The economic devastation of the coronavirus pandemic is projected to plunge 20% of families into utility bill debt over the next four months as layoffs and other economic losses continue throughout the country. The average household pays more than $250 per month for critical utilities, and over a four month period of non-payment average household debt to utilities would mount to almost $1,100, new research from Vote Solar finds. This amounts to $26 billion in total utility bill debt over four months.
“Coronavirus is supercharging existing, systemic inequities in the fabric of our society. For families that under non-pandemic conditions are struggling to pay for basic services like heat, water and electricity, now, all at once, timely payment is not an option,” said Tyler Fitch, Vote Solar regulatory manager and lead author of the report. “We must act now to ensure that everyone has the basic services they need to stay home and stay healthy. We also must ensure that families hit hardest by this pandemic are not left with almost $1,100 in utility bill debt and disconnection notices.”
As Congress considers its next stimulus aid package Vote Solar is calling for an immediate end to all shut-offs through the end of shelter-in-place orders. Based on this new research, Vote Solar estimates that a national program to eliminate utility bill debt caused by the pandemic will cost $27.1 billion, including costs to administer the program. Vote Solar is calling for stimulus funds to erase these debts.
However, utility bill debt and affordability have burdened low-income and environmental justice communities well before the pandemic. Vote Solar is also advocating for long-term solutions including: 1) utility data reporting on customer arrearages and deferred disconnections; 2) innovative arrearage management plans, set according to customers’ ability to pay; 3) targeted, effective demand-side management programs for low-income households; and 4) clean energy programs like rooftop and community solar that reduce bills in the long term and address the causes of high utility burdens.
“Now is the time to ensure we rebuild better, with affordable utility access and a clean slate for those in need,” said Melanie Santiago-Mosier, Managing Director of Access and Equity at Vote Solar. “A coronavirus economic recovery strategy that invests in clean energy will help lower electric bills for all customers, making our most vulnerable communities more resilient to economic crises while creating jobs, driving local economic investment and improving public health.”
Vote Solar used the national residential energy consumption survey that provides customers’ monthly utility bills across electricity, gas, water and wastewater and broadband. The analysis estimates that 20% of all households will be unable to pay their utility bills for four months, based on estimates of unemployment through 2020 and consistent with the timing indicated by national legislation to support disrupted households. The budget to administer a program that addresses these arrearages is based on expert opinion.
News item from Vote Solar
Solarman says
“The average household pays more than $250 per month for critical utilities, and over a four month period of non-payment average household debt to utilities would mount to almost $1,100, new research from Vote Solar finds. This amounts to $26 billion in total utility bill debt over four months.”
Forcing utilities to (not shut off) power during a shelter in place event will only work so long, before the utilities themselves have to file for bankruptcy protection. Kind of what happened in California during the 1999 – 2001 electricity deregulation and ENRON power manipulation scam. Folks can see that banks are “offering”, lousy interest rates of return on savings accounts of from 0.5% to 1.5% APY. Putting one’s money to work would be not keeping money in the bank at insulting rates of return and putting it on one’s roof in solar PV that will lower substantially a monthly electric bill or eliminate an electric bill for life. That money saved each month, allows one to buy, groceries, help pay for homeowner’s insurance, car insurance, pay other bills, electricity doesn’t have to be one of the “overhead” items in the household budget.
““Now is the time to ensure we rebuild better, with affordable utility access and a clean slate for those in need,” said Melanie Santiago-Mosier, Managing Director of Access and Equity at Vote Solar. “A coronavirus economic recovery strategy that invests in clean energy will help lower electric bills for all customers, making our most vulnerable communities more resilient to economic crises while creating jobs, driving local economic investment and improving public health.””
This claim is a little short sighted. IOU utilities are at differing phases of power production and most still have fueled generation assets that are not paid for from operations. The more solar PV or wind generation constructed, the less these old fueled assets are producing sellable energy to the grid. The less they sell the longer the asset takes to pay off. What happens then is across the U.S. IOU utilities are allowed to file rate cases for electricity rate increases to recover “stranded assets” and will also file a rate case for electricity rate increases for “lost revenues” when ratepayers cut back on energy use and the utility sells less power than it used to. With these “allowable” programs in effect, the poor will always get stepped on. The old Union game of “wish listing” and “winnowing down” benefit and wages considerations, usually goes like this. The working rank and file have been shown numbers by the employer and numbers by the Union. So, the Union says the rank and file need a ‘minimum’ of 5% wages and 5% benefits increases for a contract lasting 3 years. The employer comes back with the economy is at 1.5% right now, we will agree to 2% and 2% over the next three years. So, the rote IOU utility says we need 7%, the PUC says NO, 3.5% and the Utility says, O.K. but we will need another rate case next year for the rest of the monies ‘needed’. The utility will always ‘figure’ over, the PUC will always ‘figure’ about half and the public get to watch this dog and pony show and say, well it could have been worse.
The bottom line, with technology today, YOU don’t have to put up with it anymore.