Electricity bills have become one of the fastest-rising household expenses in the U.S. as utility companies across the country requested a combined $31 billion in rate hikes in 2025, the largest amount ever recorded, according to Fortune. Just like with rising grocery prices, rising electricity prices are facing the same scrutiny.
What's happening?
Fortune reported that residential electricity prices rose 7% last year alone, while piped gas prices increased 11%, per data from the U.S. Department of Energy. Charles Hua, executive director of the nonprofit PowerLines, told Fortune that nearly half of the requested rate hikes are still pending and could hit customer bills this year.
"It's the new politics of electricity, where electricity is the new [price of] eggs," Hua told Fortune. "Electricity and gas are now the two fastest drivers of inflation. ... It's not just a little bit more; it's significantly more than what [people] are used to seeing. That is creating this sense of public and consumer frustration that we're seeing."
It's important to note that Hua also pointed out that the artificial intelligence and data center boom is not yet the main driver of recent increases, but it's on its way to becoming a major factor over the next five years if costs are continuously passed to households. Utility companies have pointed to aging infrastructure, damage from extreme weather events, and demand from data centers as factors in the rising costs.
Why are the rising utility costs concerning?
Rising utility costs directly affect everyday people, especially low- and middle-income households. Watchdogs, like Energy and Policy Institute executive director David Pomerantz, have accused some utility companies of designing systems that keep electricity bills high while protecting profits. It's been reported that customers are often forced to pay for infrastructure investments that primarily benefit corporate growth instead of affordability. Plus, ratepayers may be covering costs without clear transparency.
What's being done about the price hikes?
The Fortune report said political backlash is already happening with voters in Georgia removing incumbent public service commissioners after widespread anger over the costs. Wall Street analysts told Fortune that utility companies face reputational risk if they cannot prove rate hikes are justified. Some states, like Maine, have already rejected major rate hike proposals, according to Fortune. All in all, until incentives for utility companies change, Hua said, bills are likely to keep rising.
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