Utility Debt Skyrocketing And Millions Face Shutoffs as Moratoriums End

The number of individuals who are falling behind on their utility bills is skyrocketing, according to an analysis conducted by the National Energy Assistance Directors’ Association, especially as moratoriums that have been put into place during the coronavirus pandemic are expiring.

On July 31, the estimated amount that was owed by individuals who had fallen behind on their electric bills was between $8 billion and $10 billion and $975 million and $1.3 billion for those who were behind on their natural gas bills. By the end of the year, those numbers are grow by as much as $15 billion for electric bills and $4.7 billion for natural gas bills.

More than 20% of customers nationwide are now behind on their utility bills, according to the analysis. As the summer cooling season ends and the winter heating season begins, that number is expected to increase.

Twenty-one states — along with the District of Columbia — have moratoriums in place that prevent a household’s utilities from being disconnected, but the moratoriums in nine states are set to expire this month. That leaves as many as 179 million Americans at risk of having their gas and/or electric shut off, according to an article in the Washington Post, which was based on the NEADA’s analysis.

The problem is twofold. Not only are consumers on the brink of losing their electricity or natural gas services, but the utility companies are facing sharp declines in their revenues, which could lead to higher prices or other potential consequences.

“All the dominoes are about to fall,” said Elizabeth Marx, the executive director of the Pennsylvania Utility Law Project, which advocates on behalf of low-income residents in need, said in the Post article. “When you lift the moratorium, those households that are struggling will be worse off.”

Thirty per cent of consumers in Wisconsin are behind on their utility payments, according to the Post, double the amount who were delinquent a year ago. In Nevada, the amount of arrears is four times higher than it was a year ago. The moratoriums may have stopped the bills from being collected, but they did not stop the bills from being added to what the consumers owed.

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