When I first started getting into the utility business I remember that I was on an airplane traveling to a client in another city when I started talking with a woman yesterday who had a young son. She asked what I did for a living and I said that I worked with utilities. Her son piped up “Are you the man who turns off the power?” and that killed the conversation (mom was embarrassed and I learned to be careful about too much information).
One of the different elements about utilities is that they serve all customers. Since utilities are a “natural monopoly” (meaning that it doesn’t make sense to have two companies stringing up electric poles side by side) the flip side of giving them monopoly rights is that they must provide for all the customers in their “service territory”. While most of the readers of this blog probably never interact with the utility company unless they move or have an outage, utilities spend a significant amount of time and money on collections and turn-on, turn-off activities for poorer customers. Each of these events is preceded by multiple calls, collection attempts, and then physical visits, none of which make money for the utility.
While a lot of this made sense when utilities were regulated monopolies, now many regions have significantly “de-regulated”, which mainly means that the generators of power are free to charge what they want and the local utility makes its money by passing on power costs and charging more for their profits. In the case of Illinois, where Exelon provides (most of) the power and then their fully-owned subsidiary Commonwealth Edison provides power to residents (and complains about the high cost of power that it passes on), no one is shedding tears for Exelon. However, in other areas where the generation and distribution companies are actually separate, you need to start thinking harder about the cost of poorer residents in your service territory.
This article describes the (sad) case of a disabled resident in Bronzeville (a less affluent area in Chicago) who is complaining to the Chicago Tribune that the local gas utility won’t turn on the fuel in an article titled “Gas Shut-off Leaves Disabled Man in the Cold“. In the article, the man hasn’t paid his bill, so the utility comes and turns off his service in April, and the man is angry and complains to the newspaper.