One out of every four American households could not afford to pay its energy bills at least once over the past year. Some families cut back on groceries or medicine to make ends meet, while others kept their homes at uncomfortable, even unsafe temperatures to save money.
Across the West, electricity rates rose an average of 17% between 2018 and 2023, amid record-breaking wildfires, storms and extreme heat. While the rate hike can be attributed in part to inflation and the cost of maintaining aging infrastructure, experts also cite climate-related costs.
Utilities are now investing billions of dollars to harden their infrastructure to reduce the risk of igniting wildfires. Meanwhile, increasingly extreme temperatures are forcing ratepayers to turn up their heat in winter and their AC in summer. Hurricanes and winter storms, intensified by climate change, also damaged fossil fuel infrastructure in the South in recent years, creating volatility in the price of natural gas.
In the runup to this year’s elections, both parties have pledged to make energy more affordable. Their strategies differ radically, though: Republicans typically favor more drilling, saying it will lower prices by increasing overall supply, while Democrats argue that solar and wind power is now cheaper than fossil fuels. The latter strategy requires significant upfront investments but has been shown to cut costs in the long run.
As Westerners struggle to pay their power bills, one thing is certain: Utilities’ jobs are going to get harder. In the coming decade, overall energy demand will continue to grow, especially with the wave of new data centers and electric vehicle charging stations. Meanwhile, climate change will continue to raise temperatures and intensify storms and wildfires. Here’s a snapshot of the impacts so far.
The rising cost of residential energy. The average monthly residential electricity bill, by state:
“We need our utilities to control their spending.”
—Bob Jenks, executive director of the Oregon Citizens’ Utility Board. In May, the Oregon CUB called for the state public utility commission to limit rate hikes to no more than 10%. Any costs beyond the 10% increase would be delayed until a future year, requiring utilities to prioritize providing power to customers while reigning in extraneous costs.
The known unknowns: Natural gas, which accounts for roughly half the electricity used in Arizona and Nevada, saw volatile price hikes over the last two years. Russia’s invasion of Ukraine sent prices soaring in 2022, but climate-induced disasters, like the Texas freeze or Hurricane Ida, can also cause global supply shocks.
Renewables on the cheap: New Mexico is one of a handful of Western states where electricity rates rose more slowly than national inflation. Wind and solar account for almost half of its power, offering an example of how clean energy can cut rates in the long run.
Ratepayer pushback: Energy bills typically rise in the summer and winter, particularly as climate change drives up demand for heating and cooling. In January, some residential customers in Oregon saw Portland General Electric’s rates jump 18% when a severe winter storm hit the region.
A time of wildfire: In the wake of the 2018 Camp Fire, California utilities invested billions in burying power lines, clearing vegetation and installing sensors to identify potential wildfire risks. It’s one of the primary factors that drove up power bills nearly 40% on average across the state by 2023.
The cost debate: Late last year, thousands of ratepayers wrote to the Wyoming public service commission, protesting a nearly 30% rate hike proposed by Rocky Mountain Power. Some residents and officials blamed new infrastructure and transmission lines for the bump, but clean energy advocates were quick to point out the severe impacts of fluctuating coal and natural gas prices.
SOURCES: FindEnergy, U.S. Energy Information Administration, California Public Utilities Commission via Energy Innovation, Global Energy Monitor, Lawrence Berkeley National Lab
Data visualization by Jennifer Di-Majo/High Country News
This article appeared in the November 2024 print edition of the magazine with the headline “How climate change affects your energy bill.“
Note: The Wind energy on the cheap chart has been corrected to reflect that wind energy figures for 2024 are for just the first 6 months of the year.
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