America’s Energy Nightmare About to Get Worse – 6 Million Families may Need Help Paying Their Electric Bills (Part 1 of 4)
Posted: June 9, 2008
As if record gasoline prices weren’t causing enough consumer pain, Americans are expected to face skyrocketing electric utility bills this summer that may force as many as six million low- and middle-income families to seek government and utility assistance, twice as many as historically seek aid. Some could even die.
That’s according to Michael Wolfe, executive director of the National Energy Assistance Directors’ Association (NAEDA), which represents the state directors of the federal government’s Low Income Home Energy Assistance Program (LIHEAP). “You’re talking about 30 million families, a third of all families” in the U.S., Wolfe told EnergyTechStocks.com as he emphasized that every U.S. household with an income of about $35,000 a year or less could feel the pain.
Asked if there could be a repeat of Chicago – a reference to the tragic incident in 1995 when hundreds of people died in a heat wave because they lacked air conditioning – Wolfe said, “We could,” though not specifically in Chicago. He noted that many Americans already are behind on their electric bills, and that some utilities have gotten aggressive in their collection efforts. He further noted that government protections against customer shut-offs by utilities were created for winter, not summer conditions. Even in a normal year, Wolfe added, a few hundred thousand families usually have their power turned off.
As reported last week by EnergyTechStocks.com, U.S. electric rates are expected to soar as the price of natural gas soars and as the nation’s failure to build new baseload power plants forces older, higher-cost power plants to be pressed into greater service. (For more, see Already Stunned by Gas Prices, Shockingly High Electricity Prices May Await Americans This Summer)
The fact that record numbers of Americans will need help to pay their electric bills this summer clearly adds to the energy nightmare building in the U.S. As painful as $4-a-gallon gasoline is proving to be, at least with gasoline many Americans have options, such as carpooling and taking public transit. With electricity, there are no options. As America’s energy nightmare builds – first gasoline, then electricity, with more still to come – the stock market and the economy as a whole are entering uncharted territory. Only time will tell how much American families cut back on spending in order to keep the lights on, and how that will affect American businesses.
Wolfe said that because of their economic standing, families in major cities such as Detroit, New York, Chicago and New Haven, Conn. probably will be most in need. How much financial help will be available is an open question. Congress and the White House still need to sign off on measures that would add to LIHEAP’s available funding this summer. Without that additional money, NAEDA has warned that millions of families will face the threat of shut-offs.