Written by Jason Thomas | Last updated August 9, 2022
As we all know, the cost of electricity can fluctuate dramatically depending on where you live.
But what’s the average price per kilowatt hour across the country? New England states saw an average increase of nearly 11%, while those in the West North Central states saw a jump of just 1.73%.
So, where does your state rank? Keep reading to find out!
- Between 2021 and 2022, some states saw a huge jump in average electricity rates, including Maine, Hawaii, New Hampshire, Florida, and Connecticut.
- Other states saw mild increases, like Michigan, South Dakota, Alaska, and Idaho.
- There were even some states that decreased their rates, though not many – these states include Ohio, Virginia, Wyoming, and several others.
Average Electricity Rate by State
|May 2022||May 2021||Difference||Difference %|
|12||East North Central||15.43||14.72||0.71||4.82%|
|18||West North Central||13.03||12.60||0.43||3.41%|
|28||District of Columbia||14.76||13.40||1.36||10.15%|
|36||East South Central||13.03||12.31||0.72||5.85%|
|41||West South Central||12.86||11.75||1.11||9.45%|
Average Electricity Rate by Census Division
|April 2022||April 2021||Difference||Difference %|
|EAST NORTH CENTRAL||15.01||14.55||0.46||3.16%|
|WEST NORTH CENTRAL||12.36||12.15||0.21||1.73%|
|District of Columbia||13.68||13.35||0.33||2.47%|
|EAST SOUTH CENTRAL||12.87||12.35||0.52||4.21%|
|WEST SOUTH CENTRAL||12.76||11.67||1.09||9.34%|
10 States With the Biggest Increases in Rates
Vault Electricity compiled data reflecting the average electricity rate by state, comparing information from April 2021 to that in April 2022. Below are the findings.
What’s behind the increase? Mostly supply and demand. Business and leisure travel has resumed, and manufacturing has returned, so demand is up. But supplies have remained constrained due to several factors (including the war in Ukraine and supply chain issues caused and exacerbated by the COVID-19 pandemic).
|State Average electricity Price Increase 2021 – 2022|
|New Hampshire||17% increase|
|New York||14 % increase|
Why are these states higher than others? Electricity prices vary depending on the availability of fuels and power plants, as well as pricing regulations and local fuel costs. States with more renewable energy systems in place tend to see lower electricity costs overall compared to those without many.
10 States With the Lowest Increases in Rates
While many states saw a huge jump in electricity rates, others saw only mild increases. Here’s what the research shows.
|State Average Electricity Price Increase|
|South Dakota||0.59% increase|
|District of Columbia||2.47% increase|
|New Jersey||2.96% increase|
States With a Decrease in Rates
While there aren’t many states that actually saw lower rates in 2022, there are a few worth noting.
1. Ohio – 0.08% decrease
Ohio’s electricity rates are lower than the national average, but as the price of natural gas increases this summer and fall, they’re expected to shoot back up.
2. Virginia – 0.23% decrease
Virginia is beginning to adopt more renewable energy sources for electricity, helping to drive costs of electricity a bit lower.
3. Wyoming – 0.45% decrease
Wyoming’s electricity rates dropped in 2022 as a result of the Tax Cuts and Jobs Act, which lowered corporate tax rates for utility companies.
4. Montana – 0.72% decrease
Montana gets most of its power from hydropower which is produced by the federal Bonneville Power Administration. It has some of the largest shares of electricity generated from renewables in the country.
5. Oregon – 0.97% decrease
As Oregon shifts away from coal, electricity rates are going down, but prices are expected to rise in the second half of 2022.
6. Iowa – 2.11% decrease
Wind energy is a big factor keeping electric costs low in Iowa.
7. North Dakota – 2.96% decrease
With more than 30 electric companies in North Dakota, there’s a lot of competition driving the prices of electricity down here, but again, prices are expected to rise in the second half of 2022.
8. Nebraska – 4.39% decrease
Nebraska is the only state that generates electricity entirely by publicly-owned power systems, hence the lower rates. Electricity just costs less to produce here!
9. Rhode Island – 13.93% decrease
Although Rhode Islanders can take heart from the all-time low energy prices so far this year, don’t get too comfortable; National Grid expects prices to skyrocket this fall due to inflation and other factors.
What to Expect from Rates Moving Forward
U.S. electricity customers are facing some of the largest bills in years because of volatile natural-gas prices, which are being driven higher by winter demand and a global supply shortage being made worse by Russia’s war against Ukraine. Already, the natural-gas supply crunch has made it substantially more expensive for utilities to purchase or produce electricity.
Some electricity providers have stopped taking on new customers entirely, while others have started playing around with the idea of actually paying customers to bring their business elsewhere.
We’re all feeling the effects of climate change, from more extreme weather to higher electricity prices. And it’s only going to get worse in the coming years.
The Energy Information Agency predicts that electricity prices will continue to rise in the short-term and long-term as the demand for power increases. This means that we’ll all have to start paying more attention to our energy usage and find ways to conserve power.
One way to do this is to invest in energy-efficient appliances and light bulbs. Another is to make sure your home is well insulated and to consider outfitting your home with energy-saving devices or even switching to alternative energy sources (such as solar power). Many states, like New York, now have buy-in programs that make this a relatively seamless and inexpensive switch.
By making a few simple changes, we can all help to reduce our electricity bills and do our part to slow down climate change.
Methodology for Identifying the Average Price of Electricity to Residential Customers by State
To find the average electricity price, and then maintain the list over time, Vault Electricity’s editors regularly analyze U.S. Energy Information Administration electricity data to determine the latest prices by state. We monitor the eia.gov website weekly for this purpose.
In addition to identifying the average electricity rates overall, Vault Electricity’s editors help Texans get the most up-to-date and cheapest electricity rates in Texas. We also highlight all electric companies in Texas.
About the author: Jason Thomas is a native Texan, and Co-Founder and Partner at Vault Energy Solutions, a Texas electricity brokerage firm. Vault Energy Solutions was founded in 2009 with a mission to help homeowners and businesses find the best deal on electricity. Read more | Email Jason
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