Opinion: Turning Off the Lights


Jason Isaac and Anna Claire Long | Image by Jason Isaac and Anna Claire Long

West Virginian Michelle Beck wrote in a letter of protest due to the rate increase on electricity. “People are having to choose between feeding their family or paying an electric bill. Elderly are having to choose between buying food, electric, or medicine! I’m paying $300 still and haven’t turned the heat pump on. Someone needs to put a stop to these increases!”

The sinking economy, along with crippling electricity bills, is leaving many residents of Appalachia in financial insecurity and unsure of what the future holds.

The Biden administration has failed to uphold campaign promises to come to the aid of the working class in America. The president, who vowed to lessen financial burdens, has only contributed to their weight with inflation and the rising costs of energy pricing.

What has happened? How did energy prices get so high, and how are Americans coping?

The Global Energy Institute’s 2021 electricity price map registered a 5.6% increase in electricity prices in 2021, and the prices have only continued to climb since then. With inflation soaring higher and lasting longer than anticipated, economic growth is slowing down, leading to lower employment rates, supply chain shortages, and higher prices across the country.

As natural gas and coal prices have risen, electricity prices have kept pace, both rising to the highest levels the United States has seen since the 2008 recession. With electricity prices surging, Americans across the board are struggling to keep up with the bills; many must forgo other necessities to cover them.

In the past week, the average gas price has reached $5 per gallon. Coal prices in central Appalachia have risen 40% in 2022 to $129.65 per short ton. Natural gas prices futures for June settled at $8.30 per million British thermal units (MMBtu), up 123% for the year. Crude oil prices have risen more than 15% in 2022 alone.

How are they all connected? American oil and gas companies, due to increasing pressure from environmental activists that have infiltrated every level of government, major corporations, and financial institutions, are drilling fewer wells than they were before COVID-19. Supply is low, but demand is high and getting higher as people are eager to return to both travel and business. As a result of the higher cost of natural gas, electricity prices are significantly influenced because it is frequently the marginal fuel for generating units used to supply electricity.

A number of factors contribute to this, including infrastructure, production and distribution costs, and the global market which has run into supply chain disruptions and led to higher inflation.

With the growing fuel costs, wholesale electricity costs have also risen across the board. In turn, energy costs affect working class and rural Americans, like Michelle Beck, the most, knocking so many of these people off their feet. And 16% of adults report keeping their home at temperatures that feel unsafe or unhealthy due to the rising energy costs. One in six people have been unable to pay their energy bill in full in the past year. Americans are reeling from these energy prices that are affecting their everyday lives.

In order to increase oil supply and drive down energy pricing, the barriers to oil production should be reduced to access and produce new oil supply on federal lands and waters. The financial burden on refineries ought to be relieved and there needs to be improvement on the efficiency of distribution to decrease the cost of delivering crude oil to refineries. Also, strengthening partnerships with trading partners and allies, both foreign and domestic would increase energy production. These are all actions that could and should be taken to alleviate the energy crisis which is negatively impacting Americans every day.

Jason Isaac is Director of Life:Powered, a national initiative of the Texas Public Policy Foundation. Prior to joining Life:Powered, Jason, a fourth-generation native Texan, was elected four times as the State Representative for Hays and Blanco counties in the Texas Hill Country.

Anna Claire Long is the Energy Policy Intern at the Texas Public Policy Foundation in the Life:Powered initiative, working to increase awareness of American energy policy.      

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