NPGA Bobtail

Bulk Electricity Costs on the Rise

The Energy Information Administration recently released a report detailing the higher costs utilities are shouldering for electricity production and delivery. In 2021, the cost to produce electricity increased 6% year-over-year. These production costs were largely driven by higher fuel prices. Although prices to move electricity across transmission and distribution lines held steady in 2021, this new price plateau reflects a large, 12% increase that occurred between 2019-2020. Utilities are increasingly spending more money on efforts to maintain and, where possible, upgrade their aging electric delivery infrastructure.

Importantly, propane is an extremely cost-effective heating fuel. And, per unit of energy, electricity is far more expensive than propane. In 2021, the average retail price for electricity in the U.S. was 11.10 cents per kilowatt-hour, up from 10.59 cents in 2020. For more information, contact NPGA’s Manager of State Affairs, Austin Wicker.