They could just require a cash deposit and pause service when you run up a bill exceeding that amt, but to the best of my knowledge they don't offer this option or if they do they don't promote it.

It's just pre-paid or credit-based contracts AIUI.

My power company asked for my SSN when setting up the utilities, after plainly refusing to provide it they said a $250 deposit would be required, done!

But why do they store it?

Post-paid plans are a small rotating line of credit - just like a credit card.

If you don't pay your bill or pay off your phone you get reported to the credit bureaus and sent to collections.

Postpaid plans are a rotating line of credit- you are credited the upcoming charges and pay off previous charges.