Energy policy should start with the people who pay the bills

For thousands of North Carolina families, the monthly electric bill is not just another expense. It is a difficult calculation. Paying to keep the lights on often means having less money for groceries, rent, medicine, or other necessities. Unlike many household expenses, electricity is not something families can simply do without.

A recent John Locke Foundation report introduces a county-by-county Energy Poverty Index for North Carolina. Rather than measuring electricity costs as a share of income in the aggregate, the index estimates how much electricity costs exceed what households below the poverty line can reasonably afford, adjusted for family size. This approach provides a clearer picture of the financial strain facing households in poverty because it measures the gap between energy costs and affordability rather than simply identifying who has high utility bills.

The difference is significant.

A county can have high average incomes while still placing a heavy burden on low-income residents. Orange County is one example. Despite the county’s overall wealth and excellent economic performance, poor households in Orange County face one of the largest energy affordability gaps in the state. Similar patterns appear in Durham, New Hanover, and a few other relatively prosperous counties.

Energy poverty is not limited to rural or urban communities. It exists wherever electricity costs outpace the ability of low-income households to pay. The report looks at customers of every type of electric provider and finds the problem is widespread. For customers of investor-owned utilities, such as Duke Energy Progress, the report finds that nearly half of North Carolina counties have energy poverty gaps reaching the most severe levels. For customers served by municipal utilities and electric cooperatives, the share of counties with the most severe energy poverty gaps is even higher.

That distinction matters. Municipal utilities and electric cooperatives often serve smaller customer bases and less densely populated areas where the costs of maintaining electric infrastructure are spread across fewer ratepayers. Investor-owned utilities, by contrast, generally benefit from larger service territories and greater economies of scale. While each utility model has its own advantages and faces different operational constraints, the findings illustrate that energy affordability is shaped by far more than local income levels alone. The cost of providing electricity, the characteristics of the service territory, and broader energy policies all influence how affordable power ultimately is for the households paying the bills.

These findings remind us that affordability cannot be assumed simply because an area is economically successful. Nor should policymakers rely solely on statewide averages when evaluating how energy costs affect North Carolinians.

Instead of asking whether electricity bills are high, the Energy Poverty Index asks a more meaningful question: high for whom?

That question deserves to be at the center of energy policy discussions. Debates about electricity often focus on generation technologies, emissions targets, infrastructure investments, or long-term planning. Those are important conversations, but they do not change how energy policy is experienced by households. For most families, energy policy is reflected in the amount due figure in the monthly electric bill.

For households living in poverty, affordability determines whether there is enough money left over after paying for electricity to cover other necessary expenses. Rising energy costs do not occur in isolation. They ripple throughout the household budget.

North Carolina law recognizes that electricity should be reliable, adequate, and provided at the lowest achievable cost. Affordability is not a secondary consideration. It is a fundamental part of the public interest. Yet affordability is often discussed only after broader policy decisions have already been made.

No single metric should determine North Carolina’s energy future. But any serious conversation about that future should begin with a clear understanding of who bears the costs. The households most affected by rising electricity prices are often those with the fewest options to absorb them. If energy policy is ultimately meant to serve the public, then its success should be judged not only by power generated, but also by whether that power is affordable for all North Carolinians..

“Energy policy should start with the people who pay the bills” was originally published on www.carolinajournal.com.