply sweat it out and risk heat exhaustion.

For working Americans living paycheck to paycheck, the summer heat isn't just uncomfortable. It's expensive, it's dangerous, and increasingly, it's a measure of how little the economy is working for the people who do the most to keep it running.