Why US Electricity Costs Keep Rising And What You Can Do About It
Electricity powers every corner of modern life. From lighting and cooling to charging electric vehicles and running heat pumps, our homes are more electrified than ever. But that convenience comes with a rising cost. According to the latest government data, electricity prices for U.S. residential customers hit record highs in 2023 and show no sign of reversing in 2024 or early 2025.
This article breaks down the U.S. electricity cost trends over the past decade, identifies the causes of price increases, and explores what homeowners can do to regain control, including the growing adoption of whole-home battery systems.
Electricity Prices Have Been Rising for Years
The U.S. Energy Information Administration (EIA) tracks the average price of electricity to different customer groups, measured in cents per kilowatt-hour (¢/kWh). In 2015, the average residential rate stood at 12.65¢/kWh. By 2023, it reached 16.00¢/kWh. Preliminary data from 2024 shows an even higher annual average of 16.48¢/kWh.
Here’s a quick view of residential electricity price changes over time:
Yearly Residential Price (¢/kWh)
Year | Residential Price (¢/kWh) |
2015 | 12.65 |
2016 | 12.55 |
2017 | 12.89 |
2018 | 12.87 |
2019 | 13.01 |
2020 | 13.15 |
2021 | 13.66 |
2022 | 15.04 |
2023 | 16 |
2024 | 16.48 |
The increase from 2021 to 2023 alone was nearly 2.5¢/kWh, a rise of over 17% in just two years.
Residential Users Bear the Heaviest Burden
While commercial and industrial users also experience rate increases, residential customers consistently pay more. In 2023:
- Residential: 16.00¢/kWh
- Commercial: 12.59¢/kWh
- Industrial: 8.04¢/kWh
- Transportation: 12.77¢/kWh
- All sectors (average): 12.68¢/kWh
By comparison, commercial users paid roughly 21% less than residential users in 2023. Industrial customers — often large factories or heavy manufacturing plants — paid about half the residential rate. These customers benefit from negotiated contracts, high-volume discounts, and time-based consumption strategies that reduce peak demand.
Homeowners, on the other hand, are charged based on flat or time-based rates and typically cannot negotiate better deals.
Seasonal Price Surges Make It Worse
Annual averages smooth over one critical factor: monthly electricity prices vary widely, especially in summer.
In 2023, residential electricity prices peaked in:
- July: 16.93¢/kWh
- August: 17.00¢/kWh
- September: 16.27¢/kWh
These were the highest prices recorded in the entire year. The lowest prices occurred in January (15.47¢/kWh) and February (15.98¢/kWh), a seasonal pattern reflecting increased summer cooling demand.
Data from 2024 shows similar or even higher values:
- July 2024: 16.61¢/kWh
- August 2024: 16.61¢/kWh
- September 2024: 16.82¢/kWh
And early 2025 data suggests the upward trend continues:
- January 2025: 15.95¢/kWh
- February 2025: 16.44¢/kWh
- March 2025: 17.11¢/kWh
Even during the cooler season, electricity prices are trending higher year-over-year. March 2025 shows the highest single-month price ever recorded at 17.11¢/kWh.
What’s Driving Higher Electricity Prices: 3 Reasons
Several factors contribute to these rising costs:
Fuel Price Volatility
Although renewable energy is growing, much of the U.S. power supply still depends on natural gas. Natural gas prices spiked after the pandemic and surged again due to global instability and supply chain disruptions. When fuel costs rise, so do generation costs — and those get passed to consumers.
Grid Infrastructure Costs
Much of the U.S. power grid infrastructure is aging. Utilities are investing in upgrades, wildfire prevention, and resilience projects. These infrastructure improvements are essential, but they’re expensive, and utility companies recover those investments through rate increases.
Rising Demand
More homes are switching to electric heat pumps, installing EV chargers, and adopting air conditioning in previously moderate climates. As household electricity usage increases, so does demand on the grid. Meanwhile, some areas lack the generation capacity to keep up, especially during peak hours.
The 2025: Continued Price Pressure
The first quarter of 2025 is already confirming expectations of further price increases. Residential electricity prices for January through March 2025 averaged:
January: 15.95¢/kWh
February: 16.44¢/kWh
March: 17.11¢/kWh
Across all sectors, the average for Q1 2025 has reached 13.20¢/kWh, compared to 12.68¢/kWh in 2023. These numbers reflect continued upward pressure.
Additionally, more utilities are introducing time-of-use (TOU) plans, which charge higher rates during peak demand hours (such as 4–9 PM). This makes electricity even more expensive during the hours most people rely on it, for cooking, heating, or cooling, and home electronics.
What Can Homeowners Do?
Most people are already trying to save — turning off lights, adjusting the thermostat, even cutting back on appliance use. But when rates go up, those efforts don’t always translate to a lower bill. If saving energy isn't enough anymore, what other options do you have?
Reduce Peak Usage
Try to avoid running high-power appliances (like dryers or ovens) during peak hours, typically late afternoon to early evening. Many utilities charge more during these windows, especially under Time-of-Use (TOU) plans. Some smart appliances and energy dashboards can help shift your usage to cheaper times automatically.
Keep Up Energy Efficiency
Even though it won’t stop prices from rising, using less energy still matters. Smart thermostats, high-efficiency appliances, LED lights, and proper insulation can all make your home less dependent on grid power. It's a good foundation — just not the full solution anymore.
Install Solar Panels
Solar panels can help offset your daytime electricity use, especially during sunny months. They reduce your need to draw power from the grid when rates are lowest. But there’s a catch — solar alone can’t help at night, during cloudy days, or during blackouts. And in some states, the value of sending excess energy back to the grid has dropped under new policies like California's NEM 3.0.
Use Home Battery Storage
If your solar panels generate power during the day, why not save it for when electricity is most expensive? That’s exactly what a home battery lets you do. Instead of sending all your solar power back to the grid, you can store it and use it during peak-rate hours, like in the evening when everyone’s cooking, cooling, or charging.
But the benefits go beyond savings. A whole-home battery gives you backup power during outages and helps reduce your reliance on the utility altogether. You don’t have to live off-grid to want energy independence. Many families now invest in storage as a long-term strategy to handle high rates, power interruptions, or extreme weather.
One of the most advanced solutions available is the EcoFlow OCEAN Pro system. Built for full-home use, it supports both essential circuits and high-load appliances. Each base battery holds 10kWh of storage, and the system is expandable to 80kWh with stackable modules — enough to power a home for multiple days off-grid.
It’s not just about size. The OCEAN Pro is designed for tough environments. It’s flood-resistant up to 2.6 feet, operates safely in heat up to 140°F, and has a TriShield architecture with integrated fire suppression and explosion-proof valves for safety. Whether you live in wildfire zones, hurricane regions, or just want long-term reliability, this level of protection makes a difference.
Power flows through the OceanPro inverter, which delivers 24kW of continuous output and handles up to 50kW in peak surges — strong enough to support HVAC systems, ovens, or EV charging all at once. It also supports up to 40kW of solar input across 8 MPPT channels, giving you maximum solar flexibility.
For homeowners interested in aesthetics, the system offers customizable chassis finishes, from carbon fiber to walnut wood, so it doesn’t clash with your home’s style. You also get smart energy control powered by AI, with a full energy dashboard, app-based monitoring, and the ability to optimize power use across your appliances — even participate in virtual power plant programs to sell back extra energy.
With a 15-year warranty and professional installation support, the EcoFlow OCEAN Pro is not just a backup — it’s a power strategy for the next decade.
Taking Back Control of Your Electricity Costs
The numbers are clear. Electricity prices are rising across the board, and residential customers face the steepest increases. Whether caused by fuel price shifts, infrastructure updates, or rising demand, the cost of power is likely to remain high or even increase for years to come.
Fortunately, new technology gives homeowners options. Reducing usage helps, but adding battery storage unlocks a more resilient, long-term strategy. Instead of riding the wave of volatile rates, you can store your own power and use it on your terms.
If you’re ready to stop guessing what your next electric bill will look like, it may be time to explore a system like the EcoFlow OCEAN Pro. With scalable capacity and full-home power support, it’s designed for a future where control, stability, and energy independence matter more than ever.