Retail Electric Rate Increases Outpace Inflation with Prices Set to Rise Higher

A new Lawrence Berkeley National Laboratory report found that U.S. electric rates increased 2.6% from 2024 to 2025 after adjusting for inflation, while nominal residential electricity rates have risen 33% since 2019, outpacing overall inflation. Utilities requested $18 billion in rate increases during 2025, and regulators approved 64% of the dollar value of revenue increase requests over the past five years, signaling that additional price increases are likely. Much of the upward pressure is tied to investments in transmission and distribution infrastructure, wildfire mitigation, fuel costs and grid modernization.

Rising electricity costs are becoming a larger household and business expense, creating opportunities for utilities, energy efficiency providers, HVAC companies, solar installers, home improvement retailers, appliance dealers and financial institutions to help consumers reduce energy usage, improve efficiency and better manage monthly expenses.