Analysts warn of more increases ahead
Electricity prices in the United States have climbed sharply in recent years, and analysts say additional increases may be on the horizon. An April 1 report from Lawrence Berkeley National Laboratory and The Brattle Group found that record requests by investor-owned utilities, combined with a high approval rate from regulators, point to continued upward pressure on customer bills.
Utilities proposed roughly $18 billion in rate increases last year. From 2021 through 2025, about two-thirds of those requests were approved. According to the analysis, revenue increase filings in 2025 surpassed any level seen since the mid-1980s, suggesting that regulators are now weighing a historically high volume of proposals.
Two perspectives on rising prices
The report outlines what it calls both a “crisis” view and a “more nuanced” view of recent electricity price trends.
Under the crisis framing, national electricity prices rose 33% between 2019 and 2025. Some of the steepest increases occurred in California, the Northeast and parts of the Mid-Atlantic. The analysis also notes that roughly one-third of U.S. households now spend more than 5% of their income on electricity, highlighting concerns about energy affordability.
The more nuanced perspective emphasizes that, in many cases, price increases have tracked overall inflation. Adjusted for inflation, 29 states actually experienced declines in electricity prices over the same period. In many regions, household energy burdens remain below 2019 levels when measured against income growth.
Residential customers see steeper hikes
While all customer classes have faced higher costs, residential users have absorbed the largest percentage increases.
From 2019 to 2025, the nominal price per kilowatt-hour rose:
- 33% for residential customers
- 26% for commercial customers
- 27% for industrial customers
Average residential electricity prices climbed from 13 cents per kWh in 2019 to 17.3 cents per kWh in 2025. Commercial rates increased from 10.7 cents to 13.4 cents, while industrial prices moved from 6.8 cents to 8.6 cents.
Across all sectors, retail electricity prices rose 5.3% in 2025 compared with 2024.
Drivers behind the increases
The analysis points to several factors contributing to higher rates. These include rising fuel and wholesale supply costs, investments in new generation resources, transmission upgrades, distribution system expenses, storm recovery spending and higher capacity market prices.
Severe weather events in recent years have also driven infrastructure repair and resilience costs. As regulators review ongoing rate cases, the report suggests that absent policy or market interventions, additional price adjustments may follow in the near term.
