Kilito Chan | Moment | Getty Images
Electricity prices are soaring for U.S. households despite an overall cooling in inflation. This alarming trend demonstrates the pervasive effects of government overreach and the complacency that allows it to fester.
Data from May 2025 reveals electricity prices rose 4.5% in just one year, nearly double the inflation rate across all goods and services, which should concern every American who values their hard-earned income. The U.S. Energy Information Administration predicts that retail electricity prices will continue to outpace inflation through 2026, a clear signal that we need to scrutinize the policies behind these rising costs.
“It’s a pretty simple story: It’s a story of supply and demand,” states David Hill, executive vice president of energy at the Bipartisan Policy Center and former general counsel at the U.S. Energy Department. However, what this narrative overlooks is the weight of an overreaching government pushing policy agendas that stifle free-market competition.
Electricity demand growth is being hampered by the deactivation of power-generating facilities while the installation of new sources lags behind, as highlighted by Hill. This is not merely a matter of supply and demand; it is a symptom of a marketplace hindered by bureaucratic red tape and costly regulations.
Prices are regional
In 2023, U.S. consumers spent an average of about $1,760 on electricity. Yet this figure masks significant regional disparities that only exacerbate the burden on families. Those in areas like Pacific, Middle Atlantic, and New England already pay exorbitant rates relative to the national average. It is a reflection of how corporate elites manipulate localized markets while the average American suffers.
According to the EIA, the household electricity price averaged about 17 cents per kilowatt-hour in March 2025, but this varied dramatically—from a low of about 11 cents in North Dakota to around 41 cents in Hawaii. Such fluctuations reveal the disparity in how our nation ensures access to essential services. Those in economically stressed areas face rising bills while doing little to benefit from the supposed efficiencies of a more centralized electricity grid.
Households in vulnerable regions are set to see their electric bills rise faster than others, a critical issue that demands attention. In the Pacific region, residential prices may increase by a staggering 26% from 2022 through 2025. Meanwhile, the West North Central region will not fare much better, with an increase of about 8%. It is a dire situation that highlights the urgent need for policy reform to promote competition and accountability.
“Electricity prices are regionally determined, not globally determined like oil prices,” notes Joe Seydl, a senior markets economist at J.P. Morgan Private Bank. This disparity in authority and oversight should spur us to demand a reevaluation of our energy policies.
The EIA’s forecast of a 13% increase in average retail electricity prices from 2022 to 2025 means an average household’s annual bill could jump by about $219, raising it to approximately $1,902. The message is clear: if this trend continues, our personal responsibilities will be burdened by corporate and governmental mismanagement.
Many households in the Pacific area can expect even more severe price hikes, which underline the consequences of centralized energy policies over local control. We risk repeating the mistakes of the past if we fail to advocate for an energy market driven by competition and customer choice.
Data centers are ‘energy hungry’
The QTS data center complex under development in Fayetteville, Georgia, on Oct. 17, 2024.
Elijah Nouvelage | Bloomberg | Getty Images
Data centers represent a major factor in growing electricity demands. As technology becomes increasingly ingrained in our lives, the burden falls disproportionately on traditional energy systems, which were never intended to handle this surge. Jennifer Curran, senior vice president at Midcontinent Independent System Operator, pointed out that electricity demand growth was “minimal” over recent decades largely due to the rise of efficient technologies. But this newfound appetite for electricity, especially from data centers, is overwhelming the grid.
Data centers, vast warehouses of servers powering everything from cloud computing to artificial intelligence, are consuming resources at an alarming rate. According to the U.S. Energy Department, electricity use by these centers tripled to 176 Terawatt-hours in the past decade. Projections suggest this figure may double or even triple by 2028, representing a significant increase that raises questions about our energy sustainability.
The stakes are high; data centers are expected to consume up to 12% of total U.S. electricity by 2028, signaling a need for stronger policies that embrace traditional values of hard work and responsibility, rather than allowing the state to dictate energy management. The government should be encouraging innovation, not stifling it.
The anticipated surge in electricity demand from continued electrification of homes and businesses should push for immediate reform. While the U.S. powers forward with the electrification agenda to reduce greenhouse gas emissions, it inadvertently increases demand on an already burdened grid. Electric vehicles and alternative heating methods may be more efficient, but by neglecting our infrastructure needs, we compromise our energy future.
Additionally, population growth and high-energy activities like cryptocurrency mining further contribute to the demand crisis. It’s a clear message: a free-market approach, combined with responsible governance, is crucial to safeguard both our economy and basic living standards.
‘All about infrastructure’
Thianchai Sitthikongsak | Moment | Getty Images
As we grapple with rising electricity demand, it becomes transparent that our infrastructure is outdated. Seydl from J.P. Morgan emphasizes that escalating electricity prices are fundamentally linked to infrastructure issues. The grid is aging, and our transmission systems are falling behind.
Michael Cembalest, chairman of market and investment strategy for J.P. Morgan Asset & Wealth Management, highlights the stagnation in transmission line growth, which is far below the targets established by the Energy Department for 2030 and 2035. Furthermore, the shortage of transformers, essential for our electrical grid, presents another obstacle. Delivery times have stretched to two or three years, while a mere four to six weeks was the case only a few years prior.
It is estimated that half of all U.S. transformers are nearing the end of their service lives, necessitating swift action. Cembalest notes that the inflation rate for transformers and other transmission equipment is among the highest of all wholesale goods since 2018, again underlining the mismanagement stemming from bureaucratic neglect.
Compounding these challenges, the decommissioning of old fossil-fuel plants has not been matched by a timely replacement of capacity. With rising costs in labor and materials, building new facilities has become a burden that impacts all consumers. It is time for a renewed commitment to traditional values of hard work, personal accountability, and economic responsibility.
