The Pandemic and Rising Utility Bills

A look into how the pandemic has contributed to rising utility bills.
The Pandemic and Rising Utility Bills

The pandemic changed the way most Americans live their everyday lives. In a matter of weeks, most people went from commuting freely to being on lockdown without any certainty in the foreseeable future. 

One of the most significant changes many Americans experienced is the impact the pandemic had on work-life balance. While work-life balance improved for some, it disappeared for others. 

Covid-19 and stay at home orders

The Covid-19 pandemic brought many changes to our lives, one of the biggest ones was operating costs for individual families. Before the pandemic, families relied on their workplaces and schools to provide utilities like wifi and electricity, sometimes even food amenities or food assistance programs for young children. 

Since the onset, consumers have found themselves using more electricity due to stay-at-home orders. Now that people are home most of the time, either working from home or doing school from home, power companies see higher usage across all utilities for most households. 

Consumers are spending most of their free time at home, which means entertainment costs have also caused utilities to become more expensive. 

Staying home means more devices are in use, particularly during peak hours. The AC and heater are now running for longer hours, as are other appliances in the home. 

A year and a half after the pandemic first began, utility bills continue to rise for many families across the country. Homeowners and renters alike find themselves demanding answers from local energy companies for the increase in their statements. 

Some consumers say their energy bills are 2-3 times higher than during the hot summer months of 2020 when their AC units ran on cooler temperatures for more extended periods. Thousands of Americans are reporting unusually high utility bills.

Some energy companies like Duke Energy in North Carolina have summed the increases to an increase in use and the changing weather conditions. According to national weather data, temperatures from 2020 to 2021 have changed drastically. Winters are now colder and summers increasingly hot. 

For example, in North Carolina, the average temperature during January 2020 was 46.9 degrees, while in January 2021, the average temperature was 41 degrees meaning this winter was 6 degrees colder. 

Winter 2020 for North Carolina included ten days with temperatures above 60 degrees. In contrast, 2021 only had one day in winter above 60 degrees. This indication points to cooler days during this year's winter season, and the trend has continued during this year's summer months. 

The country certainly saw what this year's winter brought forth. Texas suffered a major power crisis resulting from three severe winter storms that left Texans facing record-low temperatures this past February. 

The power outage left millions of Texans without power as the state's electric grid operator lost control of the power supply. This incident resulted in over 100 deaths and left hundreds of thousands lacking power. 

An incident of this magnitude left many consumers raising questions about the state's energy infrastructure and its oil and gas industry regulation. 

Economic relief post-pandemic  

The public health crisis and resulting economic crisis created several challenges for families across the country. At the start of the pandemic, local and federal governments ordered all non-essential businesses to close, leaving many Americans unemployed. Families found themselves in economic distress, looking to receive financial relief assistance from the federal government to carry them through uncertain times. 

In response, the federal government put in place moratoriums to protect Americans facing economic hardship. The moratorium's purpose was to remove the pressure created by financial hardship and make it possible to resume activities of daily living, in this case, for families. 

What is a Moratorium?

In its most basic definition, a moratorium is a temporary prohibition of an activity. Due to the economic instability brought about by Covid-19, the federal government put in place an emergency pandemic protection plan that included moratoriums or deferments for several expenses. These included rent, home foreclosures, utility bills, and student loan debt. 

For instance, the U.S. Centers for Disease Control and Prevention (CDC) put in place the rent moratorium to prevent evictions and the spread of the virus. Since being signed into order, the CDC extended the rent moratorium several times. The last extension signed by Dr. Rochelle Walensky, director of the CDC, provides Americans protections until July 31st, 2021. 

In essence, moratoriums delay payments and should not be confused with a grant. When suspensions come to an end, residents must pay all past due amounts to keep utilities running. Once a moratorium has ended, utility companies are not required to keep utilities running for customers with past unpaid balances. 

The situation has left millions of Americans at risk of being shut off completely. An estimated 205.4 million people across the U.S. are already at risk of utility disconnections.

According to the U.S. Census Bureau Household Pulse Survey, more than 80 million Americans are having difficulty paying their bills during the pandemic. 

Are my bills subject to a moratorium?

There are several resources to help consumers stay informed with moratorium mandates. The national association of regulatory utility commission (NARUC) has a map of disconnection moratoria by state and was last updated in March 2021. 

What to do if you can't pay your utility bills

Apply to the U.S. Department of Energy's (DOE) Weatherization Assistance Program (WAP). The WAP reduces energy costs for low-income households by increasing the energy efficiency of the homes while ensuring the resident's health and safety. It is the nation's single largest residential whole-house energy efficiency program. WAP has created an industry, producing new jobs and technologies while helping the most vulnerable families across the country.

What Energy Companies are doing to help

As a response to the pandemic, energy companies across the country created programs to help Americans manage their utility bills. Under the moratoriums put in place, if you experienced a change in financial circumstances due to Covid-19 and are a residential customer, your service could not be disconnected for non-payment. 

As moratoriums have come to an end in many states, energy companies have offered to waive late fees and provide payment agreements that require no down payment, late fees, or penalties. The question remains, is it enough to provide Americans economic relief? 

A nudge in a more frugal direction 

We've come a long way since the pandemic first started. With a sweeping effort to vaccinate most of the population, many people are resuming their lives to what they were pre-pandemic. 

Unfortunately, with a new covid variant on the scene, some officials seem to think we're on our way to another lockdown come fall. 

Although the government has provided some economic relief during the pandemic, families are still unclear about what the future may bring. 

A good way families can prepare is to look where they can cut expenses and remain in the clear. 

How can families do this? Begin looking at their burn rate. 

What is burn rate?

Burn rate is the amount of gross income spent on taxes plus living expenses. How much of what you earn do you burn? A family's burn rate includes living expenses, entertainment, and other wants.  

But why calculate your burn rate? Well, burn rate can translate into your utilities and any other expenses you cover. Looking at it helps families start looking at costs under a closer lens. An excellent example of this is your energy bill. Looking at it forces you to beg the question, why is it so high, and what can I do to improve my monthly bill? 

PowerX can help

PowerX created its products around the idea of giving consumers the full story of their utility usage, showing them in real-time what they're spending and how to save. 

It might seem counterintuitive to consider buying a product to help save money, but finding the right ones could offset the upfront investment in the long run. 

PowerX smart sensors help homeowners save money by identifying areas of spending that could improve with a few changes in behavior and monitoring. Machine learning uses data to determine which devices are the most wasteful and provides actionable solutions to make your home more efficient.

We want to help families across the globe get clear on their utilities while helping paint a better picture of their carbon emissions footprint. 

While the pandemic is sure to come to an end, the desire to continue saving wherever possible and our collective concern for the planet should not. 

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