WASHINGTON–Credit unions might want to prepare for an influx of members seeking help with utility payments in the coming months.
A new analysis has found debts related to electric and gas bills could reach or exceed $20 billion by the end of 2020—debts many “may never be able to repay.”
During the early months of the pandemic a number of states put bans in place to prohibit power and utility companies from disconnecting customers behind on their bills. Now, just 21 states and the District of Columbia still have such disconnection bans in place.
That leaves roughly 179 million Americans at risk of losing service even as the economy continues sputtering, according to the National Energy Assistance Directors’ Association (NEADA), which is tracking the moratoria, the Washington Post reported.
“Millions more in nine other states are set to lose their protections starting (Oct. 1) and throughout the fall, the group found,” the Post added.
‘Severe’ Delinquencies
The NEADA said its analysis shows electric and gas debts alone will reach or exceed $24.3 billion by the end of the year, based on roughly two dozen states’ regulatory filings.
“In some cases, the delinquencies appear to be severe. In Indiana, for example, more than 112,000 households are behind 120 days or more on their power bills, a Washington Post analysis of the largest local energy companies’ records found,” according to the report.
The debt, totaling millions of dollars, is four times greater than the arrears accrued during the same period in 2019, the data shows, the Post noted.
The Post analysis noted utility companies generally are not required to disclose how many Americans are behind on their payments, and by how much, complicating efforts to study the effects of the pandemic and craft effective policy responses.
“You can’t really underestimate the burden of that debt on families,” Khalil Shahyd, a senior policy advocate at the Natural Resources Defense Council told the Post. “It’s also going to have wider ramifications for our economy and our ability to recover from this crisis.”
Senator Acknowledges Problem
Government relief at this point does not appear to be in the near future, although one senator acknowledged what many are feeling.
“The data paints a grim picture,” Sen. Thomas R. Carper (D-DE), top Democrat on the chamber’s Environment and Public Works Committee, told the Post, adding that lawmakers need to “come together and do something that brings relief to Americans who are hurting right now.”
The analysis found in one state, Wisconsin, for example, during August an average of three in 10 customers at five electric and gas utilities missed payments, totaling $235 million in arrears, state records show. That’s more than double the average rate registered in 2019, according to a presentation filed this month in a regulatory proceeding. As the coronavirus ravages the state, Wisconsin’s utility commission last month opted to extend its shut-off moratorium into next spring, aiming to protect public health and ensure that students stuck learning at home aren’t trying to do so in the dark, the Post said.
In Nevada, more than 68,000 Nevada residents and small businesses were behind on their payments last month.