Utility bill debt, service shut-offs set to rise as US energy costs soar

Sixteen percent of US households are behind on their electricity bills, and that number is expected to rise this winter season as temperatures drop and energy costs rise, the National Energy Assistance Directors Association warned.

At the same time, more residential customers will find themselves without service, Mark Wolfe, NEADA's executive director, told a Dec. 11 press briefing.

"Because of high prices, we expect the number of families shut off from power to increase from about 3.5 million to 4 million," Wolfe said. "On many levels, electricity is becoming unaffordable. We don't have plans in place to help these families adapt."

Rising energy prices are in focus nationwide as electric utilities and regulators grapple with rate increases aimed at covering the cost of additional grid infrastructure while maintaining affordability for consumers.

The average residential electricity price rose 32% from July 2021 to July 2025, outpacing inflation, new data from S&P Global Energy shows.

In the 12 months that ended July 2025, the average real residential electric rate increased across 37 states and the District of Columbia as double-digit rate increases took hold in many areas. The District of Columbia experienced the largest year-over-year increase in nominal terms, up nearly 34%, according to the analysis.

Those increases add to the debt burden millions of Americans already carry and come as federal energy bill savings programs expire.

The budget legislation that President Donald Trump signed into law in July will phase out the Energy Efficient Home Improvement and Residential Clean Energy tax credits by the end of 2025. Congress had expanded the tax credits under the 2022 Inflation Reduction Act.

Ratepayers unable to pay their power and natural gas bills today owe their utilities a total of $23 billion, according to NEADA's most recent estimates. Many of the same ratepayers face temporary disconnections because of delinquent bills.

In October, for example, Consolidated Edison Co. of New York, which serves customers in New York City and neighboring Westchester County, New York, temporarily cut service for 27,881 households — up from 6,780 a year earlier, NEADA's data showed. Nearly all got their power back within a week, and many within 24 hours, Allan Drury, a Con Edison spokesperson, said in an email. Most were then placed on payment plans, he said.

"Termination of service is a last resort, and we do so only after extensive outreach and exhausting all other options to help customers become current on their payments," Drury wrote. "It is essential that our customers pay their bills to maintain safe service and industry-leading reliability."

Con Edison is "acutely aware" of the affordability challenges customers face and offers various assistance and forgiveness programs as well as special protections for vulnerable populations during cold weather months, Drury added. Over the past two years, the company offered $500 million in bill discounts to eligible customers.

Rising energy costs concern states

The pressure from rising power prices is coinciding with a growing overall debt burden, Mike Pierce, executive director of the nonprofit Protect Borrowers, told the Dec. 11 press briefing. US households now owe more than $18.5 trillion in car loans, credit card balances, student loan debt, and more, he said.

All but eight states prohibit electric, and in some cases natural gas, utilities from disconnecting service when the weather gets cold. Such policies vary significantly, however, and do not always provide adequate protection for financially stressed households.

Senator Sheldon Whitehouse, a Rhode Island Democrat, noted the US Congress has limited say over retail energy prices that state regulators set.

"Like with a lot of these issues, there's a big local component," Whitehouse told reporters, adding that data center developers, who have been cited as a primary reason for increasing demand for electricity and subsequent rate hikes, have faced little pushback from states thus far.

That may be changing.

In Indiana, NiSource recently created a new subsidiary that will focus on meeting energy demand from new hyperscale data centers while insulating other ratepayers from the costs. In other states, such as Kansas, regulators are creating special tariffs to ensure that data centers absorb most of the costs associated with new infrastructure needed to support such projects over several years.

For now, retail power bills have yet to reflect infrastructure and transmission investments associated with data center operations, researchers with S&P Global reported.

"To date, there is no distinct correlation between data center development and electricity rate increases at the state level," they wrote, adding that this "could change as forecast data center demand over the next five years significantly outpaces growth observed since 2020."

There are also less visible, region-wide costs associated with the data center expansion, including high-voltage transmission investments, which eventually show up in rates. Such grid costs, which the Federal Energy Regulatory Commission oversees, reached $4.3 billion in the PJM Interconnection region alone in 2024, according to a study published in September by the Union of Concerned Scientists.