energy bill above? This is how electricity costs have developed over the past year

Electricity costs in the US are making their biggest jump since the last major economic downturn.

Despite the push to build more renewable energy sources over the last decade, fossil fuels still carry most of our electricity generation. All of the voltage required to power our lights and appliances every day has to come from somewhere — and 60% of that electricity in the US comes from plants that convert oil, coal and natural gas into electricity. While America has largely reduced its dependence on oil, natural gas and coal together account for all but 0.7% of all fossil-fuel power generation.

The global shortage of natural gas is driving prices to record levels. Of course, utilities pass this increase in costs on to their consumers — the average American owner or renter. The ongoing war in Ukraine has also resulted in a resource battle as Russia has cut off allied countries’ access to its oil and natural gas resources. The war reached a possible rupture when Russian President Vladimir Putin annexed four Ukrainian regions and made unsubtle hints of nuclear retaliation should NATO allies attempt to intervene.

Russia is the second largest natural gas producer in the world. Unlike the US, however, Russia’s largest oil and gas producers are state-controlled, meaning the industry can be manipulated and armed by their government. Over the past two decades, the US, particularly Texas, has tripled natural gas production through innovative new extraction techniques known as “fracking.”

Even with increased US natural gas production over the past 10 years, global shortages coupled with the Biden administration’s decision to export more fossil fuels is depressing markets and driving up prices.

A Bank of America data analysis released in September 2022 found that households earning less than $150,000 a year saw the largest increases in their electricity bills that year. While gas prices have risen, their rise hasn’t matched that of electricity costs, which also vary between states — each of which is home to an energy industry that uses different combinations of renewable energy sources and fossil fuels to power homes.

OhmConnect analyzed data from the Energy Information Administration to examine the rising cost of household electricity in the US and how it varies between states.

Line chart showing seasonal electricity costs in centers per kilowatt-hour, with July 2022 setting a new record


Electricity costs for private households set a new record in July 2022

The average monthly electricity costs reached 15 cents per kilowatt hour in June. The price declined for almost half of 2020 before beginning the uptrend into 2021 and 2022. In July, the average American electric bill reflected electricity costs that were more than 11% higher than the same month in 2021.

The last time US electricity prices rose that sharply was in 2009. Before that, the first nine months of 2006 saw double-digit increases in electricity prices as the energy crisis peaked in the 2000s, driven by the high demand and natural disasters like Hurricane Katrina that shut down 90% of US oil production for a time.

Map showing regional trends in electricity costs.  The Pacific Northwest has the lowest cost per kilowatt hour


Residents of New England and California have the highest electricity bills in the continental US

According to power grid operator ISO New England, the states of New England, including Maine, Connecticut and New Hampshire, are vulnerable to spikes in natural gas prices because state power grids rely on fossil fuels. The region uses natural gas for 53% of its electricity needs; the national average is 38%. Proposals to create around 30,000 MW of wind power generation capacity in the region would make wind power competitive within the power grid, which currently has a total generation capacity of just under 33,000 MW – but such measures have yet to be implemented.

Map showing regional trends in electricity cost change since July 2013


California and some New England states have also seen the largest cost increases since 2013

In California, Massachusetts, Maine, Rhode Island and Illinois, residential electricity prices have risen more than any other state over the past decade.

In recent years, as the population has grown and demand for power generation has increased, New York has resisted building new or expanded pipelines that could carry more natural gas from Pennsylvania and other states north. Opponents argue that more infrastructure creates greater dependence on fossil fuels. Oil and gas advocates have scoffed at the bans on pipeline expansion and other attempts to de-emphasize fossil fuels, saying it is a factor driving up consumer costs.

On the West Coast, California might as well be the poster child for modern-day energy fragility, as wildfires and heatwaves wreak havoc on its power grid year after year. The state continues to struggle with rising energy costs and is setting aggressive electrification targets to combat climate change. Funds for infrastructure upgrades, wildfire mitigation and energy efficiency programs are baked into the state’s electricity tariffs.

This story originally appeared on OhmConnect and was produced and distributed in partnership with Stacker Studio.