One in six U.S. homes, or 20 million households, have fallen behind on their energy bills as power prices rise and inflation eats up incomes, Bloomberg reports, citing data from the National Energy Assistance Directors Association (NEADA), which has said this is the worst crisis it has ever documented.
In June, NEADA had already warned that “Electricity prices are expected to increase significantly this summer as result of rapidly rising natural gas prices, a primary feeder fuel for electricity and a warmer summer creating additional demand for electricity.”
A total of 19.9% of all U.S. households reported that they kept their home at a temperature that felt unsafe or unhealthy for at least one month in the last year, according to the Census Household Pulse Survey, covering April 27 – May 9, 2022, cited by NEADA at the start of this summer.
Now there will be “a tsunami of shutoffs,” Jean Su, a senior attorney at the Center for Biological Diversity, which tracks utility disconnections, told Bloomberg.
Electricity prices in the United States have surged in recent months due to the rise in natural gas prices, which briefly hit on Tuesday $10 per million British thermal units (MMBtu) for the first time since 2008. Natural gas has the largest share of U.S. electricity generation, so the rally in U.S. benchmark gas prices is driving up electricity bills, too.
Last year, the average nominal retail electricity price paid by U.S. residential electric customers rose at the fastest rate since 2008, increasing by 4.3% from 2020 to 13.72 cents per kilowatt hour (kWh), according to data from the EIA.
In July this year, the average price U.S. households have to pay jumped by 15% year over year, for the biggest annual rise in data since 2006, according to Bloomberg.
Consumers in Europe are seeing even larger increases in their electricity bills as the energy crisis there is much more acute, with low and uncertain Russian gas supply driving gas and power prices to record highs.
By Michael Kern for Oilprice.com
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