Tsunami of Shutoffs Expected for 20 Million Families Behind on Energy Bills

Millions of families across the U.S. are facing utility shutoffs for heat and electricity. The costs for both have soared. As the major energy oligopolies, such as Exxon, reap billions in profit, families are forced to go without heat or, during recent heatwaves, air conditioning.

It is currently estimated that 20 million homes across the U.S. -- about one in six homes -- have fallen behind on their utility bills. Power bills for many have more than doubled over the past year. The average price people pay for electricity increased 15 per cent in July from a year earlier, the largest 12-month increase since 2006. And most expect these increases will continue.

U.S. households owe about $16 billion in late energy bills, double the pre-pandemic total. The average balance owed has increased 97 per cent since 2019, to $792. According to the National Energy Assistance Directors Association, it is the worst crisis the group has ever documented. A main reason is the giant surge in electricity and natural gas prices, set by these oligopolies. A tsunami of shutoffs for millions is now expected.

While millions face shutoffs, the energy oligopolies continue to rob tens of billions of dollars of the wealth produced by the workers. The second quarter for 2022 alone showed more record profits. ExxonMobil grabbed $17.9 billion, its largest-ever quarterly profit. Chevron also secured huge amounts.

The record profits are not reserved for U.S. oligopolies alone. British Petroleum (BP) posted profits of $8.5 billion, its biggest grab in 14 years. London-based Shell and France's TotalEnergies also recorded similar results. Put together, these five major oligopolies plundered $55 billion in just the second quarter, as hundreds of millions of people around the world bore the brunt of the surging prices these oligopolies set.

For the U.S., while rates vary from state to state, everywhere people have faced big increases. California's PG&E Corporation has seen a more than 40 per cent jump since February 2020 in the number of residential customers behind on payments. New Jersey's Public Service Enterprise Group, a private corporation, has more than 30 per cent of families at least 90 days late -- and that is just since March. Similar figures exist across the country.

In the U.S. most utilities, like electricity and natural gas for heating, are private monopolies, able to set prices because of their monopoly position in the economy. The government, far from guaranteeing there are no shutoffs of these necessities, instead provides funds to the private utilities for what they say is assistance to families. But like most government subsidies to the rich, including many of the COVID-related funds, there is no guarantee people will actually benefit. In addition, state regulators often allow these private utilities to recover their losses by adding a charge for people who can pay their bills, alongside providing public funds. While state regulators play a role in setting prices, it is rare that they block requests by the monopolies for increases.

Heatwaves like those experienced this year, with 100 million people facing heat alerts, are also heightening the risk that, for some people, losing power will prove fatal. Currently 41 states have some sort of protection against utility shutoffs during the winter, commonly only that the shut off is postponed, not eliminated. Only 19 states have laws or regulations preventing disconnections in sweltering hot weather. Already, on average there were 188 heat-related deaths a year in the U.S. from 2017 through 2021, up from an average of 81 in the five years before that. Many are seniors, forced to fend for themselves.

In many cities, like Detroit, people have fought for moratoriums on water and utility shutoffs and secured them. As well, during COVID, some states had moratoriums. However, like Detroit, many of them are now ending. Organizing to demand the human rights to electricity, heat, and water is increasing. One way for the government to guarantee no shutoffs is to nationalize all utilities and make them public enterprises serving the public interest.

This article was published in
Volume 52 Number 9 - September, 2022

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