Memphis Has One Of The Highest Utility Cutoff Rates In The Nation – But It Doesn’t Have To

This story was produced by MLK50: Justice Through Journalism as part of Next City’s Local Reporting Hub, with funding from the Kresge Foundation. Check out MLK50’s full series on utility cutoffs in Memphis.

Nearly one in five Memphis households experienced at least one utility cutoff for nonpayment in 2025, according to data obtained by MLK50: Justice Through Journalism through a public records request. Memphis Light, Gas and Water is a nationwide leader in utility cutoffs, with household disconnections rising by nearly 40% over the last decade.

According to MLGW, 75,378 households in Memphis experienced at least one utility disconnection for nonpayment last year. As of December 31, the company served 379,420 households. That’s a household cutoff rate of 19.9%.

“That is not a normal number,” says Jonathan Kim, a researcher with the nonprofit Energy and Policy Institute, which monitors the business decisions of fossil fuel and utility companies nationwide. “That is a lot.”

Utility cutoffs have well-documented health and safety impacts on low-income families, including increased risks of hunger from cutting back on food to pay bills, heatstroke from lack of air conditioning and house fires from the candles, cookstoves and extension cords families rely on to meet their basic needs.

But experts say it doesn’t have to be this way. Municipalities across the U.S. have adopted a variety of tactics to help residents avoid utility cutoffs while also benefitting utility providers. They include reducing fines and fees, offering payment plans with extended deadlines, creating discount programs for marginalized groups and even calculating utility bills as a portion of household income.

“They’ve decided that disconnection is no longer an appropriate tool to try and coerce low-income families to cough up money,” Kim says. “There are proven ways to recoup customer (debts) that don’t involve disconnection.”

In an emailed response to questions, MLGW spokesperson Stacey Greenberg called disconnection “a last resort,” adding, “we work with our customers when they struggle to make utility payments.” Read MLK50’s examination of MLGW’s cutoff policies and assistance programs.

Last year wasn’t an anomaly: A first-of-its-kind report from the U.S. Energy Information Administration released in April also identifies Memphis as a nationwide leader in utility cutoffs.

“Of municipal utilities, Memphis had the most disconnections of any in the country in 2024,” Kim says of the report’s findings. That’s not including cities served by privately-owned utility companies, but Kim’s organization has found that public utilities like MLGW cut off customers at a higher rate than those for-profit giants.

Since leaving her job in Memphis’ nonprofit sector last year, Nancy Brownlee has been using her extensive network to crowdfund for friends and strangers alike through Facebook. She says the most common struggle Memphians message her about is utility debt.

“One (woman) that I’m actively trying to raise money for, she’s 79 years old. There are six people who live in her house, and three of them are children,” she told MLK50: Justice through Journalism in late July. The family was facing a cutoff from MLGW and had nearly $570 in utility debt when they reached out to her for help.

After a series of posts to bring in donations, Brownlee was able to get the family’s balance below its cutoff threshold. But she says it’s a challenge to raise funds when so many Memphians are struggling financially.

“I have to tell myself not to get discouraged about it, because people just don’t have the extra (money to donate),” she says. Over a dozen families have reached out to her for help with their utilities. She estimates that their combined debt totals around $4,000.

Reducing rates and fees could increase repayment

There is currently no way to bypass MLGW’s fees or access lower prices for utility services. But these tactics have reduced utility cutoff rates elsewhere in the U.S., and can even increase customers’ rate of bill payment.

MLGW’s current fees include $30 for returned checks, $58 to reconnect services after a cutoff, and a 5% late fee on bills not paid within 12 business days. Kim explains that eliminating some of these fees could actually enable MLGW to recoup more money.

“You want to make these payments reasonable so that low-income families are able to meet them without having to scale back spending on food and medicine and other necessities,” he says. “Eliminating junk fees is counterintuitive because you’re asking (customers) for less money, but that can be a method to lower the hurdle and get folks to pay into their uncollected debts.”

Research shows that creating discounted rate programs can have a similar effect. MLGW recently released a study stating that its rates for utility service are the lowest in Tennessee. But selectively lowering rates for vulnerable groups, like seniors and low-income families, can both reduce cutoffs and help prevent everyone else’s bills from going up.

“The ultimate goal of utilities… is to avoid bills becoming uncollectible,” Kim says. “If (utility companies) are not able to collect money from certain subsects of their ratepayers, then the money’s got to come from somewhere, and that’s a burden that lands on other customers.”

Discounted rate programs for those least able to pay have already been adopted in at least 10 states, including New York, Indiana, and California. The nonprofit clean energy think tank RMI has found that these programs benefit all customers, not just those struggling to pay their bills.

“Evidence from multiple state programs shows that when (utility) commissions adopt affordability policies, they support vulnerable customers, reduce system-wide debt, improve payment behavior, and lower collection costs,” RMI researchers Carina Rosenbach and Joe Daniel wrote in an October 2025 analysis.

Assistance over punishment

The most effective approaches to reducing utility cutoffs typically involve working with customers who are struggling to pay their bills, instead of punishing them for their failure to do so. In one of the nation’s largest cities, this has meant ending disconnections for vulnerable customers, even if they fall behind on payments.

The Los Angeles Department of Water and Power adopted a motion in 2022 that ended utility cutoffs for customers enrolled in its low-income and senior discount programs. Since then, disconnections have plummeted: In 2025, the utility performed just 4,133 water disconnections in the entire city, where it provides water to over 740,000 households.

There’s currently no indication that MLGW plans to adjust its cutoff policies anytime soon.

Without significant policy change in sight, Brownlee is taking matters into her own hands. She’s currently raising funds for a new project called the Dream at Home Foundation, which would provide direct cash assistance to help families pay their bills.

“It’s like, ‘I put it in God’s hands,’” Brownlee says. “Memphis is a praying city. (But) sometimes you can’t put it in God’s hands. You’ve got to act.”