The average retail price of electricity for households has risen steadily in the United States, reaching a peak of around 13.72 cents per kilowatt hour in 2021. In the United States, electricity prices tend to reflect base overnight costs for power plants, their maintenance, fuel costs, and the operation of power grids.
How electricity rates differ across states
The price of electricity varies widely across states. Hawaii has continuously had one of the highest rates and Washington one of the lowest. In Hawaii, the power sector is largely reliant on petroleum and diesel generators. Crude oil is a comparatively expensive fuel and prices tend to be volatile, driving up overall electricity prices. Meanwhile, there is virtually no fuel used in the generation of hydropower, and the cost of dams is spread over several decades. This keeps electricity prices low in states which use hydropower as the main source of electricity, as is true for Washington. In the U.S., costs of electricity are greatly shaped by the primary power source used per state.
Maintaining the power grid
In addition to primary fuel purchases, the costs required to operate and maintain transmission and distribution systems also impact the prices that a household pays. In 2020, power utilities reported a peak in grid operating expenses, with transmission-related costs reaching 12.9 billion U.S. dollars and 5.5 billion U.S. dollars invested in distribution networks.
Average retail price of electricity to the residential sector in the United States in selected years from 1975 to 2021
(in U.S. cents per kilowatt hour)
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EIA. (March 29, 2022). Average retail price of electricity to the residential sector in the United States in selected years from 1975 to 2021 (in U.S. cents per kilowatt hour) [Graph]. In Statista. Retrieved June 27, 2022, from https://www.statista.com/statistics/200199/residential-sector-electricity-prices-in-the-us-since-1975/
EIA. "Average retail price of electricity to the residential sector in the United States in selected years from 1975 to 2021 (in U.S. cents per kilowatt hour)." Chart. March 29, 2022. Statista. Accessed June 27, 2022. https://www.statista.com/statistics/200199/residential-sector-electricity-prices-in-the-us-since-1975/
EIA. (2022). Average retail price of electricity to the residential sector in the United States in selected years from 1975 to 2021 (in U.S. cents per kilowatt hour). Statista. Statista Inc.. Accessed: June 27, 2022. https://www.statista.com/statistics/200199/residential-sector-electricity-prices-in-the-us-since-1975/
EIA. "Average Retail Price of Electricity to The Residential Sector in The United States in Selected Years from 1975 to 2021 (in U.S. Cents per Kilowatt Hour)." Statista, Statista Inc., 29 Mar 2022, https://www.statista.com/statistics/200199/residential-sector-electricity-prices-in-the-us-since-1975/
EIA, Average retail price of electricity to the residential sector in the United States in selected years from 1975 to 2021 (in U.S. cents per kilowatt hour) Statista, https://www.statista.com/statistics/200199/residential-sector-electricity-prices-in-the-us-since-1975/ (last visited June 27, 2022)