Utilities have long been on the forefront of providing and facilitating assistance to help the most vulnerable and economically at-risk segments of the population manage the cost of energy. Over time utilities have built programs, capabilities, and partnerships with government agencies and community organizations to meet this goal.
A confluence of factors has put that model to the test.
First among these is (of course) the COVID-19 pandemic which, well into its second year, continues to threaten the health and economic viability of the population and business community. We are all well aware that this has put great pressure on vulnerable segments of the population and small businesses. As of March of this year it was estimated that up to 37 million customers – or nearly 1/3 of all households – are dealing with overdue electric bills.
Utilities have stepped up, providing payment plan relief, late payment forgiveness, and moratoria on shutoffs for non-payment. But eventually someone has to foot the bill. The recent $1.9 trillion rescue aid package enacted in March is slated to provide $5 billion to assist with power and water bills. But according to the National Energy Assistance Directors Association, that tally is only a fraction of the estimated $27 billion in past due balances, and a growing number of households have fallen more than one year in arrears. To make matters worse, remaining shutoff moratoria are set to expire soon. On May 1, fifteen states had shutoff moratoria in place. That number dropped to eleven on July 1, and by the end of the summer only five states will have COVID-related moratoria in place. Utilities and their customers will have some difficult choices ahead.
Yet the pandemic is not the only factor putting pressure on the most vulnerable. This year, historic weather patterns in places like Phoenix, Los Angeles, Portland, and Seattle have created unprecedented demand for energy for cooling purposes. As is often the case, the most vulnerable are often the most heavily affected, but most poorly equipped to handle the financial impact. Hundreds of deaths have been attributed to recent heat waves, and as the data continues to roll in, we will likely find that many of those deaths are among vulnerable populations who struggled to access relief from the extreme heat.
So what can utilities and other stakeholders do, above and beyond the actions they have already taken, to manage through this crisis? What new and innovative options do utilities have to further support the most vulnerable segments of their customer base? And how can utilities create a win – win by further supporting vulnerable segments of the population while also driving other objectives like clean energy, energy efficiency, and improved reliability and resiliency?
Here are a couple of approaches that utilities, regulators, and community and charitable organizations can explore to address the challenge:
The need for energy assistance among our most vulnerable population has never been greater. New ideas and redoubled efforts are needed to overcome this challenge. The lives and livelihoods of our neighbors are literally depending on it.
Andy McKenna and Lili Gao are Utility Customer Experience Experts at PA Consulting
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