Key facts
- Electricity demand is increasing due to data centers, manufacturing, population growth, and electrification.
- New generation capacity is not keeping pace with rising electricity demand.
- About 75% of recent bill increases are tied to the cost of generating electricity.
- The North American Electric Reliability Corporation warns of elevated risks of electricity shortfalls.
- The average monthly electric bill has increased by nearly 30% between 2021 and 2025.
- An all-of-the-above energy strategy is needed, including energy storage, nuclear, natural gas, renewables, and transmission.
Millions of Americans are facing higher electricity bills this summer due to a fundamental imbalance in the energy system where demand is rapidly increasing while new generation capacity is not keeping pace. This surge in demand is attributed to data centers, new manufacturing, population growth, and the electrification of vehicles and home heating. Exelon utilities report that approximately 75% of recent bill increases are linked to the cost of electricity generation, which is determined by wholesale market prices and passed directly to consumers. The North American Electric Reliability Corporation has cautioned that over half the country faces a high risk of electricity shortfalls during peak summer conditions. The average monthly electric bill is projected to increase by nearly 30% between 2021 and 2025, according to the National Energy Assistance Directors Association. Exelon has launched the Exelon Promise, including a $60 million Customer Relief Fund, to help customers manage rising costs and prevent large energy users from shifting costs unfairly. A Charles River Associates analysis suggests that allowing regulated utilities to own generation in certain cases could save Americans up to $20 billion annually and reduce outage risks. The article advocates for an 'all-of-the-above' energy strategy that includes investing in energy storage, nuclear power, natural gas, renewables, new technology, energy efficiency, and transmission infrastructure, while also addressing barriers like lengthy permitting timelines and supply chain issues.