Utility Bills on the Rise Following Winter Storms
Alex Epstein, who heads the Center for Industrial Progress, argues that efforts to promote renewable energy are largely to blame for the ongoing challenges in securing reliable and affordable electricity.
As millions of Americans cope with the fallout from a harsh winter storm, many households are also feeling the financial strain. Utility bills have surged this winter.
Heating expenses are projected to increase by 9.2% during the winter of 2025-2026 compared to last year, according to a report released recently by the National Energy Assistance Directors Association (NEADA).
NEADA’s analysis suggests that households will spend around $995 on heating this season, which is an uptick of about $84 from last winter.
The main drivers behind these rising consumer costs appear to be escalating prices for electricity and natural gas. Specifically, electricity prices are expected to climb by 12.2% (about $133) this winter, while natural gas costs are forecasted to rise by 8.4% (approximately $54).
NEADA has noted that even though kerosene prices are projected to rise slightly by 0.4% (around $6), propane gas costs should actually dip by 1.4% ($18), which might help alleviate some of the overall increase.
The report highlights several contributing factors. It mentions that higher retail electricity prices are prevalent across much of the country.
“Rising interest rates are adding to the financial burden of funding new power plants and transmission projects. Additionally, climbing natural gas prices are pushing up the cost of generating power. Meanwhile, the demand for electricity is quickly escalating, particularly due to the growth of data centers,” it states.
Furthermore, it notes that aging infrastructure and regional limitations in capacity are inflating costs. Federal incentives have also been cut back, delaying investments in renewable energy technologies.
NEADA reports that over 210 electricity and natural gas providers have raised or proposed increases in rates over the next couple of years, summing up to about $85.8 billion. With such factors at play, heating costs are expected to keep rising.
This trend is consistent with what has been observed in recent years. The average monthly electricity bill for households has jumped from approximately $121 in 2021 to about $156 in 2025, which marks a 29% increase—outpacing overall inflation in that timeframe, according to U.S. Energy Information Administration data.
On the other hand, low- to middle-income families are dedicating 6% to 10% of their income on energy bills, straining their budgets far more than wealthier households.
Moreover, NEADA points out that roughly one in six households is currently behind on their utility payments, leaving Americans with about $23 billion in debts from their electric and gas services. An estimate indicates that up to 4 million households experienced power outages last year, which is an increase of around 500,000 from 2024.
“Even minor rate hikes can compel families to decide between paying for utilities and meeting basic needs like food, rent, and medications,” NEADA indicates.
Recent consumer price index data from the Bureau of Labor Statistics shows that some energy costs have notably risen compared to last year.
Specifically, city gas service prices surged by 10.8% in December relative to the same month last year, while electricity costs rose by 6.7%. Additionally, fuel oil prices increased by 7.4% year over year, whereas the index for propane, heating oil, and firewood saw a decrease of 5.9%.
