Why power bills jumped in 2025 and 2026
Residential electricity prices rose faster than inflation in most of the country over the last two years, and the reasons are not the same everywhere. Four things did most of the work. Which ones hit you depends on your state.
1. Capacity prices in the PJM states
Thirteen states from Illinois to New Jersey, plus DC, sit on the PJM grid, which runs an annual auction to pay power plants for being available. For years that auction cleared at a few dollars per megawatt-day. The auction for the year beginning June 2025 cleared at about $270, roughly nine times the prior year, and the next one hit the price cap near $330. Utilities pass those costs straight into the default supply price, which is why customers of PSE&G, JCP&L, Pennsylvania's utilities and BGE saw supply increases of 10 to 20 percent in June 2025 with no rate case at all. The auction results are public on PJM's site. Several of the cases on this site marked "supply and capacity price" are this.
2. Data center load
Utilities are planning for the largest demand growth since air conditioning, most of it from data centers, and building generation, substations and transmission ahead of it. Who pays is the fight inside many current rate cases: utilities and commissions have started requiring large customers to sign long contracts with minimum bills, and some cases explicitly credit data center revenue against residential increases. Cases with a data center angle are flagged on their page. Our sister site, Is a Data Center Coming, tracks the projects themselves.
3. Storms
Hurricanes Helene and Milton in 2024 and the winter storms before them left utilities in Florida, Georgia and the Carolinas with restoration bills in the hundreds of millions to billions of dollars, recovered through storm riders over one to several years. Florida customers saw storm charges of $20 to $30 a month appear and then, in some cases, come off again; the Florida page shows both directions.
4. The cost of building, and of borrowing
Poles, transformers and wire cost far more than they did in 2020, and utilities finance them with borrowed money that got more expensive at the same time. A base rate case exists to put that new investment into rates, so a utility that rebuilt its grid after storms or to serve growth files for more. The return on equity it earns on that investment is set in the case and is usually the most contested number in it.
What did not happen
Two things people assume are usually not the cause. Renewable energy mandates are a small share of most bills and in several states have lowered supply costs. And utility profits, while real, are capped by the commission: the return on equity approved in recent cases has mostly sat between 9 and 10.5 percent, close to where it has been for a decade.
Where your state falls
The state pages list every case we track, and each utility page adds up what is pending. If your bill went up and there is no case listed for your utility, the increase probably came through supply pricing or a rider, and the bill guide will show you which line to look at.