Bigger Utility Bills on the Horizon Thanks to Pandemic
According to a D.C.-based analytics company, households in 13 of largest U.S. metro areas are likely to see an approximate rise of 10% in their summer electricity bills. The increase, if it indeed does come about, it will be the result of factors introduced by the COVID-19 pandemic.
Citing their analysis of utility bill histories, Arcadia (a Washington, D.C.- based startup that connects subscribers to clean energy projects) is predicting that these metro areas (wherein one in three Americans in the U.S. live) are going to see more than $2 billion total summer bill increase.
Based on Arcadia’s breakdown, households in Philadelphia are likely to be hit hardest, with a nearly $40 in monthly increases. Households in New York City, Boston and Detroit will see increases of $34, $27 and $23 a month, respectively.
Increases Likely to Vary by Region
“What we are presenting is a conservative estimate,” said Owen Quinlan, vice president of data analytics at Arcadia. He added that all this is assuming that electricity rates do not go up anytime soon. Quinlan says that his company’s analysis “probably understates potential summer bill increases, because last year’s baseline summer period data does not include as much home cooling as will be needed this summer, with more people working at home due to COVID-19.”
The level of expected energy use is likely to vary from city to city, according to Arcadia. Cities with higher population concentrations, like Philadelphia and New York, will see the highest rate increases, while those in cities like Seattle and San Francisco will see smaller increases in their monthly rates.
It’s COVID’s Fault, but Weather a Major Factor
According to Arcadia’s analysis, weather is the biggest driver of home heating and cooling, with heating and cooling being the single largest drivers of energy use in the home. So it isn’t hard to see how households in the Northeast will see larger summer bill increases and why households in milder climes are likely to be less affected.
Quinlan’s company estimates that “per household monthly summer bill increases in San Francisco and Seattle will be about $8 and $2, respectively.”
With many coronavirus restrictions still in place, and many cities restoring restrictions that had been lifted or partially lifted, it seems that an increase in residential energy use is inescapable. In this scenario, many people working remotely will continue to do so throughout the summer.
“We’ve changed our normal [working] patterns,” Quinlan says. With the electricity cost burden shifted from employer to employee during working hours, this is going to translate into more energy needed for cooling this summer, particular in hotter regions.
Unemployment, which has also reared its ugly head as a result of the pandemic, has also played a large part in increased residential energy use. Those who’ve lost jobs or been temporarily furloughed sue to COVID-19 may be dedicatedly looking to make up their income, but a lot of that prospecting is going to be done at home.
Similarly, in areas of high population density, with social distancing and stay-at-home measures are in place, many residents’ recreational venues are no longer accessible, leaving home as the only option. This of course results in even more energy use in the home.
Ongoing Cashflow Concerns
Given the on-again, off-again nature of the pandemic restrictions being rescinded and restored, of course many energy customers remain concerned about their ability to pay utility bills. While many providers’ COVID-19 relief programs are ending this summer, others are trying to accommodate customers (beyond their earlier intended restoration of fees and disconnections), since the virus obviously intends to remain around for at least a bit longer.
Utility customers who are worried about paying their utility bills throughout this crisis are advised to contact their provider. Many major providers such as ConEd, Duke Energy, FirstEnergy and PSE&G are offering programs that provide monthly discounts for families who fall below certain income thresholds. There’s also the Low Income Home Energy Assistance Program (LIHEAP), a federal program for low-income families that helps with energy bills.