U.S. Home Electricity Bills Expected to Reach 12-Year High This Summer

Summer Bills Set to Break Records

American households are bracing for a financial shock this summer as electricity bills are expected to soar to their highest levels in over a decade. Home electricity bills are expected to rise to an average of $784 for the summer period, up more than 6% from $737 in 2024 and marking a 12-year record, according a new analysis from the National Energy Assistance Directors Association (NEADA). This represents approximately $196 per month during the peak cooling season, putting significant strain on family budgets across the nation.

The mounting costs come at a particularly challenging time for American families. The growing expense comes on the heels of a cold winter that drove up heating costs for many Americans, and as consumers continue to grapple with higher prices on everyday goods. The timing couldn’t be worse for households already stretched thin by inflation and rising costs across multiple sectors.

Record-Breaking Temperature Patterns Drive Demand

According to NASA, 2024 was the hottest summer on record, setting the stage for another potentially brutal cooling season. The National Oceanic and Atmospheric Administration is anticipating hotter-than-average temperatures this summer. “This summer could also be record breaking,” NAEDA said. The relentless heat is forcing millions of Americans to crank up their air conditioning systems, pushing electricity consumption to unprecedented levels.

Weather patterns are becoming increasingly unpredictable and extreme. “We predict that prices will be this high for two reasons: first, the cost of electricity is rising faster than [the] average rate of inflation, and second, temperatures are continuing to increase, reflecting the continuing impact of climate change and requiring additional energy to cool indoor spaces,” the NEADA/CEPC report said. This dual pressure creates a perfect storm for skyrocketing energy costs.

Electricity Prices Outpace Inflation

The troubling reality is that electricity costs are rising faster than general inflation rates. Electricity prices rose 4.5% in the past year, according to the consumer price index for May 2025 — nearly double the inflation rate for all goods and services. This means that energy expenses are consuming an increasingly large portion of household budgets, even as other costs stabilize.

The U.S. Energy Information Administration estimated in May that retail electricity prices would outpace inflation through 2026. Prices have already risen faster than the broad inflation rate since 2022, it said. The trend shows no signs of slowing, with some regions experiencing particularly steep increases that far exceed national averages.

Regional Variations Paint Complex Picture

Not all Americans will face the same burden, as electricity costs vary dramatically by region. The largest increase will hit New England, where the average monthly bill is expected to rise $13 from last summer, to $193 a month. The Northeast continues to struggle with some of the highest energy costs in the nation due to limited pipeline infrastructure and reliance on expensive fuel sources.

The average U.S. household paid about 17 cents per kilowatt-hour of electricity in March 2025 — but ranged from a low of about 11 cents per kWh in North Dakota to about 41 cents per kWh in Hawaii, according to EIA data. States like California and New York are experiencing some of the steepest increases, while others in the Midwest and South may see more moderate rises.

Low-Income Households Face Crisis

The most vulnerable Americans are bearing the brunt of these rising costs. The most recent Census Household Pulse Survey found that 37% of low- and moderate-income households could not afford their energy bills for at least one month between April 2023 and April 2024. This statistic reveals a growing energy poverty crisis that threatens millions of families.

If those households find themselves in a financial crunch this summer, they may opt to turn off their air conditioning, which could pose serious health risks, noted Wolfe. “Last winter was cold, so they’re just getting over paying their heating bills, and are now facing higher summer cooling costs,” Wolfe explained. The health implications of this energy crisis extend far beyond financial concerns.

Federal Assistance Programs Cut Back

Making matters worse, federal assistance programs have been significantly reduced just when families need them most. Congress cut funding for the Low Income Home Energy Assistance Program from $6.1 billion in fiscal year 2023 to $4.1 billion in fiscal year 2024, the report says. This 33% reduction in funding comes at precisely the wrong time for struggling families.

The trickle-down effect of that cut in federal funding is that states are reducing the benefits they offer and the number of households they support, it adds. With states typically using 80% of the program funds to help people pay their heating bills in the winter, only 20% is left over for home cooling this summer, the report says. The timing leaves many families without crucial support during peak cooling season.

AI and Data Centers Fuel New Demand

A hidden driver behind rising electricity costs is the explosive growth of artificial intelligence and data centers. Utility revenue requirements to serve growing data center electricity demand could increase customer bills by 1% annually through 2032, according to Bain & Company. This represents a new and growing burden on residential customers who are essentially subsidizing the tech industry’s expansion.

The number of data centers in the U.S. nearly doubled between 2021 and 2024, according to a report from Environment America, a network of environmental groups. “As utilities race to meet skyrocketing demand from AI and cloud computing, they’re building new infrastructure and raising rates, often without transparency or public input,” he told CBS MoneyWatch in an email. “That means higher electricity bills for everyday households, while tech companies benefit from sweetheart deals behind closed doors.”

Grid Infrastructure Struggles to Keep Up

The American power grid is facing unprecedented challenges that directly impact consumer costs. The 2025 American Society of Civil Engineers “Report Card” gives the nation’s power infrastructure a D+ and calculates a $578 billion investment gap in transmission and distribution through 2033—even after factoring in the $73 billion already set aside for grid upgrades under the 2021 infrastructure law. These infrastructure deficits translate directly into higher costs for consumers.

At a high level, the growth in electricity demand and deactivation of power-generating facilities are outstripping the pace at which new electricity generation is being added to the electric grid, Hill said. This supply-demand imbalance is creating upward pressure on prices across the entire system, with residential customers bearing much of the burden.

Health Risks Mount from Unaffordable Cooling

The financial pressure is creating dangerous public health consequences as families make impossible choices. Reluctance to turn on one’s air conditioning can have adverse health effects like heat stroke. “While this won’t do damage to your building, it will do damage to you,” Wolfe said. The human cost of these rising bills extends far beyond monthly budgets.

Emergency rooms typically see spikes in heat-related illnesses during summer months, and this year’s combination of extreme temperatures and unaffordable electricity could create a perfect storm for public health emergencies. Vulnerable populations, including the elderly and those with chronic health conditions, face the greatest risks when cooling becomes a luxury they cannot afford.

Limited Protection from Shutoffs

Despite the growing crisis, consumer protections remain inadequate across much of the country. Seventeen states and D.C. provide some rules to protect people from utility shutoffs in the summer, but “many of those are very, very limited to specific dates,” Wolfe said. “These are rules that really go back 30 years, sometimes 40 years, before we had continuous heat waves,” he said. The regulatory framework hasn’t kept pace with climate realities.

The outdated nature of these protections means that millions of Americans remain vulnerable to having their power shut off during life-threatening heat waves. The gap between current regulations and modern climate challenges represents a significant policy failure that puts lives at risk while utility companies maintain their profit margins.

The convergence of record-breaking temperatures, aging infrastructure, surging demand from technology companies, and reduced federal assistance creates an unprecedented challenge for American families. As the summer heat intensifies, millions of households will face the impossible choice between staying cool and staying financially afloat. The 12-year high in electricity bills represents more than just a financial burden—it’s a crisis that threatens public health, economic stability, and the basic quality of life for countless Americans. The question isn’t whether bills will rise, but how families will survive the financial and physical heat that’s coming their way.