Student Loan Forgiveness

A ‘Tsunami of Shutoffs’: 20 Million US Homes Are Behind on Energy Bills

Surging electricity prices spur worst-ever crisis in late utility payments.

Adrienne Nice woke up early on the morning of July 25 to news she’d been dreading. The power company, Xcel Energy Inc., had shut off the electricity to the small Minneapolis apartment she shares with her teenage son, just as a heat wave was bearing down on the city.

Nice had been struggling financially ever since the pandemic hit, racking up more than $3,000 in past-due utility bills. The warnings she’d gotten on her monthly statement—“FINAL NOTICE” scrawled in big, bold letters—had prepared her to some degree, but it was still jarring to find the fridge dark and the air conditioner silent. With temperatures set to reach 95F (35C) in the coming days, she needed the power back on, and fast.

The Nice household is one of some 20 million across the country—about 1 in 6 American homes—that have fallen behind on their utility bills. It is, according to the National Energy Assistance Directors Association (Neada), the worst crisis the group has ever documented. Underpinning those numbers is a blistering surge in electricity prices, propelled by the soaring cost of natural gas.

Nice, 45, is a housecleaner. Her work dried up almost overnight when Covid-19 swept through Minnesota in early 2020. Things are picking up again, but inflation is eating into the money she makes. Just filling up her old Saturn sedan to drive from house to house now costs about $50 a week.

She found it impossible to set aside enough money for utilities, especially as her power bill effectively doubled over the past year. A friend who used to live in the apartment along with her two kids moved out in mid-2021. But though Nice’s household is using less electricity, she’s still getting charged about the same amount per month—$244, on average. “I just don’t understand how electricity can be so high,” she says.

California’s PG&E Corp. has seen a more than 40% jump since February 2020 in the number of residential customers behind on payments. For New Jersey’s Public Service Enterprise Group, the total is up more than 30% for customers at least 90 days late—and that’s just since March.

The average price consumers pay for electricity surged 15% in July from a year earlier, the biggest 12-month increase since 2006. Regulation of electricity rates makes it hard for providers to immediately pass on higher fuel costs, so the recent hikes may be just the start.

In the earlier days of the pandemic, some states and utilities halted power disconnections, shielding customers like Nice who’d fallen on hard times. But those measures wound down just as inflation gathered steam. US households owe about $16 billion in late energy bills, double the pre-pandemic total, according to Neada. The average balance owed has climbed 97% since 2019, to $792. “The bills just aren’t affordable,” says Mark Wolfe, Neada’s executive director. “People on the bottom, they can’t pay this.”

For investor-owned US utilities, the financial repercussions of accumulating debt from unpaid customer bills are typically limited. That’s because state regulators often allow utilities to recover their losses by adding a charge for customers who are paying their bills, or taxpayers help pick up the tab.

In Nice’s case, her power was out for only three days; the nonprofit Citizens Utility Board of Minnesota helped her negotiate a payment plan with Xcel. Her experience is common: Utilities shut off customers only as a last resort, according to Xcel. About 80% of US utility customers who experience a shutoff will have service restored in a few days, Wolfe says. The remaining 20%, though, may be close to eviction or on the verge of homelessness.

www.bloomberg.com/businessweek

Yes, I know, people have to vote smarter. Policy fuck-ups this massive aren't from bad luck. But still, making her pay student loans for those who went to college and can only make six figures is simply cruelty.

If this was smart policy, or even popular policy why wouldn't team Biden take the Constitutional path and introduce a bill in congress? (I know, they hate the fuckin' Constitution. But still)

Surely there's a reason...

Reverse robinhood

Like Georgia's Hope scholarship, which is funded by lottery proceeds?

Incomprehensible amounts of money are spent by this country in foreign aid. But you're focused on Americans getting a little bit of student loan debt relief.

All the right people are mad, so you know it's good

Oh, virtually everyone on the right does when called out on their (sometimes even racist) crabs in a bucket behavior. But the fact is that they don't complain about foreign aid nearly as much or as vigorously as they complain about public money being spent on other Americans (at least on certain other Americans).

You don’t have any student loan debt I hope.

True, except the lottery is voluntary. To be comparable, the student loan would be a check on your tax return...Check this box and add five hundred bucks....



Not exactly. (you tried to get this wrong didn't you?

If he gave every working man 10K to pay bills as they choose, the issue would become simply fiscal responsibility. This is taking a problem and making it an ignorant, unfair nuclear problem.