Increases in Utility Bills May Price Out Low-Income Families from Basic Human Needs
With the rising cost of utilities, more and more families are being priced out of heat, electricity, and water—basic and essential human needs.
Chicago families, like many American households, are being hit on all fronts. Electricity costs are going up. Water rates are skyrocketing, with black Chicagoans and poor families paying the most. And just this month, despite pushback from advocates and community members, the state utility regulator gave their blessing to a multi-billion dollar infrastructure project called the System Modernization Program (SMP) for Peoples Gas, which will be paid for by Chicago families.
This infrastructure project is expected to double gas bills over the next 20 years. Chicago households currently pay on average $1,200 annually for natural gas; our bills are expected to rise to $2,900 annually. While the cost increase is spread out over decades, families simply do not have the money to pay for it.
The Peoples Gas project is ostensibly aimed at improving public safety by replacing Chicago’s aging gas pipes. Yet the project will put the burden of improvements to this system on the people who can afford it the least.
This cost increase will most severely impact people experiencing poverty and people of color. Our 2017 report on poverty in Illinois revealed that nearly half of Chicagoans are considered low-income or living in poverty, and people of color have among the highest rates of poverty in Illinois. This rate will hit these communities the hardest, taking an outsized portion of a family’s income just to pay for heat, and making it much more difficult to make ends meet every month.
When families can’t afford heat, their safety and wellbeing is at risk. A cost increase would cause many lower-income families to go without adequate heat during Chicago’s brutal winters. Disconnecting heat and electricity during the winter can be deadly. In Ohio, an elderly woman and her son recently died from hypothermia, after being disconnected from the electricity that supplied heat to their home. Tragic incidences, like this one, are avoidable if we work to ensure that utilities rates and payment plans are fair and affordable.
A 2011 study from the National Energy Assistance Directors’ Association found that 23% of LIHEAP recipients kept their homes at unsafe or unhealthy temperatures in the past year due to not having enough money for the energy bills. With this costly infrastructure project, we are likely to see more Chicago families adopt strategies like these – not turning on their heat, or keeping their home at unsafe temperatures – in an attempt to manage their expensive gas bills.
While the Peoples Gas project was recently rubberstamped and is moving forward, we expect that utility companies will continue to push for higher rates and the ability to collect more fees – both in Chicago and throughout the country – and we need to be ready to push back, and fight for fair and affordable utilities.
Too often, the voices of low-income individuals are left out of the decision-making process on utilities issues. In Chicago, we need more community members and organizations working for and with low-income families to engage in utilities advocacy. Heartland Alliance is partnering with Illinois PIRG and the Sargent Shriver National Center on Poverty Law to develop a coalition to do just that—elevate the concerns of people experiencing poverty and people of color, and advocate together for affordable utilities.
If you’re not already engaged in your local utilities issues, get involved. Learn about utilities concerns in your community. Weigh in on legislation or regulation. Join a coalition (or start one!) This is an overlooked area, but one that directly hits everyone’s wallet.
It is beyond time that we ensure that all Americans can afford the most basic necessities – water, electricity, and heat – and we will need a groundswell of leaders and advocates to make that happen.
Jody Blaylock is a Senior Policy Associate with Heartland Alliance