Household Electric Bills Skyrocket

Trends on the physical side of sustainability indicate price increases for heating, cooling, electricity, automobile fuel, water, etc.  But – unless prices jump suddenly, we don’t do much about it.

Food is the biggest concern.  It won’t just be a matter of price;  at some point, many supermarket shelves may be empty.  It’s never happened in this country;  people don’t believe it’s possible.  Corrective action – things to do so the crisis never happens – is difficult to “sell.”  From the December 13, 2011 USA TODAY comes a clear statement, by Dennis Cauchon, of the escalation … and likely continuing escalation of electricity prices.

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Electric bills have skyrocketed in the last five years, a sharp reversal from a quarter-century when Americans enjoyed stable power bills even as they used more electricity.

Households paid a record $1,419 on average for electricity in 2010, the fifth consecutive yearly increase above the inflation rate, a USA TODAY analysis of government data found. The jump has added about $300 a year to what households pay for electricity. That’s the largest sustained increase since a run-up in electricity prices during the 1970s.

Electricty is consuming a greater share of Americans’ after-tax income than at any time since 1996 — about $1.50 of every $100 in income at a time when income growth has stagnated, a USA TODAY analysis of Bureau of Economic Analysis data found.

Greater electricity use at home and higher prices per kilowatt hour are both driving the higher costs, in roughly equal measure:

•  Residential demand for power dropped briefly in 2009 but rebounded strongly last year to a record high. Air-conditioners and household appliances use less power than ever. A new refrigerator consumes half the electricity as a similar one bought in 1990. But consumers have bigger houses, more air-conditioning and more electronics than before, outpacing gains in efficiency and conservation.

“People have made a lot of money selling weight loss programs. It’s the same for energy. Behavior is hard to change,” says Penni Conner, vice president of customer care at NSTAR, a Boston-based utility.

•  Prices are climbing, too, hitting a record 11.8 cents per residential kilowatt hour so far this year, reports the Energy Information Administration. The increase reflects higher fuel prices and the expense of replacing old power plants, including heavily polluting — but cheap to operate — coal plants that don’t meet federal clean air requirements.

“Higher bills are a huge problem for low income families,” says Chris Estes, executive director of the North Carolina Housing Coalition, which opposes a proposed rate hike in its state by Duke Energy. “Utilities are what people’s budgets start with.”

Duke Energy says the rate increase is needed to pay for replacing old power plants and making the transmission system more reliable. The Charlotte-based utility has reached a tentative agreement with North Carolina to raise rates 7.2% in February, lower than its original 17% request.

“The industry as a whole is facing higher costs because we’re retiring our aging fleet” of power plants, says Duke Energy spokeswoman Betsy Conway.

Electricity cost varies widely depending on where you live. Cheapest: Northwest communities near hydropower dams — as low as 2 cents per kilowatt hour. Most expensive major utility: Consolidated Edison, supplier of New York City — 26 cents per kilowatt hour, according to EIA.

High taxes, limits on air-polluting fuels and the expense of maintaining an underground transmission system keep consumer costs high, says ConEd spokesman Chris Olert.

A potential bright spot: Electric bills appear roughly the same so far this year as last when adjusted for inflation, based on preliminary reports.

However, the future of energy prices and the upcoming closure of more polluting coal plants makes the long-term outlook cloudy for consumers. Duke Energy plans to ask for another rate hike next year to cover the costs of new natural gas-fired plants.

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Utilities are private corporations enjoying a monopoly.  To ensure their service and pricing is fair, governments established utility commissions that, in theory, look out for the public good.  In practice, that may not be true.

Initial Garden Atrium sustainable homes use natural gas for cooking;  most cooks seem to prefer that.  Utility bills ran about $3.00 a month, as cooking was the sole natural gas use.  (Heating and hot water are solar.)  Suddenly, utility bills jumped to over $21.00 a month;  the utility commission approved a “service fee” of nearly $20.00 … just for being hooked up.

If the natural gas utility needed additional maintenance revenue, they could have increased the price of natural gas … as gasoline and electricity providers do.  A flat service fee has no discernible impact on major users, but was a 700 percent increase for small users.  The approach penalizes sustainability.

Efforts to contact the utility commission, requesting an explanation – by phone, email, or letter – received no response.  Conclusion:  utility companies control the utility commissions.

Many sustainability movements aim at influencing government policy.  Ultimately, sustainable living has to be accomplished by each of us … not by hoping “someone up there” will take care of us.  Remember …

If a frog is placed in a pot of hot water, it’ll jump out.

But, if the water is heated slowly, the frog

will sit there until it boils to death!

Long-proven technology for eliminating utility bills exists.  Two booklets from our web site detail how to slash utility bills.  Many of these blog postings list additional things you can easily do.  It’s up to each of us to act … not to sit in water as it’s being heated … but to ACT.

One thought on “Household Electric Bills Skyrocket

  1. What would be the break-even point, to switch to a propane tank, change the burners if needed(if possible), etc?
    How much usage would you need, to make a natural gas hookup more cost effective than a propane tank.

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