The Summer of Shutoffs
By isaac sevier and Winston Yau
We are in the middle of an energy crisis unlike anything the U.S. has seen since 1973, when fuel shortages sent heating oil, gasoline, and electricity prices soaring almost overnight. This crisis has been spreading, and is pushing millions of Americans into debt to afford access to the essential energy services needed to survive the extreme weather of storms, heatwaves, and winter freezes. Every state in the country is facing the intense political pressure of an unsustainable utility affordability crisis.
The right is playing politics with our energy system, and consumers are suffering as a result. One of the few forms of government energy assistance, the Low Income Housing Energy Assistance Program (LIHEAP), has been victim to DOGE efforts to cut public programs, putting people even more at risk of utility shutoffs as we look toward another summer of record-high temperatures (in 2023, LIHEAP diverted nearly 6 million households from being shutoff). By any means necessary, the right is determined to conflate energy affordability with the expansion of fossil fuels and rejection of clean energy.
As progressives oriented towards climate and economic justice, we need to organize for a solution that addresses this swiftly and head on by presenting an alternative which delivers lower costs and cleaner energy. That means being clear on who builds, owns, and operates our energy system—and who stands to benefit. We need public sector capacity for public good in our utility system.
The good news is there is already a model that we can galvanize around: nearly every state in the country has the lowest cost utility model—a 0% profit margin—called ‘public power’. Public power is a term used for electric utilities that are controlled by local governments, not Wall Street investors, owned by the community, and operated with a non-profit model. Twenty-five million Americans already have the lowest electricity bills in the nation thanks to public power, paying 13% less than other utility customers. And we think it’s time this model spreads to address the combined energy, affordability, and shutoffs crisis.
False choices: investments vs. affordability
The debate around utilities is often framed as a binary choice: either we invest in our grid or we lower bills. This is because in our existing system, the cost of new investments and maintenance costs are passed straight through to consumers with as much as a 10% profit margin. States like New Jersey, Rhode Island, New York, and California, have bills this session to set a fixed cap on this guaranteed profit margin.
In the legal and regulatory structure of for-profit, privately owned utilities, the only way to lower bills is to cut corners or to avoid investment altogether. But we need investment to guard against wildfires and heatwaves—whose frequency and severity is intensified by climate change. New research in states like Massachusetts, California, and Ohio is showing that the for-profit owners have chosen for decades to pocket those profits, while skipping on investments in the grid that would prevent frequent outages.
Not only does this produce dissatisfaction with the grid we have, this irresponsible choice to redistribute wealth upwards instead of invest in our grid blocks the ability to add the solar, renewables, and electric vehicles we need to the grid. Instead of our energy infrastructure being an essential, universal service, for-profit utilities make electricity into a commodity that contributes to the largely dwindling wealth of most Americans, while the share of wealth held by the few grows exponentially. Easing permitting for energy infrastructure will not advance affordability or decarbonization if the underlying wealth redistribution model of private ownership for public services remains intact.
Within publicly and privately owned utility systems alike, raising bills to raise new capital is deeply unpopular. For-profit utilities dominate ownership, and their self-rewarding models cause these failures in the first place. During the peak of the COVID pandemic, utility corporations sent their CEOs home with tens of millions of dollars of compensation, while cutting off lights and power for millions. This evidence underscores what many Americans understand intuitively: that “investor-owned utilities” are always expanding wealth inequality by taking money out of everyday households and sending it to Wall Street. One financial estimate sizes this transfer to be around $1 trillion in the coming years alone, making it clearer why most people might hold a negative opinion of existing utilities.
In the summer of shutoffs, choosing not to cover the cost of unpaid electricity bills will mean up to 52 million Americans will be shut off before the end of the year. This figure does not include children, and it is based on the last count of Americans unable to pay at least one energy bill in 12 months. It also does not include people who are likely to lose their jobs in 2025 due to the Republican-backed tariffs and economic sabotage. As progressives, the choice is easy: in a green, fair economy, people should not be sacrificed for the sake of corporate shareholders and profits.
A patchwork of policy measures are in place to create checks and balances with the private utility companies, but only 21 states have enacted a ban on utility shutoffs in heatwaves, which cause thousands of deaths. In the early stages of COVID, some states issued blanket bans on disconnections for the duration of the state of emergency. To prevent mass death during the summer of shutoffs, every state should bring back these measures to provide electricity as a public good. This departure, albeit temporary, from failed energy policy norms is essential for saving lives amidst an unprecedented economic disaster, in which many predict most of the social safety net will be shredded and abandoned. Acting swiftly to provide electricity for all could transform a moment of calamity into a moment of positive orientation towards a progressive state which responds to the needs of the people during an economic crisis. Research on this phenomenon suggests that failures of governments to act in these times of crisis further decreases social faith in government. Now is the moment to win back that trust.
The right’s answer marries ‘energy dominance’—expansion of the fossil fuel industry—with energy affordability
Relief from high energy bills is supposedly the duty of public utility commissions whose voting members are tasked with acting in the public interest. But during the height of the pandemic, the utility commissioners' lobby bragged about blocking life-saving advocacy to stop utility shutoffs with an act of Congress. The majority of utility commissioners in the nation are appointed by a governor rather than democratically elected, and a majority of states have Republican majorities in their utility commissions, obscured by ‘nonpartisan’ labels on their appointments. Utility commissions have a history of approving new profits far and above what’s necessary, rewarding utility corporations regardless of their actions or compliance with important climate, pollution, or health and safety laws. As a whole, utility commissioners today should be understood as unresponsive to democratic control.
As of April, the Trump administration has taken aim at states’ abilities to regulate issues in the energy sector altogether. In one executive order that oversteps executive authority, the Trump administration goes so far as to attempt to sunset most of the regulatory infrastructure for gas and electric utilities alike. At the same time, the first Secretarial Order from the Department of Energy marries energy dominance with energy affordability. Where Republicans hold unchallenged political power, like in Louisiana, they are acting to expand their undemocratic control over whatever will remain of state-level decision making.
At the same time, utility corporations are forming alliances with big tech and bipartisan politicians to build data centers that could spread the costs to residential electricity users. Rate cases being contended right now showcase further potential scale of harms that include keeping expensive coal and gas plants open, and harming residents with air and noise pollution. In the South, similar to what’s happening to the national parks, there are active, well-funded efforts by capital, neoliberals, and conservatives alike to sell off the few remaining public assets in the electricity system and privatize them.
The left’s answer must advance climate, affordability, and managed decline together
Public power can begin to build us out of this deep contradiction between the well-being of Americans, reflected in our grid’s quality and interconnectivity, and the deregulated system which has failed all of us. Public power prioritizes democratic planning under a publicly owned institution. “Service at cost” was one of the original slogans for the North American public power movement in the early 1900s, and it remains true today. Within single entities that are able to competently build, own, operate and coordinate clean generation, transmission and distribution across regions, public power can eliminate the coordination problems we’ve seen in Texas, the most deregulated electricity grid in the United States, in winter blackouts.
Public power can also protect electricity users over dramatic price fluctuations in a marketized pricing system, and prevent exacerbating energy burden during extreme weather events that are only becoming more frequent. Without being held hostage to private demand for excessively high rates, the build out of publicly owned clean electricity would realize renewable energy’ full cost-saving potential. As expert Sandeep Vaheesan explains, public power can “competitively pressure private utilities to do better on rates, reliability, and decarbonization.” Integrated grid planning and delivery would produce more efficient and thus cheaper systems designs, like in California where it is estimated that public ownership of transmission alone can produce billions in savings.
In a structurally unequal society dominated by corporations, only the state can deliver on this type of social abundance and fill this functional gap in operating revenues. This summer, locally-owned and democratically-controlled public power utilities are going to be faced with similar stresses to their for-profit counterparts, but their outcomes won’t be as severe because of electricity prices alone.
Public power brings costs down for consumers. In 42 states, public power has the lowest average bill or the lowest average electricity rate compared to all other forms of electric utility provider. Their structure allows them to keep every dollar of revenue reinvested in the system and in the local community, instead of sending trillions out of the community to Wall Street.
Activists and city government leaders across the country are already trying to democratize, decarbonize, and decommodify our energy systems as soon as possible. In New York for instance, the Build Public Renewables Act (BPRA) expanded the New York Power Authority’s remit to build, own and operate up to 15GW of renewables. Similarly in Maine, there are proposals to enact new affordability protections and advance towards universal electricity service, made possible in part because of the statewide push for public power in 2023. In Mid Hudson Valley, legislators were elected specifically to transform the utility into public power by a powerful coalition of grassroots, public power activists. Together, they are now advancing a state bill to municipalize their unpopular utility, Central Hudson Gas and Electric. Tucson is not far behind, Another group of progressive state legislators in Rhode Island are advancing a suite of bills to increase public ownership and limit corporate returns. California is attempting similar transformation to competently build, own, operate and coordinate clean generation, transmission and distribution.
Moving economic justice and public planning forward at a time of right-wing and oligarchic attacks on the state’s ability to deliver essential services is undoubtedly challenging, but we have been here before. After the devastating economic crash of the Great Depression, the New Deal brought the electric utilities under greater regulation, but stopped short of making public power the law of the land. That error led us here today, and we should use that historical knowledge to plan better. By addressing utility shutoffs this summer, we can secure a near-term win and begin to ensure public infrastructure is run for the purpose of serving the multi-racial working class, not just for the oligarchs.