This article ties together an analysis of the COVID-19 pandemic, energy inefficiency, electric utility models, and exacerbated racial inequality in the southern US. Though many of the south's large utility companies have made progress towards energy transition, this has coincided a notable lack of investment in energy efficiency. In Alabama, Arkansas, Georgia, Mississippi and South Carolina, limited income communities use an average of 36% more electricity than in other locations. Thus, despite relatively low prices/kilowatt hour, the south east US is home to the highest energy burdens in the US, which disproportionately impacts limited-income communities of color.
In this article, the author notes that utilities are often hesitant to invest in technologies that will reduce electricity usage. This is most apparent in the south "where 19 utilities scored in the bottom half of ACEEE's [American Council for an Energy-Efficient Economy] efficiency scorecard." This lack of investment is often paralleled by limited-income residents, who are simply unable to overcome the initial costs of replacing an inefficient heater, AC, dishwasher, etc. However, the threat of climate change is motivating a change in the scene. Many utilities have sought to increase efficiency to help meet state mandates on carbon emissions reduction. Utilities are also coming up with new, creative solutions to help limited-income residents finance efficiency expenditures. Georgia Power's Pay As You Save program (PAYS) is perhaps the most interesting model. PAYS is basically a the same model that utilities use to finance a new powerplant, only in this case it is used to finance their customers' energy efficient homes and appliances: "A utility invests capital in customers' homes to make it more energy efficient and then recoups those costs on a monthly bill." Thus, this model effectively nullifies the upfront cost barrier to investing in energey efficiency while also providing incentives to low-income residents and renters by decreasing their monthly energy bills. "A $200-a-month utility bill might drop to $150 or $160 while the electric company is recovering its investment at the same time..." Georgia is aslo inspiring other utilities to experiment with similar models. North Carolina's utility giant, Duke Energy Corp., has recently aggreed to work along side the North Carolina Housing Coalition and North Carolina Justice Center to come up with a tarrif-on-bill model of their own.
That being said, Georgia has also recently suspended its moratorium on disconnections, leaving many limited-income communities of color facing insurmountable energy debts and impending shut offs. In return, energy and climate justice organizations have called out the utility (who has superficially supported the Black Lives Matter movement) for failing to put their money where their mouth is. Activists assert that the utility needs to go well beyond the PAYS program, "donating thousands of dollars toward weatherization programs for low-income homes and apartments; a workforce program to give people jobs; and making solar available to those who really need to lower their monthly bills."
Kristi E. Swartz, "How electricity deepens the South's racial divide", contributed by James Adams, The Energy Rights Project, Platform for Experimental Collaborative Ethnography, last modified 6 August 2020, accessed 25 April 2024. https://energyrights.info/content/how-electricity-deepens-souths-racial-divide
Critical Commentary
This article ties together an analysis of the COVID-19 pandemic, energy inefficiency, electric utility models, and exacerbated racial inequality in the southern US. Though many of the south's large utility companies have made progress towards energy transition, this has coincided a notable lack of investment in energy efficiency. In Alabama, Arkansas, Georgia, Mississippi and South Carolina, limited income communities use an average of 36% more electricity than in other locations. Thus, despite relatively low prices/kilowatt hour, the south east US is home to the highest energy burdens in the US, which disproportionately impacts limited-income communities of color.
In this article, the author notes that utilities are often hesitant to invest in technologies that will reduce electricity usage. This is most apparent in the south "where 19 utilities scored in the bottom half of ACEEE's [American Council for an Energy-Efficient Economy] efficiency scorecard." This lack of investment is often paralleled by limited-income residents, who are simply unable to overcome the initial costs of replacing an inefficient heater, AC, dishwasher, etc. However, the threat of climate change is motivating a change in the scene. Many utilities have sought to increase efficiency to help meet state mandates on carbon emissions reduction. Utilities are also coming up with new, creative solutions to help limited-income residents finance efficiency expenditures. Georgia Power's Pay As You Save program (PAYS) is perhaps the most interesting model. PAYS is basically a the same model that utilities use to finance a new powerplant, only in this case it is used to finance their customers' energy efficient homes and appliances: "A utility invests capital in customers' homes to make it more energy efficient and then recoups those costs on a monthly bill." Thus, this model effectively nullifies the upfront cost barrier to investing in energey efficiency while also providing incentives to low-income residents and renters by decreasing their monthly energy bills. "A $200-a-month utility bill might drop to $150 or $160 while the electric company is recovering its investment at the same time..." Georgia is aslo inspiring other utilities to experiment with similar models. North Carolina's utility giant, Duke Energy Corp., has recently aggreed to work along side the North Carolina Housing Coalition and North Carolina Justice Center to come up with a tarrif-on-bill model of their own.
That being said, Georgia has also recently suspended its moratorium on disconnections, leaving many limited-income communities of color facing insurmountable energy debts and impending shut offs. In return, energy and climate justice organizations have called out the utility (who has superficially supported the Black Lives Matter movement) for failing to put their money where their mouth is. Activists assert that the utility needs to go well beyond the PAYS program, "donating thousands of dollars toward weatherization programs for low-income homes and apartments; a workforce program to give people jobs; and making solar available to those who really need to lower their monthly bills."