Utility bills

Utility bills have been a double dose of pain for many Americans this year. Rates have gone up while their ability to pay has gone down. Now, utilities say they're shutting off power to a record number of households.

According to USA Today, utilities in Illinois, North Carolina, New Jersey and Arizona have seen disconnection rates soar this year. 

Utilities say they try to help customers avoid disconnection with payment plans, referrals to social service agencies and grants to pay bills. This fiscal year, the federal Administration for Children and Families distributed a record $5.1 billion to states to help low-income households pay energy costs.

But it's worth taking a closer look at how your local utilities manage late or missing payments. Remember the story of the Michigan man who froze to death after failing to pay his heating bill? It turns out the elderly man had plenty of money but routinely fell behind on his utility bills. The power company had no system for checking up on late payers before cutting them off.

Why are rates so high, anyway, when oil prices are so low? It depends on where you are. In some places, what customers paid for this winter was energy the utility companies bought last year at record high prices. In others, drought has made it more expensive to produce hydroelectric power. It's worth investigating and explaining exactly why energy bills have gone up in your area and what utilities and state regulators are doing about it.

Some utilities have offered customers a payment plan that would charge them equal amounts each month. Is that a good deal? Find people who will let you compare last year's monthly average bill to what the company is offering.

What can consumers do if they can't pay their bills? A federal program offers energy assistance through state agencies. Applications, eligibility rules, types of assistance and benefit levels are different in each state. What support is available in your area? How difficult is it to get help?

Some utilities also provide funds to help people pay their bills, but the programs vary widely state to state. One Oregon utility charges an assessment on gas bills; in Washington, D.C., customers make donations. But in Idaho, utilities say state law prohibits them from giving customers a break on rates. What does your utility offer? Where does the money come from? How does it get to the people who need it?

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