The coronavirus pandemic and rising energy prices have left millions of U.S. households behind on electricity and gas bills, and some are now on the verge of losing service as the moratorium on utility shutdowns expires.
More than 20 million households delinquent utility bills The National Energy Assistance Directors Association, which represents state agencies that make government payments to low-income energy consumers, was worth $23 billion at the end of February, nearly double what it was in 2019.
The number of delinquent accounts has risen during the pandemic when some state regulators and utilities froze disconnects for non-payment. Customers get extra protection during the winter months, when states regularly ban closures.
However, the moratorium largely expired on May 1. NEADA predicts that more than 2 million homes will lose power in the coming months.
“We’re seeing a wave of closures coming because we’re not prepared for so much debt,” said NEADA executive director Mark Wolfe.
utility gasoline price According to the consumer price index in April, it was up 23% from last year. Electricity prices rose 11%, driven in part by the cost of wholesale natural gas fuel purchased by power plants. Higher energy costs are helping drive inflation that has been straining household budgets.
One in five American households cannot pay their energy bills At least once in the past year, according to the U.S. Census Bureau’s Household Pulse Survey last month. Nearly one-third of households say they forgo expenses such as food and medicine to pay utility bills.
Michigan single mom Korie Bosley received DTE Energy’s cease-and-desist notice last month when her bills doubled and she couldn’t afford to pay. Not eligible for state aid, Bosley contacted a private organization, here is the Help Foundation, to avoid closure.according to Michigan Public Service Commission1 million accounts owed $346 million as of April 2022.
“I’m doing what I can to make ends meet every day,” Bosley said. DTE did not respond.
In financial filings, the utility acknowledged the financial impact of customers who defaulted on their bills.
New Jersey Utilities, a unit of the public service conglomerate, reported it would take “several years” for its cash flow and unpaid account levels to return to normal following the state’s shutdown, securities filings show.
Duke Energy, a North Carolina-based utility operator, observed that “A significant increase” delinquent and expected to increase write-offs.
“Since the beginning of the pandemic, we have acted swiftly and swiftly to help our customers by voluntarily suspending disconnections for non-payment,” the company said. Disconnections in 2021 are down 41% compared to 2019 .
The utility company said disconnection was a last resort and many efforts were made to help households before the shutdown.
“Today, customers have more flexible payment options and plans than ever before that are helping customers manage cost increases due to rising natural gas prices,” said the Edison Electric Institute, a U.S. investor-owned utility trade group.
Last month, President Joe Biden Announce Additional $385 million in Low Income Home Energy Assistance Program funding. More than $8.3 billion was provided in LIHEAP aid this year, the program’s largest annual investment to date. Advocates say it’s not enough to meet demand, and some families face bureaucratic hurdles when trying to use the program.