Utility bills overwhelm some US households
CALIFORNIA, United States (AP) — Millions of US households are facing heavy past-due utility bills, which have escalated in the year since the pandemic forced Americans hunkered down at home to consume more power.
And now, government moratoriums that for months had barred utilities from turning off the power of their delinquent customers are starting to expire in most states. As result, up to 37 million customers — representing nearly one-third of all households — will soon have to reckon with their overdue power bills at a time when many of them are struggling with lost jobs or income.
A study done by Arcadia, which runs a service that helps households lower utility bills, found that the average past-due amount by those in its network was roughly $850.
The crisis has emerged as one of the repercussions of the recession that was touched off by the viral pandemic. Though the economy has achieved considerable gains in recent months, about 9.5 million jobs remain lost. And many people have lost income even while remaining employed, leaving them unable to buy food, pay rent or afford utility bills.
President Joe Biden’s $1.9- trillion rescue aid package, enacted into law this month, will provide some support. It includes $5 billion earmarked for people who need help with power and water bills. Combined with other Government financing allotted for energy aid since the pandemic began, the total available to help struggling households pay utility bills is about $9.1 billion.
But all that assistance represents just a fraction of the $27 billion in past-due balances of US households, according to the National Energy Assistance Directors Association, which helps low-income consumers. The aid will be distributed through the Low Income Home Energy Assistance Programme.
Caught in the squeeze are people like Paula Desper, who lives in Lancaster, Pennsylvania, with her husband and the youngest two of their five children, ages 7 and 10. Desper worries about how her family will manage once the utility shut-off moratorium lifts soon in Pennsylvania.
“It’s come to the point where I look at a bill, and either I’m going to pay a bill or I’m going to buy food,” said Desper, 45. “I’ve got two little children. I will go without food. My children will not.”
After the pandemic erupted, Desper’s weekly hours and income were reduced by half. Her husband’s work hours were cut, too. Unable to afford his car payments, he lost his vehicle.
With their sharply reduced income, Desper and her husband fell nearly $700 behind on energy bills and more than $1,100 behind on mortgage payments. In the meantime, she worries about being exposed to COVID at work, particularly because her 10-year-old daughter has asthma.
“I always wanted to do better for my children, and I feel guilty,” Desper said. “I have my moments where I cry because I feel hopeless. I feel like I did something wrong, even though I know it wasn’t my fault.”
Officials at agencies involved in financial aid for energy customers say the problem has become an urgent one.
“We have never had debts of this size before,” said Mark Wolfe, executive director for the National Energy Assistance Directors Association, which estimates that the total amount due has soared from roughly $11 billion, owed by nearly 20 million US households at the end of 2019, to the more than $27 billion now.
Those findings mirror the study of electricity bills in 13 states and the District of Columbia by Arcadia, which helps households find renewable energy sources to lower their utility costs. It found that one-quarter of the households belonging to Arcadia’s network in those states had past-due balances on their electricity bills as of January, with the average amount owed nearly $850 — a 67 per cent jump from the end of 2019.
Even bigger past-due bills have been emerging in New Jersey, said Kathy Kerr, director of utility assistance for the Affordable Housing Alliance. Before the pandemic, people who approached the organisation seeking help typically had past-due balances of $800 to $1,000. Now, she said, it’s not uncommon to see past-due balances ranging between $2,000 to $3,000, reflecting a crisis that cast millions of people out of jobs, especially at restaurants, gyms, concert venues and small businesses and left them consuming more electricity at home.
“People are at a crossroads,” Kerr said. “Do I pay rent? Do I pay bills?”
Moratoriums on shutting off power for past-due households had existed in at least 35 states at some point during the pandemic. In response, some struggling consumers chose to funnel their money toward housing, food and other obligations because they knew they wouldn’t lose their electricity or natural gas even if they skipped their utility payments.
Compounding the problem, American households have been using, on average, 10 per cent more electricity during the pandemic lockdowns, which have kept them home more hours, with computers and other electronic devices, along with heat or air conditioning, swelling utility bills.
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