This post was written and contributed by Jacquie Moss, TEPRI Research Fellow. See original post here.
Unemployment associated with the COVID-19 pandemic will likely create a concerning new wave of energy insecurity among Texans. According to the Texas Workforce Commission (TWC), unemployment insurance (UI) claims have exceeded 900,000 in the four-week period from March 15 to April 11, 2020. For perspective, there were just over 52,000 claims in the same period last year.
This 17x jump in claims does not even accurately account for the number of Texans who have lost their livelihood. The number of people filing UI claims has overwhelmed TWC’s systems, meaning that some people who are attempting to file claims have not been counted.
Energy Burden Pre and Post Pandemic
Representing 41% of Texas households (pre-pandemic), low-income energy consumers spend a disproportionate amount of household income on energy. This concept of the percentage of household income spent on energy is often referred to as “energy burden.” In Texas, the average energy burden for low-income households is 9% compared to 2% for non low-income households. These figures are determined using data from the Department of Energy’s Low-Income Energy Affordability Data (LEAD) Tool (2019). We define low-income households as those earning 0-80% of area median income.
Before this pandemic, we (TEPRI) found that a large percentage of low-income households across the state experienced difficulty paying their electric bills (30-55% of low-income households depending on the region). Additionally, we found that households make difficult trade-offs to afford their electricity bills, with 29% of survey respondents saying that they delay or skip spending on food. These findings are included in the infographic shown below (Figure 2).
While there were notable regional differences as to what contributed to difficulty paying electricity bills, the factors that were most commonly shared statewide were these:
- difficulty with other bills
- stress and sickness related to one’s home temperature
- presence of children in the home
- poor quality of housing
- household members with disabilities.
Many more households have members who are spending more time at home — either to care for children, because of losing a job, or because of working-from-home. These changes will show up in the household’s electricity usage, and likewise, in the difficulty and stress related to paying those bills.
The team at Pecan Street, Inc. recently reported on how COVID-19 is changing residential energy use. Pecan Street has monitored hundreds of homes in its research network for almost a decade. Closely analyzing appliance-level data, the team discovered that refrigerators and HVACs are seeing the biggest increases in usage since the onset of this crisis. Cooling demand increased by as much as 40% in March compared with average from the previous three years. Based on these findings, we want to closely watch what happens in the summer months as temperatures rise for economically-vulnerable customers who generally run less efficient refrigerators and heating/cooling systems.
Many Americans have no financial buffer. As reported by the Board of Governors of the Federal Reserve System, almost 40% of Americans do not have the resources to afford an unexpected $400 expense. With little cushion to absorb the economic shock of the COVID-19 crisis, many households are turning to food banks, community action agencies, and charitable organizations for help.
There are bill assistance resources in place for most electric customers across the state. We wrote previously about the federal CARES Act and PUC of Texas order on suspension of disconnections. These are important steps to address the economic impact for vulnerable households. However, in many cases, payments are deferred but not forgiven. This crisis is likely to leave many low-income households with a very deep economic burden that includes several months worth of energy bills, among other deferred bills, at some point in the future.
This problem presents an opportunity to plan now for long-term solutions to help reduce the economic burden of residential energy use. Solutions may include increased deployment of energy efficiency and other distributed energy resources (DERs), such as community solar and smart home technologies, as well as creating new pathways for participation in the advanced energy economy.
How Big Sun Community Solar Can Help
With the onset of summer and higher cooling costs, increased energy insecurity challenges are likely. Our research supports that solar provides long-term energy solutions and an opportunity for families to reduce their monthly electric bills.
Historically, low-income communities were left out of traditional rooftop solar programs because of the high upfront cost. We understand the challenges of making long-term financial decisions during the COVID-19 pandemic — especially for families struggling with food, energy, and housing costs.
Big Sun Community Solar collaborated with CPS Energy, TEPRI, and the Westside Development Company (WDC) to launch the Solar Assistance Program for families falling under the 80% Area Median Income threshold. Through generous contributions from three foundations (80/20, Microsoft, and San Antonio Area Foundation), Go Smart Solar provides $6,000 down payment assistance for eligible families joining the program. The down payment assistance allows families to recognize more savings every month and delivers the benefits of solar programs to families who were historically unable to participate.
The Big Sun community solar program allow households and businesses to invest in solar without the need for a viable rooftop because the solar system is located offsite and managed by the Go Smart Solar team. Eligible customers include homeowners, renters, businesses, and nonprofit organizations.
According to Go Smart Solar, approximately 250 San Antonio households have joined the Solar Assistance Program. With an average system size of fifteen (15) kilowatts offsetting 74 percent (74%) of their annual consumptions, Big Sun Community Solar members are, on average, saving $1,900 on their electricity bills per year.
For more information on the Big Sun Solar Assistance Program please visit: https://bigsun.cpsenergy.com/solarassistance/