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Retail residential electricity prices in the United States have mostly risen over the last decades. In 2025, prices registered a year-over-year growth of 4.7 percent. Residential prices are projected to continue to grow by 3.8 percent in 2026.

Drivers of electricity price growth

The price of electricity is partially dependent on the various energy sources used for generation, such as coal, gas, oil, renewable energy, or nuclear. In the U.S., electricity prices are highly connected to natural gas prices. As the commodity is exposed to international markets that pay a higher rate, U.S. prices are also expected to rise, as it has been witnessed during the energy crisis in 2022. Electricity demand is also expected to increase, especially in regions that will likely require more heating or cooling as climate change impacts progress, driving up electricity prices.

Which states pay the most for electricity?

Electricity prices can vary greatly depending on both state and region. Hawaii has the highest electricity prices in the U.S., at roughly 41 U.S. cents per kilowatt-hour as of February 2026, due to the high costs of crude oil used to fuel the state’s electricity. In comparison, Idaho has one of the lowest retail rates. Much of the state’s energy is generated from hydroelectricity, which requires virtually no fuel. In addition, construction costs can be spread out over decades.