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2020 and the Utility Debt Crisis

June, 2020

As a result of the worldwide pandemic, by the summer of 2020, more than 30 million families across America were unable to pay their utility bills. Since then, the number has grown nearly exponentially each week. Some reports indicate that over 40% of US households are still not able to pay their rent and more than 40 million people lost their source of income as a result of the pandemic and applied for unemployment.

Americans are no strangers to debt. An article from the Washington Post points out that, “Even before the outbreak, 59 percent of credit card holders were carrying a balance, according to a recent survey by Of those who didn’t pay off their credit card debt every month, 25 percent had been falling behind for at least three years. Another 15 percent had carried debt for more than five years.”

But, let’s talk about utility debt. Over the course of the months in the first half of 2020, there have been nationwide calls to end all shut-offs through the shelter-in-place orders with hopes of federal stimulus funding helping families in need.

While, in large part, decisions are being made day-by-day at the state and local level, this could be a turning point for many communities in the ways that they approach and handle utility debt.

During this season of re-opening, many utilities are reporting up to 40% of their customers with negative balances. Under normal conditions, this would result in mass shut-offs, but is that the right things to do now—given that we are not in normal circumstances.

It’s a complex and unprecedented situation. So, the question remains: What is the right thing to do?

When life returns to normal again, how will things have changed? And, what changes could be made that would provide a win-win for customers and their utilities.

As a Strengths-based organization, we are always asking ourselves in every situation. How can we all come out better on the other side of this?