by Jon Sanders
Research Editor and Senior Fellow, Regulatory Studies, John Locke Foundation
As discussed here frequently, most recently in my Spotlight report on “Natural Gas: Low-cost energy source that curbs emissions and land impacts“:
Electricity is not a luxury item, however. It is a basic human need.
Electricity provision in North Carolina is from a monopoly provider. There is no choice in provider. A household is dictated its electricity provider. There is no choice in rates or source of electricity.
Those things — (1) basic human need, (2) no consumer choice allowed, (3) serious budget impact on poor households — show how important consumer costs are. It is critical to keep consumer costs as low as possible. State officials from the Utilities Commission to the General Assembly to the Governor must always bear that responsibility in mind.
Below is a graph showing just how expensive energy costs in general, and electricity costs in particular, are for people in North Carolina, especially the poor.
In 2015, electricity costs to the poorest North Carolina households (those earning less than $30,000 per year) averaged 9 percent of their after-tax income. Add in gasoline costs and home-heating costs, and energy costs consumer nearly a quarter of their after-tax income.