"For nearly 16 million American families the struggle to heat their home this winter will hit the crisis point in early summer. According to a report on CNN's Lou Dobbs Report, 15.5 million people are at least 30 days behind on their heating bills. While company's are prohibited from shutting off energy in the winter
months, the advent of warm weather means many of those families will now have their utility shut off.
The problem is no longer seen just in low income families. With record energy prices, unemployment or underemployment, the problem is creeping into working and middle class families. These are people who have always paid their bills regularly and whose heating costs are just one of the soaring costs of living.
"Going into 2008, we had expected oil prices to start easing," says Tancred Lidderdale, analyst for the U.S. Energy Information Administration. But the close match between global oil supply and demand - the tight market - means geopolitical tensions and market worries can have a large impact on price, he says. "And all the tightness in the market is showing up in heating oil" when it is in peak demand, Lidderdale says.
The federal assistance program, LIHEAP, which provides funds to states to help families pay winter heating costs, has been serving a steadily increasing number of families since the program began in 1980. However Congressional appropriations for the program have not kept up with the increases in energy costs. The 5.8 million families who receive energy grants represent only 16 percent of the families eligible for the program. To try to stretch the limited funds,the amount of the grant awarded to each family has decreased, leaving even these families barely able to make it through the cold months. Many will not have enough money to avoid having their energy cut off this summer. In those cases, the cutoffs will affect cooking, air conditioning, and hot water.
Families who receive federal energy assistance account for only one-third of those facing shut offs. And a large number of families are exhausting their savings and credit lines to avoid shuts offs. A survey by CreditCards.com found that nearly 9 percent of Americans - an estimated 20 million consumers - use credit cards to pay heating bills this winter. However, unless they are able to keep up with the credit card debt, that solution may not be available next winter.
Check back for Part 2 for the continuation of Energy Crisis.
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