According to the U.S. Energy Information Administration (EIA), the average American home’s electric bill rose 4.3% (13.72 cents per kilowatt-hour) in 2021, year over year from 2020. It seems, though, that we haven’t seen the end of rising electricity prices.
Numerous states have warned that electric bills will increase significantly beginning on June 1. Many Americans will pay more for electricity this summer when inflation is nearing its highest level in decades.
Depending on where you live, your electricity bills could rise by up to 45%.
Pennsylvania, New Hampshire, Connecticut, South Carolina, and Massachusetts are among the many states anticipated to experience rate increases ranging from 6% to 45% because of rising natural gas prices and global events.
The New York Public Service Commission says that overall, residential energy rates (already higher than most states) are expected to increase by 11% to 12%, and by to 15% in some locales, compared to previous years. Customers are encouraged to manage their costs by conserving energy whenever possible.
Are Bad Actors a Contributing Factor to Rising Rates?
Meanwhile, in Illinois, these increases in costs have been tainted by suspicion since ComEd admitted in 2020 that it had used bribery for almost a decade to get laws passed that were suitable for its bottom line. When ComEd wants to charge more for delivering electricity, regulators have little recourse because the law uses a performance-based formula rate tariff.
ComEd asked for a $199 million rate hike in April. CEO Gil Quiniones says the money is needed to improve the grid and move to clean energy.
Unfortunately, consumer advocates have their hands tied. Because of the formula rate tariff, they can do nothing to stop the rate increase. The situation is bad news for ComEd customers, who are already paying more for energy because of the Russian invasion of Ukraine.
Prepare for Blackouts in Addition to Higher Energy Bills
Rate increases aren’t the only concern for energy consumers.
Climate change is leading to unusually extreme heat and a greater likelihood of blackouts. This summer, service interruptions are anticipated in California. When hot weather increases the demand for air conditioning, electricity transmission to customers’ homes and businesses can put a heavy strain on electrical equipment.
Adding to the problem, coal, natural gas, and aging nuclear reactors are being phased out, putting added pressure on power grids — essentially, traditional power plants are retiring faster than renewable energy and battery storage can replace them.
Wind and solar farms, which are among the cheapest ways to generate electricity, can’t always produce so they need large batteries to store their output when they’re in production.
Grid operators in the region are concerned that large-scale battery storage may not be fast enough to compensate for the closure of traditional 24/7 power plants. According to the state’s grid operator, the California ISO, the electricity demand is expected to outpace supply in California.
Texas, meanwhile, is also expected to experience a difficult summer. This week it was hot for spring, which caused a lot of people to use more electricity than usual. The Electric Reliability Council of Texas successfully kept the system from going dark. However, the high demand is concerning because it’s early May, which isn’t usually a scorching time in Texas.
Electricity Relies Heavily on Natural Gas Production — and Prices Are Rising
Nearly 40% of U.S. energy providers utilize natural gas for power turbines. Unfortunately, with Russia’s invasion of Ukraine, energy companies have been forced to raise prices.
As European countries rely less on Russian natural gas exports, they rely more on the U.S., which contributes to price hikes by American producers.
Who’s to Blame for Our Power Struggles and What Can You Do?
According to experts, both high prices and possible blackouts can be traced back to the inability of governments, utilities, and grid operators to manage the risks associated with climate change, global disruptions, and the shift to renewable energy sources.
The good news is that you can do your part. Conserve energy by putting sustainable lifestyle practices into place, opting to purchase and use Energy Star appliances, and choosing a power provider that offers green energy plans.
Opinion writer: Lynette Garet
The opinions, beliefs, and viewpoints expressed by the various authors do not necessarily reflect the opinions, beliefs, or viewpoints of Interactive Energy Group, LLC (IEG) or its parent companies or affiliates and may have been created by a third party contracted by IEG. Any content provided by the bloggers or authors are of their opinion and are not intended to malign any individual, organization, company, group, or anyone or anything.
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