Coldest States in America: Heating Costs and Winter Severity

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Alaska averages just 26.6 degrees annually, and North Dakota and Minnesota aren't far behind. For millions of Americans in cold-weather states, winter heating bills are climbing faster than temperatures are dropping. Here's what living in the coldest states actually costs.

Alaska averages 26.6 degrees Fahrenheit annually, making it the coldest state by a wide margin. But the five coldest contiguous states, including North Dakota, Minnesota, Wisconsin, and Montana, are where tens of millions of Americans actually live, pay utility bills, and write property tax checks every year.

The 5 Coldest States, Ranked

Average annual temperature tells the clearest story about long-term heating burden.

Alaska — 26.6°F average annual temperature
North Dakota — 42.3°F
Minnesota — 42.5°F
Maine — 44.0°F
Wisconsin — 44.4°F

Montana, Wyoming, Vermont, and Michigan round out the top ten. These rankings are based on NOAA 30-year climate normals updated through the most recent available data. What the numbers don't capture is wind chill. Fargo, North Dakota regularly sees wind chills below minus 40°F in January. Duluth, Minnesota averages 141 inches of snow per year. Cold on paper becomes brutal in practice.

What Heating Actually Costs in These States

The U.S. Energy Information Administration's Winter Fuels Outlook projects that homes heating with heating oil will spend an average of $1,390 this winter, and that figure climbs sharply in colder cases. Natural gas customers in the coldest states routinely spend $1,800 to $2,400 per heating season. Propane-dependent rural households in states like Maine and Minnesota can easily hit $3,000 or more.

Utility rates compound the problem. Electric rates in states like Maine now exceed 22 cents per kilowatt-hour, among the highest in the country. Minnesota's average residential electric rate sits near 14 cents per kWh, which sounds moderate until you factor in that cold-climate homes consume 30 to 50 percent more energy than the national average. A prolonged polar vortex event, the kind that hit the Upper Midwest in early 2026, can add $400 to $600 to a single month's bill.

Natural gas infrastructure helps where it exists. North Dakota and Wyoming both have access to relatively cheap gas because of proximity to production, which partially offsets the brutal winters. Maine, by contrast, has limited pipeline access, pushing more households onto heating oil and propane at higher market prices.

Tax Burden in Cold States: The Hidden Winter Tax

High heating costs don't exist in isolation. Several of the coldest states also carry meaningful tax burdens that compound the cost of living through winter.

Minnesota has a top income tax rate of 9.85 percent, one of the highest in the country. Maine tops out at 7.15 percent. Wisconsin's top rate is 7.65 percent. These states fund extensive public services, including road clearing and infrastructure maintenance that cold climates demand, but residents pay for it twice: in taxes and in utility bills.

North Dakota is the outlier. Its top income tax rate dropped to 2.5 percent in recent years, and the state has no estate tax. For cold-weather tolerance in exchange for a lighter tax load, North Dakota makes a genuinely compelling case. If you're weighing retirement options and can handle the winters, our Best States for Retirees to Avoid Taxes post lays out which cold states still win on the tax side.

Alaska takes this further. It has no state income tax, no state sales tax, and pays residents an annual Permanent Fund Dividend. In 2026, that dividend is approximately $1,700 per resident. Cold is the price. No taxes is the reward. See how that compares to warm-weather tax havens in our breakdown of The True Cost of Living in High-Tax States.

Is 2026 a Bad Winter? What the Data Shows

The 2025-2026 winter saw above-normal snowfall and multiple polar vortex intrusions across the Upper Midwest and Great Lakes region. NOAA's seasonal outlooks through spring 2026 confirmed below-normal temperatures for the northern tier of states. For residents in Minnesota, Wisconsin, and the Dakotas, this translated directly into elevated heating demand and utility bills running 15 to 25 percent above the five-year average for many households.

Climate patterns suggest cold-state residents should budget for winter variability, not assume mild years are the new norm. A single severe winter can cost a Minnesota homeowner $1,000 more than a mild one.

Key Takeaways

Alaska is the coldest state at 26.6°F average annual temperature, followed by North Dakota at 42.3°F and Minnesota at 42.5°F.
Heating oil households in cold states spend an average of $1,390 per winter at baseline, with propane-dependent rural homes in Maine and Minnesota reaching $3,000 or more in severe winters.
North Dakota and Alaska offer the strongest combination of cold climate and low taxes, with North Dakota's top income tax rate at 2.5 percent and Alaska collecting no income or sales tax at the state level.

Use our state cost of living calculator to see exactly how heating costs, taxes, and total living expenses stack up between your current state and the coldest, or cheapest, alternatives on the map.

Sources

Where to confirm these figures

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