Briefing at a Glance

  • Lawrence Berkeley National Laboratory (LBNL) released this montha 2026 update report, based on its peer-reviewed journal article published last year on retail electricity price trends and drivers. The data show that, after adjusting for inflation, U.S. retail electricity prices rose 2.6% from 2024 to 2025.
  • Since 2019, nominal residential electricity prices have risen 33%, commercial prices 26%, and industrial prices 27%, with LBNL noting the gap between residential and commercial and industrial (C&I) prices continuing to widen. However, the report also shows that while residential electricity price increases have outpaced overall inflation, they remain below the increase in residential natural gas prices. The report was prepared by The Brattle Group.
  • LBNL states that the inflation-adjusted national average retail electricity price is currently 3% higher than in 2019, but 6% lower than in 2010, and that electricity bills as a share of income are near historic lows. However, the national average masks significant regional differences.

In-Depth Analysis

The report finds that utility rate increase requests reached $18 billion in 2025, a multi-decade high. Between 2021 and 2025, state regulators approved 64% of the revenue increase requests filed by electric companies, which LBNL says "portends further electricity price increases in the near term absent policy or market interventions."

LBNL data show that over the past seven years, California and several states in the Northeast and Mid-Atlantic regions have seen the largest retail electricity price increases. After adjusting for inflation, from 2019 to 2025, retail electricity prices in California rose by more than 6 cents/kWh, in Maine by more than 4 cents/kWh, and in New York, New Jersey, Massachusetts, Maryland, Connecticut, and Rhode Island by more than 2 cents/kWh each. California prices declined slightly between 2024 and 2025, but most of the Northeast and Mid-Atlantic continued to see significant increases.

LBNL points out that transmission and distribution system expenditures, a large portion of which are related to wildfire mitigation, are a significant driver of electricity price increases in California. Additionally, declining retail electricity sales have amplified the price increases for customers in California, New York, and New England.

Since 2019, behind-the-meter solar and battery storage capacity in these three regions has grown substantially. According to data from the California Public Utilities Commission, California's distributed solar capacity is approximately20.5 GW, exceeding 40% of the California Independent System Operator's (CAISO)expected peak load this summer.

LBNL states that retail electricity price changes in some states are influenced by commodity prices, tax policies, or local factors. For example, in Hawaii, customer burdens were eased in 2025 due to fuel supply contract renewals reflecting lower global oil prices; while in North Carolina,new federal tax creditshave reduced the generation costs of existing nuclear reactors.

Maine's 2025 electricity price increase was driven by multiple factors, including cost recovery for infrastructure repairs following destructive storms in 2024, net metering compensation for the state's rapidly growing community solar projects, and higher wholesale electricity prices due to rising natural gas prices, according to LBNL.

LBNL also analyzed electricity bill sizes and burdens (i.e., the share of household income spent on electricity bills). The data show that these metrics are closely correlated with the prevalence of electric heating, so southern states (even with relatively lower electricity prices) typically have higher bill burdens than northern states (where most households use propane, natural gas, or fuel oil for heating). However, LBNL notes that northern states "also have additional energy costs not shown here."

The analysis also finds that electricity bills as a share of income have remained near historic lows since 2019. From 2019 to 2025, bill burdens declined in 23 states, with the largest decreases in Georgia, Tennessee, Iowa, Montana, and South Carolina. But LBNL says this good news is offset by the fact that since 2023, electricity bills as a share of income have risen, especially for the lowest-income 20% of customers. The report shows that one-third of households earning less than $50,000 annually spend at least 5% of their income on electricity bills. Over the past seven years, bill burdens have increased in 27 states and Washington, D.C., with the largest increases in Washington, D.C., Pennsylvania, California, and Maryland.