Since 2001, the average cost of electricity per kilowatt has nearly doubled for residential customers, according to the U.S. According to 2024 research, low-income households in the U.S. spend about 17% of their income on utilities, about three times the national average. The uptick in costs around 2021 primarily comes from power production, seemingly from the costs https://www.ourbow.com/geezers-visit-spaces-art-technology-showcase/ of natural gas generation in particular. From 2020 to 2022, a stark increase in the costs of power production aligned with a period of high global natural gas prices during the first years of the Russia-Ukraine war. However, the longer-term trend is a reduction in the costs of power production, as real natural gas prices generally have been decreasing since the boom in hydraulic fracturing methods to extract natural gas around 2010 and as new renewable generation has reduced fuel expenses.
For example, to mitigate grid costs, policymakers can reduce obstacles to building new energy infrastructure, reform markets and procurement practices to attract an efficient portfolio of resources, and support demand-side alternatives like subsidies for rooftop solar and energy efficiency. Governor Kathy Hochul today announced that the New York State Public Service Commission (PSC) approved the implementation of the Energy Affordability Guarantee pilot program. The PSC’s decision provides a plan for the design and implementation of an energy affordability pilot program for low-income households who fully electrify their space and water heating through the EmPower+ program.
Africa’s Energy PPPs Succeed When Planning, Policy, and Public Interest Are Prioritized
Electricity affordability has become a key issue, particularly as data centers drive electricity demand projections higher. From 2019 to 2025, the nominal price of a kilowatt-hour rose 33% for residential customers, according to recent analysis by Lawrence Berkeley National Laboratory and The Brattle Group. A recent PowerLines poll found 73% of Americans are concerned that their bills will rise again next year. First, sealed settlements and opaque rate discounts to large industrial customers limit oversight and may shift costs to low-income customers without accountability. Participants emphasized that many rate-case settlements and special-contract negotiations are filed under seal, preventing outside advocates and even some commission staff from understanding what was agreed to and/or how it affects low-income customers. This concern was echoed in relation to commercial and industrial rate proceedings where discounted rates are often granted without transparency.
One Industry Working Together
Nationally, average real electricity prices have risen in the past four years, after nearly two decades of flat or decreasing real prices. However, this increase is driven by certain regions of the country; many other regions have experienced stable electricity prices. A monthly update for state, local, and K-12 stakeholders featuring resources to advance successful, high-impact, and long-lasting energy efficiency and renewable energy partnerships, programs, and projects. The report notes despite the political rhetoric, clean energy stocks have outperformed traditional energy by over 45% since early 2025, driven largely by macroeconomic and interest rate trends rather than by partisan politics. Energy affordability is already a strained issue, and should federal disinterest in alternative modes of energy continue, the report warns, it’ll be an even larger issue in future. As of late 2025, the United States was home to 5,427 AI-related facilities and counting, or roughly 45% of the world’s data centers.
How can utilities transform data center backlash into a catalyst for grid modernization?
Though batteries can help accelerate the retirement of natural gas plants by providing firm energy to supplement renewables’ generation, politicians’ fear of load growth seems to have forged a bipartisan consensus supporting batteries. For its part, Form Energy is focused on continuing to drive down the cost of its iron-air battery. Nate Benforado, a senior attorney with the Southern Environmental Law Center, said in an interview that increases in demand from factors like data center expansion and electrification have changed the calculus for energy policy in the state. The preliminary analysis presented in the Report indicates between 12.1 million and 19.2 million households throughout the U.S. lack affordable access to water services. The estimated national cost of unaffordable water service bills ranges from $5.1 billion to $8.8 billion per year. These cost increases reflect the higher costs of building new infrastructure for transmission and distribution or maintaining existing infrastructure.
We do know that storms are getting more frequent and stronger, and we’re seeing impacts in places that we usually didn’t see impacts,” Sideris said, citing repeated weather-related outage problems in the western Carolinas, typically more immune from weather events than Florida and the coastal regions. After all, out of the $1.4 trillion in nationwide utility capital spending, the bulk of spending is in the South—from Texas to Maryland—where $572 billion in spending is planned. And, yes, the plans involve keeping some of the dirtier coal-fired plants on life support beyond the previous goal of phasing out coal by 2035.
This pilot program will provide approximately 1,000 EmPower+ program participants with tailored bill assistance to ensure they pay no more than six percent of their annual household income toward electricity costs. To be eligible for the guarantee, the customer’s home must meet the income eligibility standard for low-income programs, which is set at annual household income equal to or lower than 60 percent of the State Median Income; and the customer must also be electrified through the EmPower+ program. The EmPower+ program, administered by the New York State Energy Research and Development Authority, provides no-cost and subsidized energy efficiency and clean energy upgrades for low-to-moderate income households. Despite these gains, they noted that most of the state’s energy affordability initiatives still focus on relief at the household level. The participant observed that tools such as heads up displays and home energy reports assume a level of control that many energy insecure families do not have, making it unlikely that they alone can resolve the structural cost challenges embedded in the ratemaking process. Utilities can expand their customer engagement programs to proactively enroll and sustain eligible households in energy assistance programs.
Energy Affordability Program Fact Sheet 2026
“It’s hard to see utility bills coming down in this decade,” said Rob Gramlich, president of Grid Strategies, a power sector consulting firm. PJM’s process for bringing new electric supply online has “crashed and burned,” Silverman said. Tax subsidies under the Inflation Reduction Act led to a surge of renewable energy projects waiting for grid connection. PJM is struggling to keep up with approvals, which can take five years in some cases, he said. It holds auctions to secure electric capacity from power plants to ensure the grid remains reliable.
- The future of power involves electrifying the heating of buildings and operation of vehicles, but realizing this future requires electricity prices to be low enough that millions of households can choose to purchase electric technologies over the existing fossil fuel alternatives.
- If you live in the Seattle Public Utilities service territory and do not have an SPU bill in your name, you may still be eligible for utility credits.
- An independent watchdog that monitors those PJM auctions found that data center demand, actual and forecast, made up $9.3 billion, or 63% of the total power capacity bill for 2025 to 2026.
- This report explores how residents of North Lawndale, a predominantly Black and historically under-resourced neighborhood on Chicago’s West Side, experience the compounded effects of heat waves and power outages.
- By intervening at fundamental decision points, high bills can be prevented before they reach households, in contrast to the prevailing practice of addressing affordability in a more reactive manner.
Intervenors who question the disparities in rates and rate discounts between commercial and industrial customers on the one side and residential customers on the other are frequently told that this is how things have always been done. One participant noted that overcoming this mindset will require sustained dialogue and ultimately a shift in institutional culture. The EOL framework presented at the roundtable identified ongoing and proposed interventions at each stage of the ratemaking lifecycle, beginning with the core stage of setting the revenue requirement. Participants observed that while PBR has potential to incorporate affordability at the revenue requirement stage, its effectiveness depends on thoughtful design, incentives, and broader structural reforms.
Additional Challenges Limiting Integration of Affordability into Ratemaking
These data document how US electricity prices have changed from 2001 to 2024, how resulting costs have changed, and the various components of costs. Collectively, analyzing these data help us explore some of the underlying causes of changes in electricity prices. Unlike intermittent renewables, nuclear energy provides a reliable, carbon-free baseload power, an attractive option to meet AI’s high energy demands. So far, the Trump administration has issued an executive order that would fast-track construction of nuclear reactors to a strict 18-month deadline. Among the key economic issues Republicans are looking to address is the Trump administration’s rollback of federal funding for clean energy. Calling solar and wind power “the scam of the century,” Trump and Republicans reversed clean energy programs originally established by Democrats in 2022, and have canceled federal grants for clean energy projects.
Five leading water associations urge Congress to create a low-income water assistance program
- Bruce Blakeman, the Republican candidate for New York State Governor, spoke Saturday at Centerway Square in Corning, taking aim at utility costs and other affordability concerns for New Yorkers ahead of November’s general election.
- However, this recent increase comes on the heels of 15 years of electricity prices that grew more slowly than inflation, on average.
- “Thirty-one states and the District of Columbia saw an increase in retail sales volume in February 2026 compared to last February.
- “In the wake of the filing … and reflecting upon concerns expressed by customers, policymakers, regional leaders, and community partners, PECO has determined to seek leave to withdraw its proposal and maintain electric distribution rates at current levels,” the Philadelphia-based company told the PUC.
As part of the discussion, the EOL team presented a draft framework for integrating affordability considerations into the early stages of the utility ratemaking lifecycle. Participants provided feedback on the framework and discussed practical strategies for advancing upstream affordability interventions as well as the barriers to and opportunities for putting these ideas into practice. In the Northeast, Massachusetts, New Hampshire, New York and Connecticut each have a straight discount rate codified by law or Commission order.
The energy industry takes justifiable pride in meeting expectations every time someone flips a light switch. However, it’s essential to remind customers and regulators of the efforts and costs that are required to meet those expectations. Doing so will highlight how affordability is a shared concern that can empower stakeholders on every side to play an active role in the future of the entire energy sector. The Energy Opportunity Lab (EOL) at the Center on Global Energy Policy (CGEP) at Columbia University SIPA convened a private roundtable on May 20, 2025, focused on utility ratemaking and electricity affordability in the United States. The event brought together leading experts and representatives from utilities, Public Utility Commissions (PUCs), local governments, consumer advocacy organizations, community-based organizations, and academic institutions from seven US states.
