Here at Virginia Poverty Law Center (“VPLC”), we know that electricity is too costly in Virginia. In discussions with our clients and struggling families across the state, we hear and see the impact of the energy burden on Virginia families. Next week, VPLC will release a study that provides visual representation of the high electricity burden that exists across the Commonwealth, independent of utility service territory. Our study finds that while the national average for electricity burden by household stands at 2.7% (that is the percentage of a household’s income spent on electricity costs), Virginia’s households experience on average a higher electricity burden at 3.1%. Further, the number of Virginia households with an electricity burden higher than the Commonwealth average far exceeds the number of households with electricity burdens at or below that average - over 75%, which means that far more Virginia households are overburdened by the high cost of electricity.
As studies have shown, energy efficiency is the least cost resource for low-income households to meet their energy needs, and can make a significant difference in reducing this disproportionate electricity burden for Virginia’s families whose income is at or below 200% of the federal poverty level. Energy efficiency is about using the energy consumed more efficiently and effectively to accomplish the task at hand. Low income families should not be sacrificing their health and safety to “conserve” energy. It isn’t as prudent to ask a cash-strapped mother of a sick child to reduce the thermostat in her home below 65 in the dead of the winter to help reduce her energy bill is not the answer. Nor asking a fixed income senior citizen to raise their air conditioner setting to 80 during the dog days of summer. Low income households already use less energy than their moderate to high income peers simply because on average they live in smaller homes. However, the energy burden low-income families carry is twice and sometimes three times that of families of greater economic means. Telling low-income families to “conserve” energy by raising or lowering their thermostat is not going to bridge that gap. Energy efficiency measures are a better and more effective way to help those struggling families around the commonwealth.
Additionally, Virginia’s policy makers and utilities talk about “electrification” of our society. This will equate to the usage of more electricity to do a greater number of tasks every day: Virginia’s lawmakers encourage citizens to use more “online services” available through our state agencies; schools introduce more technology into the classroom to help students learn and explore the world beyond the walls of their building; companies encourage workers to “telecommute.”, and even your own Energy Plan includes a section on the impact of the booming electric vehicle market. All of these shifts require a greater dependency on and usage of electricity in our daily lives. This trend will only increase the need for electricity and its usage - as well as overall energy, burden on low-income families in Virginia.
Investments in energy efficiency is where this burden can be mitigated for low income families.. While some behavior modifications can help – turning off the lights when not in a room, unplugging electronics when not in use, etc., these modifications will not lower the electricity burden of the families. The burden is not dependent on the amount of the electricity used, it is the total sum of the cost of that usage.
There are several factors that create this overburden, and it will take a comprehensive approach to address these factors in a strategic manner to be effective. VPLC therefore asks for your thoughtful consideration of the following as you create your Energy Plan:
Understand and recognize that solutions to resolving Virginia’s high electricity burden will require accurate and complete data. While we know from studies done across this nation and in other states that energy efficiency is truly the least cost resource for electricity generation, we are unable to access Virginia specific data to support this statement. The State Corporation Commissioners have indicated repeatedly that they need Virginia specific data to understand fully the impact of programs both to an individual and to the entire system. Currently, all the data is owned and held by the utility companies. These companies hide behind “trade secret” and “confidentiality” arguments that are far too broad and impertinent. Individual customers are the perpetrator of the data and it is the individual customer who rightly owns that data, not the utility. It should be a priority of this administration to ensure Virginia’s consumers have ownership and access to their utility usage data. Such access should be easy and the data should be in a format that is clear and useful to the consumer in order to enable them to make informed decisions about how and when they use their utility service. Additionally, such access should be easily transferable by the consumer should they wish to share this information. We ask the Governor to develop a system to ensure consumers have a right to their own energy usage data, while still allowing use of aggregate consumer data to improve further gains in energy efficiency in the Commonwealth.
The Governor as Virginia’s leader must share his vision of the Commonwealth’s energy future with the citizens. Yet there is a disconnect for the average citizen about the effect of an energy plan on their daily lives. Concepts such as “climate change,” “sea level rise,” “carbon trading/abatement,” “energy efficiency standards” are just phrases to the average citizen used to win or force the loss of an election or to prove a point. As stated earlier, electricity burden affects a significant number of Virginia households, and has a profound effect on low-income households. It should be a priority of this administration to develop an education program to illustrate for Virginia’s citizens how energy use affects their daily life. The program should provide tools and resources to empower Virginia’s citizens to become “energy smart,” and encourage their engagement in directing the decisions made about Virginia’s energy future. We would recommend that you direct a subcommittee of your Environmental Justice Council to work along with Department of Mines, Minerals and Energy (“DMME”) staff, as well as the State Corporation Commission’s (“SCC”) Virginia Energy Sense to develop a statewide campaign based on your Energy Plan to educate low-income consumers about smart and efficient energy usage, and provide information and options for assistance in managing their energy costs.
Energy efficiency is the least cost resource for low-income households to mitigate their high electricity burden. We ask that you engage fully in the energy efficiency stakeholder process as created in SB966 to ensure that this assumption directs the work of this group. As a fully engaged partner and stakeholder, your contributions to this process will ensure appropriate consideration will be given to the issues faced by low-income households in meeting their energy needs.
A priority should be given to mitigate the harm done to low-income families with high electricity burdens. We would suggest a program that would implement a “public benefit charge” on utility bills that would provide a direct reduction to the utility bills of qualifying low-income households. We would welcome the opportunity to discuss design of such a program that has worked in other states to directly mitigate the harm of rising utility costs on low-income families.
We recognize that our recommendations are not directly within the scope specifically set forth by Department Mines, Minerals and Energy officials at the start of the Energy Plan stakeholder process, but we acknowledge the technical expertise required to address the topics set forth is not within our scope of work as advocates for policy that affect low-income families. Instead, we hope our comments will provide some unique perspective that is often lost in the conversations of industry official and technical experts to address the undue burden experienced by Virginia’s most vulnerable and often absent from policy conversations that directly affect their daily lives.
Dana Wiggins, Director, VPLC Affordable Clean Energy Project
Carmen Bingham, Coordinator, VPLC Affordable Clean Energy Project