Forbes


Oil & Gas 360 Publishers Note: Nice article by Scott Carpenter, Forbes, about the rising costs of electricity to the lower income group of Americans. What many people do not realize is that the additional cost burden for solar and wind per kilowatt hr are passed through to the consumer. -” I’m just saying” 

In the United States, this summer has already proved unusually hot. Now a long-lasting and potentially record-setting heat wave is expected to settle over much of the southwestern U.S. this weekend before spreading to the rest of the country, according to official forecasts.

The heat wave will take two weeks or longer to dissipate, forecasters expect.

“Hot and humid conditions are likely to persist with much-above-normal temperatures predicted for much of the country during the last two weeks of July,” the National Oceanic and Atmospheric Administration said today.

For many Americans, the timing could not be worse.

America’s public spaces and offices are still mostly closed due to the COVID-19 pandemic, depriving Americans of cool places of refuge such as shopping malls and movie theaters, and instead forcing them to crank up air-conditioning units inside their homes. For low-income families and the 11.1% of the workforce that is unemployed, air-conditioning will either be a luxury they can’t afford or a burden that pushes them closer to financial ruin.

Energy bills in much of America “will be much, much higher,” said Cisco DeVries, a former White House aide and the CEO of OhmConnect, a company that helps households manage power demand. “With sheltering in place, people aren’t leaving their homes to seek air-conditioned refuge elsewhere, so they will be heavily reliant on their units to cool down their homes.”

The Department of Energy forecast a week ago that the unusually hot summer could increase energy bills by 25% for as many as 50 million Americans, but if the heatwave lasts as long as many forecasters now anticipate that figure could climb higher.

heatwave-energy-costs - oilandgas360 - forbes

Even before the pandemic struck, putting millions out of work, many would have been hard-pressed to make their monthly payments for utilities: according to government data, more than one in three US households struggle to pay their utility bills. In at least one year, 2015, as many as 14% reported receiving a disconnection notice for energy service.

For middle- and high-income families, paying monthly utility bills is often an afterthought. But for low-income families, payments to keep the lights on, do a load of laundry or run an air-conditioning unit — the latter accounting for the largest share of residential electricity costs in 2019 — consume a significant portion of income. Low-income households spend more than 7% of their income on energy bills, compared with only 2.3% for high-income households, according to a 2016 study by the Natural Resources Defense Council, a non-profit.

Black and Hispanic Americans, who account for a disproportionate share of low-income households, are set to absorb the brunt of any new financial burdens the heat wave will create.

“As conditions heat up across the country over the next week or two, and whenever heat strikes this summer, black and Hispanic people, and communities with large black and Hispanic populations stand to be hit hardest by the compounding threats of extreme heat and COVID-19,” according to researchers at the Union of Concerned Scientists, a non-profit science advocacy group.

As part of its response to the economic crisis unleashed by the pandemic, the government has sent checks of $1,200 to much of America and funded unemployment benefits of $600 per week as part of the CARES Act. A portion of CARES Act funding was aimed at helping families afford utility payments.

But those benefits are running out. If Congress extends them, Forbes.com reported earlier today, it is likely to reduce the size of weekly payments.

Some are calling for special relief for Americans whose struggle to afford payments for utility bills will increase as the heat wave sets in.

DeVries, the former White House aide, has argued for special relief funds, citing as an example Texas’ Electricity Relief Fund, which was created in March as a way to encourage power companies not to disconnect households in financial hardship. And the Union of Concerned Scientists has called for expanding the eligibility criteria of the Low-Income Home Energy Assistance Program (LIHEAP), which excludes people with income of up to 150% of the federal poverty level (depending on the state) and those who live in public housing where rent covers energy costs but who still don’t have A/C units.

The worst of the coming heat wave will reach states like Arizona and Texas in the next couple days. But even regions like the Midwest are already suffering. In St. Louis, Missouri, a group called Cool Down St. Louis, which helps low-income families with utility bills, has received three times the usual number of calls for assistance, regional news station KMOV4 reported yesterday.


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