When a Study Singled Out Memphis’s Unfairly High Power Bills, Grassroots Groups Took Action

The electric bill that arrives in homes around Memphis, Tennessee, every month is unlike any other in the nation. Residents here bear the country’s highest energy burden―the percentage of income spent on electricity. In fact, Memphis families spend twice as much as the average American household just to keep the lights, air-conditioning, and refrigerator running.

“In Memphis, we’ve seen as much as 26 percent of people’s income going to energy bills, which is outrageous,” says Sandra Upchurch, energy organizer for the Southern Alliance for Clean Energy (SACE). The national average is closer to 3.5 percent, and 7 percent is the norm for low-income households. “When your income is low, even an average electricity bill can be a big burden.”

The high cost of utilities didn’t happen overnight in this city known as the center of blues music. A tangled web of poverty, poor investment in energy efficiency, and a history of disenfranchisement of the city’s communities of color has produced a wide range of negative economic, health, and environmental impacts. That’s why a number of nonprofit groups—including the Memphis branch of the National Association for the Advancement of Colored People (NAACP), Sierra Club, SACE, and Friends of the Earth—are working to improve life in Memphis, starting where it’s needed most: at home.

In 2016, the American Council for an Energy-Efficient Economy and Energy Efficiency for All (of which NRDC is a core partner) published a report that brought the concept of energy burden into the public eye. It ranked cities by energy costs relative to income and revealed that low-income residents of color spent a monthly average of $1.23 per square foot of home size, while those in higher income brackets paid $0.98 per square foot. Despite having low electricity prices in general, Memphis topped the list in the study, with several other cities in the Southeast close behind.

Here’s why: Without the resources to maintain or improve their homes, low-income residents often can’t afford cost-saving upgrades like closing drafty cracks, adding insulation, and installing newer, more energy-efficient appliances. As a result, their inefficient, leaky homes become even more expensive to power. It’s part of the cycle of poverty that relegates low-income people of color to areas of their city where energy costs, ironically, are sometimes higher than in newer, better-maintained neighborhoods.

One way to close the divide, says Amelia Shenstone, SACE’s regional advocacy director, is for utilities to improve existing programs that help with weatherization and other efficiency measures and to increase access to renewable energy options for low-income clients. In addition to improving the energy performance of individual homes, these programs contribute to better air quality for the entire community.

But here’s the rub: Memphis is supposed to have these programs already. A few years back, the Tennessee Valley Authority (TVA), the federally owned utility that supplies Memphis’s municipal power company, offered a one-time funding opportunity called the Extreme Energy Makeover Program. The program provided funds for home weatherization and energy efficiency improvements. 

But out of more than $40 million allotted to cities, Memphis, TVA’s largest customer, received zero dollars. “We see the lack of investment in energy efficiency as targeted against our people,” says SACE’s Upchurch. “We are their largest customer, bringing in $1.5 billion a year, yet it’s as if they take us for granted because we are a minority-majority city. They want to keep the cycle of poverty going.”

Eventually, under pressure from SACE and NAACP, TVA did give Memphis Light, Gas and Water (MLGW) $1 million in low-income home weatherization grants through another program. “TVA has a long history of working closely with MLGW and the city of Memphis to address the needs of residential customers and, in particular, fixed- and lower-income residents,” says TVA spokesperson Jim Hopson. “This collaboration has been quite active in recent years with nearly $8 million in direct support from 2008 to the present, touching over 14,000 Memphis families.”

MLGW’s own Share the Pennies program rounds up residential customers’ utility bills to the next dollar and uses the extra funds collected to support low-income families. But at the current funding levels, it would reportedly take a century for the program to help all residents in need, according to SACE.

Other examples of energy advocacy in the city include SACE’s Memphis Has the Power campaign, a petition drive that urges TVA to focus on energy efficiency and renewable energy, and the Strong, Prosperous, and Resilient Communities Challenge, led by NRDC and three national partners investing $20 million in grants in six localities over three years to fund equitable community development.

Despite its history of inequality, Memphis is actually well positioned to be a leader in the Southeast when it comes to lowering the energy burden of its citizens. The power company is municipally owned rather than privately held, which means taxpayers can demand a say in how the company is managed. Ultimately, that’s good for the utility itself, its customers, and the community as a whole, says Katie Southworth, a consultant for NRDC’s Southeast Energy team, who calls it “the democratization of public power.”

The goal, she says, is for utilities to realize that weatherization and energy efficiency programs for those with low incomes are a win-win. Such programs strengthen the utility, put more money in the pockets of its customers, and benefit the environment. And they level the playing field for all. “Tackling energy burden is a step in the right direction toward a more just energy economy in the Southeast,” says Southworth.