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Some simple charts show there’s no real relationship to speak of.
Electricity prices are going up at about twice the rate of inflation. This is becoming a political problem for anyone currently in power, including President Donald Trump.
“Any State that has built and relied on WINDMILLS and SOLAR for power are seeing RECORD BREAKING INCREASES IN ELECTRICITY AND ENERGY COSTS,” the president posted Wednesday on Truth Social, calling these renewables “THE SCAM OF THE CENTURY!”
But … are they? Is there a clear relationship between the spread of renewable energy and electricity prices at the state level, let alone one that’s driving up prices?
In a word, no. Here is a chart of average electricity prices in all 50 states compared to how much of their electricity they get from renewables.
There is, if anything, a slight negative correlation between renewables penetration and electricity prices, but as you can see, the dots are all over the map.
In fact, in some of the states with the highest level of renewables, prices have either risen more modestly than average or even fallen, as is the case with North Dakota. The state formerly governed by wind-hostile Secretary of the Interior Doug Burgum has seen its average electricity price fall to just over $0.08 per kilowatt-hour in May of this year, from $0.09 in May, 2019; meanwhile 36% of the state’s electricity comes from wind, the sixth-highest percentage in the country, according to Energy Information Administration data.
In Iowa, the state with the most renewables usage (again, thanks to wind), the average electricity price in May was just over $0.09 per kilowatt-hour, compared to just below the same level in May 2019.
But let’s expand the aperture out a little further. Have the states with more renewables on their grids experienced faster than average growth in electricity prices?
Again, no, and if anything slightly the opposite. “Many of the states with the largest increases in wind and solar generation since 2010 — including Iowa, New Mexico, Kansas, and Oklahoma — have seen rates rise slower than inflation,” according to research from Energy Innovation. You can see the relationship in this chart.
It’s true that both California and Maine, which are outliers in terms of electricity price increases, also get more than the national average share of their electricity from renewables.
In California, most of that rise comes down to costs related to wildfires, which also drove the utility PG&E into bankruptcy in 2019. And while many Mainers have blamed the state’s solar incentives for rising bills, an examination by Canary Media found that natural gas price volatility had more of an impact. Typically, states near the edge of or isolated from larger energy networks — including California and Maine, but also Hawaii, Alaska, and certain other New England states — have the highest electricity prices, regardless of how much renewable energy they have on the grid.
But make no mistake, prices are rising all over the country. The U.S. average electricity price has gone up by around 27% in the past six years, from around 10-and-a-half cents per kilowatt-hour in May 2019 to more than $0.13 this year. The biggest surge happened in 2022, when average electricity prices jumped from $0.11 per kilowatt-hour at the end of 2021 to well over $0.13 by the following August. Electricity prices have risen 5.5% in the past year alone, according to the Bureau of Labor Statistics, while overall prices have risen 2.7%.
If you’re trying to explain why electricity prices have risen, the answer, my friends, is not blowing in the wind — or shining in the sun, or anywhere else, for that matter. The real reason involves a host of factors, as my colleague Robinson Meyer explored earlier this week. Top of the list is the physical reality of the grid itself – which, yes, includes some costs associated with the buildout of renewable energy and the transmission infrastructure required to get it to customers, but is mostly related to local distribution, i.e. bringing power to people’s homes. Beyond that, extreme weather, natural gas prices, and data center-induced demand growth all play a part.
Whatever the reason for the rise in prices, though, it’s not good for Trump, who promised during the campaign that electricity prices would go down by half during his first year in office. Halfway through, things do not look promising, with more price hikes likely on the horizon.
Secretary of Energy Chris Wright acknowledged the present-tense price increase earlier this week when asked about rising prices. “And who’s going to get blamed for it? We’re going to get blamed because we’re in office,” Wright told Politico.
Wright’s comments have put some pep in the step of a beleaguered renewables industry. “When government officials start PR campaigns claiming something is not their fault … It’s their fault. Obstructing the fastest growing source of American power during a period of high demand is going to hurt consumers,” Jason Grumet, the head of renewables trade group ACP, wrote on X Wednesday.
Despite it all, renewables and storage make up the vast majority of planned new generation in the U.S. More than half of the 64 gigawatts of capacity planned to be added to the grid this year will come from solar, according to recent EIA data, with 18 gigawatts coming from battery storage and 8 gigawatts from wind. If recent history is any guide, any electricity price hikes we see going forward won’t be the fault of that new generation.
With data assistance from Charlie Clynes.
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On a potential deregulatory slowdown, community solar’s dimming, and Pope Leo on climate
Current conditions: Tropical Storm Imelda is set to gain intensity this week and whip the southeastern U.S. with soaking rain and storm surge • Frigid night air is forecast across northern New England • Typhoon Bualoi is flooding broad swaths of Vietnam, Thailand, and Laos.
The federal government is closed.Kent Nishimura/Getty Images
The federal government shut down at 12:01 a.m. this morning after President Donald Trump and Republicans failed to reach a deal with Democrats in Congress on a bill to keep its funding flowing. That could slow the Environmental Protection Agency’s deregulatory effort, E&E News reported Tuesday. “The political crisis that threatens to shutter much of the federal bureaucracy at midnight comes as Administrator Lee Zeldin is racing to unravel high-profile rules on things like climate science, vehicle pollution, power plants, oil and gas wells, and carbon emissions reporting,” reporter Jean Chemnick wrote. An abrupt halt to the agency’s activities would at the very least set back Zeldin’s reform effort, including an agency reorganization set to begin this month.
The Department of the Interior, meanwhile, sent employees an email Tuesday warning that the agency “has contingency plans in place for executing an orderly shutdown of activities that would be affected by any lapse in appropriations forced by Congressional Democrats.” Neither Interior nor the EPA had published updated shutdown plans taking into account staff reductions under the current Trump administration as of Tuesday.
When the Department of Defense bought a 15% stake in MP Materials, the continent’s only active rare earths mine, The Economist called it the most significant entry by the federal government into a private market since the railroads were nationalized in World War I. (Biden administration officials were admittedly jealous, as Heatmap’s Matthew Zeitlin reported.) Now the Trump administration has taken another share of a major mineral project. The Department of Energy’s Loan Programs Office said Tuesday that it had renegotiated a multi-billion-dollar loan to back construction of Lithium Americas’ Thacker Pass lithium mine in Nevada. The project, on track to become the Western Hemisphere’s largest lithium producer by 2028, will transform a remote stretch of high Nevada desert into a lithium clay mine, harvesting from one of the world’s richest known deposits.
Under the new deal, the federal government will take a 5% equity stake in Lithium Americas and an additional 5% ownership of the company’s joint venture with General Motors. The Energy Department called its stakes “part of the overall collateral package on a loan, helping to reduce repayment risk for taxpayers.” But the announcement said the “revised agreement” includes “robust loan amendments,” notably “more than $100 million of new equity.”
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Community solar installations are plunging. After a record-breaking 2024, installations of new panels in small-scale cooperative or community solar projects dropped 36% in the first half of this year compared to the same period last year. The passage of the One Big Beautiful Bill Act slashed the cumulative five-year outlook for community solar by 8% compared to the outlook before the legislation repealed vast chunks of the Inflation Reduction Act. That’s according to a new analysis from Wood Mackenzie.
Yet Jeff Cramer, the chief executive of the Coalition for Community Solar Access, said states are stepping up “with historic expansions like New Jersey’s 3,000 megawatts and Massachusetts’ 900 megawatts.” He added: “These bright spots show what’s possible when policymakers work to unlock capacity. At the same time, this report makes clear the challenges ahead — from federal uncertainty to interconnection delays and program caps — that must be addressed to realize the full potential of community solar and deliver the resilient, affordable power communities are asking for.”
Most Americans say that rising electricity prices have at least “a decent amount” of impact on household finances. “Still, for about 40% of the country, those high prices are more a pinch than a pain,” Heatmap’s Robinson Meyer wrote. That’s the finding of a new Heatmap Pro poll on rising rates. The results had some predictable outcomes, including that more than 70% of voters with household incomes below $50,000 said rising bills were a problem with “a lot of" impact on spending. Upward of 62% of voters earning less than $100,000 described similar issues, as did 59% of white voters without a college degree.
It’s been difficult for “Vatican-watchers” to pin down Pope Leo XIV’s views on most issues. But “on climate change,” The New York Times wrote on Tuesday, “it is clear that he is moved by the topic, and particularly its disproportionate harm to poor and vulnerable people.” The world is about to get a lot more clarity on his views. On Wednesday, the Pontiff is scheduled to give his first address on climate change at a conference taking place at the Papal Palace of Castel Gandolfo.
The remarks come on the 10th anniversary of Laudato Si, a groundbreaking papal document written by the late Pope Francis that overhauled the Catholic Church’s teachings on climate change. The 2015 encyclical was widely credited with pushing forward carbon-cutting negotiations at the global climate summit in Paris that year.
Africa's biggest petrostate is having a solar boom. Nigeria became Africa’s second-largest importer of solar panels over the past year by overtaking Egypt. The imports total 1.7 gigawatts. “It is a response to a problem … You can’t rely on a 24/7 grid in most parts of Nigeria at the moment,” Ashvin Dayal, senior vice-president of power at Rockefeller Foundation, which backed the mini-grid project, told the Financial Times. “Demand is booming for reliable, affordable electricity both for inside the home, but also to run small businesses, to run agricultural appliances, to increase productivity and incomes.”
Rob debriefs with colleagues on the latest climate news.
It’s been a busy few weeks for climate and energy. New York Climate Week brought hundreds of events — and thousands of people — to the city to discuss decarbonization and energy policy. The New Jersey governor’s race has raised the salience of electricity rates. And suddenly everyone is talking about energy affordability.
On this week’s episode of Shift Key, Rob is joined by his colleagues at Heatmap to discuss some of the biggest topics in energy and climate. What did they take away from New York Climate Week? What do the new politics of affordability mean for climate policy? And what are the benefits — and hazards — of arguing for climate policy by talking about how clean energy is cheap energy?
This Heatmap reporter roundtable features Heatmap’s deputy editor Jillian Goodman and its staff writers, Emily Pontecorvo and Matthew Zeitlin. Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap, and Jesse Jenkins, a professor of energy systems engineering at Princeton University. Jesse is off this week.
Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, YouTube, or wherever you get your podcasts.
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Here is an excerpt from our conversation:
Jillian Goodman: I want to back up a minute and just ask, what are we talking about when we’re talking about goldplating? What constitutes gilding the utility infrastructure, and what is not getting built because we’re doing all of this goldplating?
Matthew Zeitlin: Well, it’s funny, right? You’ll never read an IRP where they’ll be like, Alright, here’s our goldplated spending. What the advocates would say is that it’s often distribution, transmission and distribution spending that’s going across their territory and it’s not bringing down prices. I mean, again, it’s a completely subjective — well, not completely subjective. It is a subjective claim.
Goodman: Part of what’s motivating my question is, are we talking about things like installing smart meters?
Zeitlin: Well, in California, there’s been backlash to undergrounding. You know, it’s funny, because the utility structure makes it so anything good you want to do, the people have to pay for. So like even undergrounding electricity lines has become quite controversial in the American West because it’s so expensive.
Now, is that goldplating? Or is that climate resilience to decrease the chance of wildfires? Is it resilience? Is it building up climate resilience to the more wildfires caused by higher temperatures?
Emily Pontecorvo: I will just point out, it is also a policy choice by public service commissions and those who put people on those commissions to give the utility the rate of return that they get. There’s a lot of advocacy around lowering that rate of return, and also to put the degree of the cost of that goldplating on ratepayers that they do. They could have investors share more of that cost, and they’re just scared to do that. The utilities kind of scare them away from doing that. But it is possible. It’s in their power, at least.
Mentioned:
Everything that happened at Heatmap’s Climate Week event
Matthew on the peril for Democrats of running on electricity prices
Emily on the Greenhouse Gas Protocol
Arjun Krishnaswami in Utility Dive
Jillian’s downshift; Emily’s downshift; Matthew’s quasi-upshift; Rob’s downshift.
This episode of Shift Key is sponsored by …
Hydrostor is building the future of energy with Advanced Compressed Air Energy Storage. Delivering clean, reliable power with 500-megawatt facilities sited on 100 acres, Hydrostor’s energy storage projects are transforming the grid and creating thousands of American jobs. Learn more at hydrostor.ca.
Music for Shift Key is by Adam Kromelow.
More than a quarter say they’re being hit hard, according to a Heatmap Pro poll.
Most Americans say that rising electricity bills are having at least “a decent amount” of impact on their household finances, according to a new Heatmap Pro poll.
The poll, which surveyed more than 3,700 registered voters last month, gives context to how electricity prices have come to dominate national headlines in recent months — and why they’ve become an urgent issue at the state and local level in a few key regions.
On the 2024 campaign trail, President Donald Trump promised to cut voters’ power bills in half within a year of getting elected. So far, that hasn’t happened: Electricity prices have risen more than twice as fast as inflation over the past 12 months and are still rising, according to government data.
Voters are beginning to feel the squeeze from that inflation. In our poll, 26% of American registered voters said that rising electricity prices were having “a lot” of impact on their personal finances. Another 31% said that rising prices were having a “decent amount” of impact.
Still, for about 40% of the country, those high prices are more a pinch than a pain. Thirty percent of registered voters said that rising prices only had “a little bit” of impact on their personal finances, while 9% said they were having “none at all.” There wasn’t a significant partisan division in sensitivity to the high prices.
The survey did show some regional distinctions, however. In the Northeast, 63% of registered voters reported that rising power prices were causing them “a lot” or “a decent amount” of trouble. In the Midwest, only 52% of voters told the poll the same thing. The South, with 56%, and the West, with 61%, landed somewhere in between.
As might be expected, lower-income voters described more trouble. More than 70% of voters with household income below $50,000 a year said that rising power bills were having “a lot” of impact on their finances. Some 62% of voters earning less than $100,000 also described issues. So did 59% of white voters without a college degree.
The rising cost of power has become a major question in New Jersey’s political race, where it has haunted ads and led Representative Mikie Sherrill, the Democratic candidate, to promise to freeze power rates for a year if she is elected.
Energy Secretary Chris Wright has said that rising electricity costs are his No. 1 concern as energy secretary, although he has conceded the Trump administration is “going to get blamed” for surging power rates. The Trump administration has revoked permits for new offshore projects along the East Coast, and congressional Republicans have ended tax credits for solar and wind energy.
Wright told Politico in August that he blames “momentum of the Obama-Biden policies” for the surging power rates. Donald Trump was president from 2017 to 2021, after Obama and before Biden.