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"For households who will be shut off from electricity this summer because they cannot afford their bills, even being inside their homes is dangerous," a new report says.
Low-income Americans face climbing energy costs and the possibility of summertime power shutoffs—even amid a devastating heatwave—if they can't pay their utility bills, thanks to a lack of legal protections in most states, a report issued Tuesday by a pair of advocacy groups warns.
The Center for Energy Poverty and Climate (EPC) and the National Energy Assistance Directors Association (NEADA) released the report, which calls for an increase in federal funding to address the issue, as more than 100 million Americans this week face heat advisories and extreme temperatures driven by climate change become increasingly common.
Many low-income people face the prospect of extreme heat inside their own homes, as 31 states offer no summer shutoff protections, the groups said.
"For households who will be shut off from electricity this summer because they cannot afford their bills, even being inside their homes is dangerous," the report says. "In less extreme situations, a family can ride out a hot day by opening their windows, taking a cool shower, and hoping it cools down at night. But when the heat persists for weeks, or the outside air is dangerous, opening a window will only make things worse."
Millions of US low-income households face power shut-offs amid deadly heat.
Half of Americans live in states without rules restricting disconnections for unpaid or overdue bills, report finds. https://t.co/0WYJHmwJ4e
— Watchdog Progressive (@Watchdogsniffer) July 16, 2024
EPC and NEADA estimated that the average American household will spend $719 on cooling costs between June and September of 2024, an 8.7% increase over last year. The rising costs of basic goods has left low-income households forced to decide between paying for food, energy, rent, and other essentials such as medicine, the report says.
Despite the increased need, federal funding to help low-income Americans cover their energy costs declined in fiscal year 2024. The Low Income Home Energy Assistance Program budget was cut significantly—from $6.1 billion to $4.1 billion—and only 12% is estimated to be allotted to summer cooling initiatives.
Republicans in the U.S. House of Representatives initiated the cut, which they attempted to make even more dramatic. EPC and NEADA have called for the funding to be restored, and progressive lawmakers have regularly pushed for more funding for the energy needs of low-income Americans in recent years.
Power shutoffs in summer months are common across much of the U.S., and were faced by roughly 1 million customers or more in 2022, according to Sanya Carley and David Konisky, two energy insecurity researchers who wrote about what they call the "disconnection crisis" in The Conversation on Wednesday.
One in four Americans faces energy insecurity—a figure that hasn't improved in the last decade, according to data from the U.S. Energy Information Administration. The problem is prevalent among people with less than two times the federal poverty line income, and especially common in Black and Hispanic households, a 2021 study in Nature Energy found.
Though data are incomplete, disconnections are known to be high in certain parts of the U.S., including the South. "Large investor-owned utilities in Florida, Georgia, South Carolina, and Indiana have averaged disconnection rates near 1% of customers, and some city utilities have been even higher," Carley and Konisky wrote.
The monopolistic power that utilities hold, including their influence in state capitals, contributes to the high prices and the lack of protections. "Energy companies are skimming profits from rate hikes," Food and Water Watch wrote in a briefing released Wednesday, citing examples in California, Louisiana, and Florida.
Residents feel the squeeze and are forced into terribly difficult choices—made worse by the extreme weather caused by climate change.
"Aside from unreasonable rate hikes, my May usage was up 10% from last year because of rising heat," David Coleman, a retiree in Florida, told Food and Water Watch. "I pay that bill out of my UnitedHealthcare healthy food benefit. Less for food; more for energy."
"We have a duty to take decisive action that achieves both short-term relief and addresses systemic causes of the climate emergency fueling the heatwaves."
With about a third of Americans facing potentially dangerous hot temperatures on Thursday, over two dozen Democratic lawmakers wrote to House of Representatives leadership to demand short- and long-term legislative action on deadly heat.
"We write with deep concern about the impacts of this summer's relentless heatwave that endangers the lives of millions of people across our country without access to electricity, water, and other basic utility services," they wrote to House Speaker Kevin McCarthy (R-Calif.) and Minority Leader Hakeem Jeffries (D-N.Y.). "We have a duty to take decisive action that achieves both short-term relief and addresses systemic causes of the climate emergency fueling the heatwaves."
The legislators—led by progressive Reps. Jamaal Bowman (D-N.Y.), Cori Bush (D-Mo.), and Rashida Tlaib (D-Mich.)—called for an emergency package that creates a national heat-related moratorium on utility shutoffs, assists low-income households, and establishes cooling centers and drinking water facilities for at-risk people, "especially unhoused populations, laborers (including farmworkers, construction workers, delivery and postal workers), migrants, elderly, and low-wealth communities."
"Last year, Reps. Bush, Tlaib, and Bowman introduced a resolution that recognizes access to electricity, water, broadband, and other utility services as a human right," the letter notes. "Despite this and the increasingly precarious and often fatal consequences of disconnections during heatwaves, only 20 jurisdictions offer heat-based moratoria on electricity disconnections compared to the 41 that do so for cold temperatures."
"The extreme heat emergency pummeling the country has resulted in widespread public health impacts, from heat stroke to respiratory distress and even death."
As for the long-term fixes, they advocated for a permanent ban on utility shutoffs year-round, a phaseout of fossil fuels that are driving the climate emergency, and funding for "distributed renewable energy systems and climate-resilient, affordable public water systems."
"The extreme heat emergency pummeling the country has resulted in widespread public health impacts, from heat stroke to respiratory distress and even death," the Democrats stressed, pointing to recent deaths and conditions in the communities represented by the letters' leaders. "In urban cities like St. Louis, New York City, and Detroit, city infrastructure is largely made up of asphalt, concrete, and metal—materials which trap heat and create the 'urban heat island' effect."
"The danger of extreme heat cannot be overstated; just in the past 30 years, heat exposure has killed more people in the U.S. than any other weather-related event, including floods, cold weather, and hurricanes combined," the letter says. "Alarmingly, these heatwaves disproportionately harm people without homes; low-income households; disabled individuals; and Black, Brown, Indigenous, and other marginalized communities."
"The legacy of racist redlining has not only concentrated these groups in housing that is costlier to cool and provide water to, due to leakier plumbing and outdated fixtures, but redlining has also deprived these neighborhoods of tree cover, green space, public water fountains, and other public sources of relief from extreme heat," the letter continues. "These communities are more likely to suffer from elevated levels of illness that extreme heat and dehydration can exacerbate, like heart and respiratory diseases."
The lawmakers' demands were endorsed by multiple advocacy groups across the United States, including the Center for Biological Diversity (CBD), Food & Water Watch (FWW), National Homelessness Law Center (NHLC), and PODER, whose director, Susana Almanza, said that "in Texas, the heat is unbearable, people are suffering, and others are dying. Our humanity must override corporate greed, no one should have their electricity or water shut off."
Gaby Sarri-Tobar, an energy justice campaigner at CBD, said heat-related deaths this summer "prove that access to electricity and other utilities is a matter of life or death," and that cutting off households is "a brutal practice and it has to end."
"To get to the root of this crisis," Sarri-Tobar added, "our elected officials have to transform the fossil-fueled, profit-driven utility system to one that's powered by resilient, just, and affordable renewable energy."
Mary Grant, who directs FWW's Public Water for All campaign, agreed. Congress must "act immediately to adopt these life-saving measures by stopping all utility shutoffs and expanding access to emergency cooling stations and public water fountains and refill stations," she argued. Lawmakers must also "address the climate emergency head-on by stopping fossil fuel extraction and creating a permanent source of federal funding to build safe, climate-resilient, affordable publicly owned water infrastructure."
NHLC senior policy director Eric Tars suggested that "Congress would never tolerate its own AC or water being shut off in the middle of the D.C. summer despite the fact that they've been running a budget deficit for decades, and what's good enough for the People's House should be the bare minimum for people's homes."
"Adequate housing is a human right, and that means housing with utilities that keep one safe from the elements, including the heat," Tars said. "And while everyone should be in housing, until they are, communities also need resources to ensure those living on the streets can survive as well. If the choice is between utility companies' profits and people's lives, we must choose people's lives, every time."
"The utility industry's custom of shutting off power punishes people for being poor," said the authors of a new report.
Energy justice campaigners on Monday called for "a permanent ban" on energy shutoffs by utilities as they released a report showing that major power companies have shut off millions of struggling customers' electricity and heat due to missed payments—while raking in record profits and spending billions of dollars on executive compensation, shareholder dividends, and stock buybacks.
"The utility industry's custom of shutting off power punishes people for being poor," reads a new report by the Center for Biological Diversity (CBD), the Energy and Policy Institute, and BailoutWatch. "This barbaric practice—and related punitive measures, like resale of debt to predatory private companies—must end."
The authors of the report, titled Powerless in the United States, analyzed shutoff data from 30 states between January and October 2022, finding that utilities cut power to households more than 1.5 million times. Based on the rate of shutoffs recorded, 4.2 million households suffered utility shutoffs across the country in the first 10 months of 2022.
Combined with data gathered in the groups' earlier energy justice reports, they found "a staggering 5.7 million electricity shutoffs against U.S. households from January 2020 through October 2022."
\u201cNEW RELEASE: Utilities shutoff power to families over 5.7 million times since 2020 while raking in billions. #NoShutoffs\nRead our new report @CenterforBioDiv @EnergyandPolicy @bailoutwatchorg: https://t.co/oS4Rc5cZ28\u201d— Jean Su \u8607\u5b89\u541b (@Jean Su \u8607\u5b89\u541b) 1675088291
The vast majority of shutoffs between 2020 and 2022 were perpetrated by just a dozen companies, the groups said, including NextEra Energy Inc., Duke Energy Corporation, Exelon Corporation, FirstEnergy Corporation, and Ameren Corporation.
The 12 "Hall of Shame corporations," as the report calls them, were on average less profitable than other utilities profiled in the report, but were still "prone to rewarding executives with lavish pay." They were behind 37% of the dividends paid out to shareholders and 32% of disclosed CEO pay between 2019 and 2021.
They collectively paid their top 70 executives $1.2 billion—about $5.9 million per executive each year.
On average the 12 worst-offending companies spent about $4 billion on dividends each, but the customer debt they were owed by households struggling to pay accounted for about 1% of that amount.
"These 12 companies could have forgiven all 4.9 million documented shutoffs 90 times over using their dividends from 2020 through the third quarter of 2022."
"These 12 companies could have forgiven all 4.9 million documented shutoffs 90 times over using their dividends from 2020 through the third quarter of 2022," reads the report.
Selah Goodson Bell, an energy justice campaigner with CBD who co-authored the study, toldThe Guardian that the research shows how "a small scrape of the amount of money that utilities are shelling out to shareholders... could really change lives in millions of households."
FirstEnergy, which serves customers in Maryland, Pennsylvania, and Ohio, shut off power nearly 240,000 times between 2020 and October 2022, punishing households for their inability to pay bills totaling about $25 million. Meanwhile, the company was able to afford spending $2.3 billion on dividends for its shareholders.
Similarly, Duke Energy cut power more than 600,000 times over that period. Customers owed them about $63 million, while shareholders were lavished with $8.3 billion.
As utility companies have enjoyed record profits, rising fossil fuel prices have driven inflation and have resulted in higher heating and electricity bills as household budgets have been stretched thin. Extreme weather like the winter storm that plunged millions of Texans into darkness in 2021 and the deadly heat wave in the Pacific Northwest that same year could also increase "energy insecurity among poor households and communities of color, which are 'less able to prepare for, respond to, and recover
from disaster events,'" the report reads.
"Heating a house with fossil gas this winter is expected to cost 66% more than it did two years ago," reads the report. "Electricity prices have also risen approximately 12% compared to 2020. The average family could pay more than $1,200 to heat their home this winter—$175 more than last winter and $300 more than the 2020 winter."
As households continue to struggle to afford necessities, utilities' punitive shutoffs and rewards for executives and investors show no sign of slowing down, according to the report. Researchers found a 29% increase in power disconnections and a 76% rise in gas shutoffs between January and October 2022, compared to the same period in 2021.
To address the shutoffs crisis, said the authors, the U.S. Energy Information Administration and Congress could require reporting on utility disconnections, while Congress "should vastly increase" funding for energy assistance programs for low-income households. Addressing the "underlying conditions"—reliance on fossil fuels for energy—and phasing out the use of oil, gas, and coal is also key to stopping punitive shutoffs.
Congress must also "enact a nationwide ban on utility shutoffs and other punitive collection practices for unpaid household utility bills for households meeting poverty criteria," said the authors, expanding on pandemic-era legislation.
"Access to electricity is a basic human right," reads the analysis. "People rely on electricity for water, physical safety, food security, medical care, and telecommunications. When these essentials are taken away, the harm spreads like ripples across a pond."
"The preventable practice of disconnections keeps millions of Americans in poverty and narrows their avenues of escape," the authors added. "By giving utility companies the power to penalize poverty, we license them to perpetuate it."