American households are already feeling the heat amid higher electricity and gas bills, with nearly three-fourths of Americans concerned about further price increases this year. Per Center for American Progress analysis, nearly 60 utilities are raising or trying to raise electric bills by $38.3 billion and gas bills by $3.5 billion, affecting 56.7 million and 26 million electric and natural gas customers, respectively. Now, pending legislation dubbed the One Big Beautiful Bill Act is poised to make Americans’ bills even “bigger.”
59
Number of utilities that will increase revenues through increased or proposed increase of electricity and gas prices
56.7M
Number of electric utility customers who would be affected by these price hikes
26M
Number of natural gas utility customers who would be affected by these price hikes
Electric and gas bills are already on the rise, but pending federal legislation would make it worse
Utility prices have been increasing over the past few years due to a variety of factors—from increased demand from data centers to climate pressures such as wildfires and extreme heat to policy choices such as tariffs and higher gas exports. Many Americans have already had to make difficult financial decisions because of high energy costs, with nearly 77 million households forced to reduce or forgo basic necessities such as medicine or food in order to pay an energy bill at least once or twice a year. Between 2021 and 2024, average monthly residential electric bills increased by $22 per month, or $264 annually.
Unfortunately, more rate hikes are on the way: Only halfway through 2025, nearly 60 utilities, including some of the biggest utilities across the country, have either already increased electricity and gas prices or proposed further increases that would go into effect in 2025 and beyond.
Despite these increases, in a tone-deaf move, the U.S. House of Representatives recently passed legislation that would increase utility bills even further. The budget reconciliation bill, or One Big Beautiful Bill Act, currently making its way through the Senate includes proposals that would exacerbate utility cost increases for American households while simultaneously increasing profits for oil and gas companies.
Among other costly provisions, the bill would end federal tax credits for clean and affordable sources of electricity, such as wind and solar, which would strain supply, increase generation costs for renewable energy, and increase demand and therefore prices for natural gas and other fossil fuels. Clean energy is the most affordable and quickest-to-deploy source of electricity. We need more affordable clean energy capacity, not less; yet Congress is poised to cut off clean energy investment and raise energy prices.
If the Senate were to pass the bill in its current form, it would increase average annual electricity costs by $110 per household by 2026.
If the Senate were to pass the bill in its current form, it would increase average annual electricity costs by $110 per household by 2026, with Wyoming, North Carolina, and Tennessee likely experiencing the highest increases—of $225, $215, and $202, respectively. The bill would also increase electricity costs for businesses by nearly 10 percent by 2026, and these additional costs would likely be passed through to consumers. Cutting incentives for sources of electricity that utilities recognize as more economical and quicker to deploy at a time when overall electricity demand is rising quickly is a huge blunder that hurts American households and businesses.
Additionally, passage of the One Big Beautiful Bill Act would further compound the Trump administration’s actions that are already increasing electricity prices. While Donald Trump campaigned on promises to reduce energy costs, his administration has implemented tariffs that raise costs on the electric grid supply chain and electricity imports; authorized increased exports of liquefied natural gas (LNG); frozen funding for programs that support low-income households, such as the Low Income Home Energy Assistance Program (LIHEAP); and weakened efficiency standards for appliances and electronics, wasting energy and increasing utility bills.
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From Florida to California, households and businesses across the country are seeing rate hikes
Between January 2021 and January 2025, nominal residential electricity prices and natural gas prices have increased by 26.3 percent and 28.3 percent, respectively, outpacing growth in the consumer price index, which has increased by 21.5 percent in the same time period. On top of this, several utilities across the country have put into effect increased rates for electricity and natural gas this year. The reasons for these increases vary from state to state, but utilities commonly cite the need to recover costs from grid and natural gas system investments, increase system resilience to wildfires and hurricanes, and increase profits for investors.
In the first quarter of 2025 alone, utilities filed 37 requests for a cumulative increase of approximately $19.7 billion in their electricity and natural gas rates. As of April 2025, $1.5 billion of the electric rate increase requests and $300 million of the natural gas electric rate increase requests were approved by the respective state regulators, known as public utilities commissions (PUCs).
Transferring wealth from customers to shareholders
Increased profits for investors is a common reason for rate hikes. In February 2025, Florida Power and Light (FPL), one of the largest electric utilities in the country serving approximately 6 million customers, filed a petition requesting a rate increase of nearly $9 billion—the largest rate hike in U.S. history. The petition by FPL, an investor-owned utility, included a request to increase the return on equity (ROE) for stakeholders from 10.6 percent to 11.9 percent, claiming that “[a]bsent a rate increase in 2026, FPL’s projected earned ROE falls to 8.84%.” Even 8.84 percent is much higher than the cost of equity or a reasonable rate of return for a monopoly.
Raising rates to deliver higher profits transfers wealth directly from FPL’s customers to FPL’s shareholders. If the request is approved, residential customers will see increases of approximately $12 to their monthly bills starting in 2026. Already, customers are paying a $12 monthly surcharge to recover costs associated with hurricanes in 2024. FPL customers affected by the increase have raised concerns about energy burdens and urged the state regulator to deny the request.
This wealth transfer from ordinary households to wealthy investors is prevalent in other states too. In New York and Wisconsin, utilities requested to increase the rate of return for their investors from 9.25 percent to 10.1 percent and 9.8 percent to 10 percent, respectively, as part of the electric rate increase on customers.
Utilities are increasing rates across states, with a variety of justifications:
- In Florida, Duke Energy and Tampa Electric increased electricity rates from 2025 through 2026 for their nearly 3 million total customers to recover costs incurred from hurricanes Debby, Helene, and Milton.
- In Missouri, customers of Ameren and Spire, two of the state’s largest natural gas utilities, could see increases of $16 and $14, respectively, in their monthly gas bills starting this fall to help recover costs from gas infrastructure and expansion.
- In New Jersey, four of the state’s utilities increased their rates for electricity due to growing demand, which will cost customers up to $28 per month.
- In Virginia and West Virginia, residential customers are preparing for utility bill increases of $8.51 and $27.15, respectively, where the utilities primarily cited “inflation.”
- In Oklahoma, customers are experiencing a $12 increase to pay for grid and transmission line improvements.
- In Idaho, customers of Idaho Power saw an increase of $3.50 in their monthly bills at the start of 2025, with an additional proposal for a further $21.66 increase starting in January 2026.
- In Indiana, Duke Energy Indiana and CenterPoint Energy Indiana were both approved for rate increases of $18.76 and $11.18, respectively, per month.
- California, which already pays some of the highest rates for electricity in the country, saw several utilities raise rates and propose further increases. Imperial Irrigation District, serving Imperial County, which has a higher share of its population living in poverty compared with the rest of the state, saw a rate increase of nearly $30 in February 2025—citing grid investments and electricity exports, among other reasons. Southern California Edison, likewise, has proposed a $17.49 increase to monthly electric bills, on top of an earlier increase to recover costs from the 2018 wildfires.
- In Colorado, Colorado Springs Utilities and Xcel Energy increased residential natural gas utility rates on April 1, 2025. Colorado Springs Utilities explicitly mentioned increased LNG exports and below-average underground storage levels as reasons for a $6.47 monthly increase for its residential customers.
- In New York, Consolidated Edison has proposed a $46.42 monthly increase to its customers’ natural gas bills, on top of electric bill increases of up to $26.60 a month for nearly 6 million customers starting in 2026.
Conclusion
With millions of Americans facing electricity and natural gas rate hikes, House Republicans passed a bill that would raise electricity bills even higher, making it harder for Americans to keep up with rising utility costs. The ball is now in the Senate’s court to decide whether its duty is to serve working-class Americans or increase electricity costs to provide tax giveaways for the wealthy.
The authors would like to thank Jasia Smith, Mariel Lutz, Cody Hankerson, Frances Colón, Leo Banks, and Jamie Friedman for their contributions to this article.
The full dataset is available for download here.