It's no secret that costs for utilities are on the rise. As inflation nears 8%, basic services and goods like groceries and utilities are creeping up in cost. But new sanctions against Russia after the Ukraine invasion have caused natural gas, oil, coal, and uranium prices to soar. Energy services, according to the U.S. Census Bureau, have risen 12.3% year over year, with the cost of natural gas rising 23.8% and electricity increasing by 9%.
While the pinch is being felt across the country, some states are experiencing higher utility spikes than others. These six charts show you where electricity costs are rising the most.
Hawaii takes the lead -- by a long shot -- when it comes to expensive utility costs. The average cost of $33.86 per kWh is 146% above the national average. The average monthly bill of $177.68 is 39% above the national average. Hawaii gets its energy from a mixture of energy sources, but its primary source is a variety of oil and fuel products, all of which have been greatly impacted by shortages over the past year.
Hawaii is a notoriously expensive state to begin with. Everything from groceries to gas and food costs more, and now it seems electricity costs do, too.
Massachusetts happens to be among the states with the highest average cost for energy, based on the average monthly bill and kWH, at $136.45 and $22.91, respectively. Franklin, Berkshire, Suffolk, Barnstable, Nantucket, and Dukes counties are among the most expensive in the state. The state is primarily fueled by natural gas, another energy commodity in high demand and short supply.
Like Hawaii, California is one of the most expensive states in the country, with cities like Los Angeles and San Francisco among the most expensive cities in the world. So it's not too big of a surprise to see that energy costs are also on the higher end.
At $22.85, the average cost per kWh of electricity is 66% higher than the national average. Surprisingly, it's not among the highest nationally for an average bill, likely due to the state's increased reliance on solar and wind power. Santa Clara County, home to San Jose, is the most expensive county for electricity costs within the state.
It might be a surprise to see Alaska on this list as the state is known for being a stable producer of oil and natural gas in the United States. However, oil extraction requires roughly 90% of the natural gas to be reinjected to keep the systems, limiting the supply for consumer energy use. Its oil fields are also producing less and less oil each year. 2020 saw the lowest oil-production level since 1976. Due to unconnected grids and harsh winters, residents need more energy than in other states, so it's easy to see why costs are so high.
5. Rhode Island
Despite being the smallest state in the United States by landmass, Rhode Island has managed to be in the top 5 most expensive states for energy costs. YOY, electricity rates have increased 11% in Rhode Island, with the average cost for electricity being $22.30 kWh today. Its average bill isn't the highest, thankfully, at around $130.35 per month, which isn't too far off the national average of $122.19.
Reduced energy supply on a global level will continue to push costs up, meaning the hike in utility costs, for the most part, is out of our control. If you're in an optimal area for solar power, there's always the option to install solar. But this can be an expensive upfront investment and takes an average of 10 years to recoup the installation cost through savings in your energy bill.
For now, the best plan is to budget for steady increases in utility costs while accounting for inflation and reducing your energy consumption as much as possible. Small changes -- like installing LED lights, turning lights off when not in use, and pushing the thermostat up a few degrees -- can help reduce your electricity bill.