Past Due Energy Bills

More homes than ever before in the United States are facing late energy bills – sometimes totaling thousands of dollars – and are at risk of experiencing a shutoff by their utility provider.

But while the pandemic and rising energy prices hadn’t expanded the number of homes facing past due amounts, the amount of money owed in past due bills have gone up significantly – on average 70%.

According to the National Energy Assistance Directors Association (NEADA), about 1 in 6 homes across the United States have past-due energy bills. That’s approximately 20 million households that are at substantial risk of having their power shut off, and losing the ability to keep their homes habitable.

The amount of money owed on past due utility bills have doubled in the past two years as natural gas prices have skyrocketed – electricity prices rose 15% in the past year alone. And NEADA’s analysis of energy price data shows across the country the average cost of home heating increased by almost 38 percent, from $888 during winter in 2020 to $1,224 this past winter.

Another factor has been the lasting impact of Covid-19. Low-wage workers have struggled to make up financial ground lost during the pandemic recession and are now facing the largest year-over-year electricity price increase since 2006.

In Colorado, the number of households that are behind in their energy bills as of 2021, was 1 in 4 homes, according to a study from Arcadia, a company connecting users with wind and solar power. But while the pandemic and rising energy prices hadn’t expanded the number of homes facing past due amounts, the amount of money owed in past due bills have gone up significantly – on average 70%. Using their data, Arcadia estimated in just two years the past due amounts owed on utility bills increased by over $100 million.

Who is facing past utility bills?

Families face energy insecurity across the country – but the burden falls significantly on households of color, and homes with at least one child.

According to Indiana University’s Energy Justice Lab, from November 2021 to February 2022:

4%

of the homes that couldn’t pay their energy bill were African American

4%

of the homes that couldn’t pay their energy bill were Hispanic

7%

of the homes that couldn’t pay their energy bill had children under 5

Study after study has shown homes facing disconnections will keep their homes at unsafe temperatures to reduce their utility bills and forego things like medical care and food to keep their power on. And when the power does go off in a home, it becomes unsafe to live in.

More funding on the national, and local level

NEADA has asked Congress to approve an additional $5 billion in funding for the Low-Income Home Energy Assistance Program (LIHEAP) to ensure there is enough money to help income-qualified residents cover the increased heating costs this winter.

Across the U.S., states have ended disconnection moratoriums put in place at the start of the pandemic, including here in Colorado. But there still are protections for homes facing disconnections, including ones Energy Outreach Colorado advocated for during recent legislative sessions.

  • An energy user with a medical certificate could postpone disconnection of their utility or heating service for up to 90 days, once a year.
  • In 2021, the state Legislature increased funding for low-income energy assistance programs to be administered by EOC. Colorado investor-owned utilities added a small monthly charge to their utility bills to pay for the increase, with a portion of the money going to energy assistance for SNAP clients with the hope of increasing applications to LEAP.
  • In 2022, the CO State Legislature passed restrictions on utility disconnections, preventing shutoffs during emergencies, extreme weather events, or on Fridays, Saturdays, Sundays, and state or federal holidays. HB22-1018 also mandates if a customer requests a reconnection between Monday to Thursday, the utility must reconnect their service.

To read more about the current crisis, check out A ‘Tsunami of Shutoffs’: 20 Million US Homes Are Behind on Energy Bills”  
by Will Wade and Mark Chediak, Bloomberg 8/23/22