As economy dims, utility shut-offs are soaring

updated 4:22 p.m. ET Oct. 6, 2008

COHOES, N.Y. - The number of Americans whose electricity or gas has been shut off for nonpayment of their bills is up sharply in many parts of the country as people struggle to cope with higher prices and a shaky economy.

Shut-offs have been running 17 percent higher than last year among customers of New York state's major utilities, and 22 percent higher in economically hard-hit Michigan. They are up in of dozens of other states, including Pennsylvania, Florida and California, according to an Associated Press check of regulators and energy companies.

Despite stepped-up efforts by state and federal governments, utilities and private groups to help people avoid shut-offs this winter, some worry the problem will only get worse in the coming months, particularly with the downturn on Wall Street.

"I just didn't have the money to pay," said Marie Williams, a single mother raising four daughters in Cohoes, N.Y., a former mill city on the Hudson River. "Rent had to be paid, and food for the girls."

Williams' power was cut off this summer for about a week, forcing her girls to do homework by candlelight. She became one of more than 230,000 residential customers of New York's 10 major utilities to have their service shut off for nonpayment through August of this year.

At the same time, people who rely on heating oil instead of gas or electricity to warm their homes are pleading for relief from high fuel prices.

Southern California Edison Co., with 4.5 million residential electric customers, reported residential terminations were up 10 percent through August of this year to 228,000; Westar Energy Inc. of Topeka, Kan., said it saw a 19.5 percent increase in residential shut-offs over the same period. Tampa Electric Co. reported a 19 percent climb in disconnect orders through June for residential and commercial customers.

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Michigan regulators reported a 7 percent increase in residential natural gas shut-offs through June and a 39 percent rise in residential electricity terminations.

Shut-offs often are brief and the numbers can include customers whose service was shut off more than once.

"Because of high gasoline prices, many families at the lower incomes have really been squeezed," said Mark Wolfe, executive director of the National Energy Assistance Directors' Association. "It's like triage: You pay the most important things, and the last thing you pay is your utility bill."

In Boston, Jaqueta Oliver works at a program for the mentally disabled but was not able to keep up with her gas bills after three months of unemployment last year. She said her bill snowballed to $1,271 before the gas was shut off in late September. Heating was not yet a problem, but cooking for her two boys, ages 5 and 8, was.

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