St. Stephen – This weekend I was asked to go meet a family in St. Stephen who have been told their power will be shut off if they can’t pay their overdue bill, which is nearly $2000. This family is on social assistance, and their power costs are subtracted from the check they receive each month before it is sent to them.
They rent a small two bedroom apartment in St. Stephen, and their monthly power costs range from $250 in the summer, to $750 in the winter. Being on a fixed income they have been unable to keep up with the payments on top of what is taken out of their social assistance.
NB Power now wants to raise their equalized payments to $550 a month (over half of their monthly income) until the debt owed to NB power is paid off, when the payments will then drop to $400 a month.
This is an all too common story in our part of the world, and one which is typically dealt with by an appeal to the MLA’s office, who then intervenes on behalf of the family with NB Power, and negotiates a deal which will stop them getting their power shut off.
There is a prescribed narrative that comes with poverty, and the story told changes depending on your perspective.
For those who use the term “welfare” as a political dog whistle, poverty is seen as a choice, and those who need help in our society are leeches who for one reason or another choose not to contribute to our collective well being.
For those who devote their time to help those in need – and aim to eradicate poverty – it is the result of a systemic imbalance that on the one hand recognizes that some people are and always will be in need of help, and on the other hand structures our society so that the poor exist always on the cusp of poverty.
For those who live in poverty, it is a slow death; a black cloud which hangs over reality, sucking the colour and joy out of the world and rendering it in flat grey tones. It affects all aspects of life, and forces a feedback loop of poor health, poor decisions, and poor social mobility. Poverty destroys confidence and self reliance. It is a trap, and as such, is very hard to escape.
Everything costs more when you are poor.
This isn’t just because of the relative value of a dollar, but also because of the need when you are poor to service immediate concerns. Middle and upper class households often buy things in bulk or when they are on sale. This requires mobility and enough income to make these kinds of purchases. Spending $80 on toilet paper when it‘s on sale makes sense when you can afford to, but when you have to make a choice based on limited income, the lower sticker price, but higher per item price, of six rolls becomes a reasonable choice. This is true of all household necessities.
It is also true of energy costs. Whether you rent or own a home, high energy usage in this part of the country is an inescapable reality. But if you have the means, it can be partially mitigated. Increasing the energy efficiency of a home and its appliances is often a capital intensive process, but it pays off with a lower energy bill which saves money over time, as well as increases the value of your primary asset – your home. This is not true when you are poor. You likely rent, and it’s likely in an old building with poor efficiency, causing your costs of heating to be higher than the average.
The heat in this family’s home is provided by baseboard heaters without a programmable thermostat. In essence, their heat is either on, or it’s off.
New Brunswick tries to offset the high heating costs faced by poor families by providing home energy assistance to qualifying low income households, but as rates increase and low income housing remains inefficient – it’s worth asking how it is that we’ve ended up in this state of affairs.
According to a former employee of NB Power, in the early 1970s when the utility was proposing that a nuclear power plant be built at Lepreau, the capacity a station of that size would generate was considered to be unnecessary. The solution was to incentivise customers to convert their heating to electric – including baseboards and forced air furnaces. This provided enough wintertime load to justify the construction of the Lepreau generating station, and the excess capacity was sold to New England in the summer.
Over the decades, the efficiency of electric forced air and baseboard heating has lagged even further behind the competition, and recognizing this, in 2005 the government established Efficiency NB as a crown corporation which provided grants for homeowners and businesses to incentivise them to replace their baseboard heaters with more efficient central heating systems.
In 2008, energy minister Jack Keir said, “Electric baseboard heating systems are the least efficient and least environmentally friendly heating option.”
But the days of heating costs being a pressing political issue did not last. In 2015 Efficiency NB was absorbed into NB Powers’ new energy efficiency unit, and those programs have been phased out, contrary to the claims of NB Power at the time.
In February of 2018, at a rate hearing in Saint John, Darren Murphy, NB Power’s chief financial officer and senior vice-president said, “Electric heat contributes really valuable revenue most of the months of the year. The notion of eliminating the electric heat altogether has the implications of reducing revenue all year long.”
According to the former NB Power employee, who did not want to be named, “In my opinion, the profitability of NB Power is not something the province has ever been forthcoming about.”
The question for Darren Murphy and the rest of the executive team should then be if baseboard and other electric heating is so profitable to NB Power, where is that profit coming from?
In short – it’s coming from us – the ratepayers. It’s also coming, in a disproportionate way, from the poor. How is it a publicly owned corporation is unwilling to promote energy efficiency in the market that they serve? Shouldn’t a public utility have the public interest, rather than profit, as its primary goal?
For the family in St. Stephen who is being threatened with having their power shut off, the politics of rate increases and energy efficiency doesn’t matter all that much.
“In November,” said the mother of the family, who also wished to remain anonymous, “I have to choose between my heating bill or paying my rent.”
“We’ve gone to the food bank weekly,” she added, “and if we didn’t have that – I don’t know where we would be. Sleeping in the car probably.”