Kilowatt Hour Cost by State: 2026 Electricity Price Comparison

Electricity Rates for All 50 States (December 2025)

The following rates are residential averages from the EIA Electric Power Monthly, Table 5.6.A, released February 24, 2026, reflecting December 2025 billing data. These are the most current state-level figures available. The national average for December 2025 was 17.3¢/kWh.

Source: EIA Electric Power Monthly Table 5.6.A, February 24, 2026 (December 2025 data, preliminary). *Monthly bill estimated at national average consumption of 899 kWh/month per EIA RECS 2022 data.

States with the Highest Electricity Rates

Nine states and DC pay more than 20¢/kWh for residential electricity — well above the national average of 17.30¢. Here is the breakdown of who pays the most and why.

1. Hawaii — 41.62¢/kWh

Hawaii pays nearly 2.4 times the national average for electricity — and it is not even close to any other state. The core problem is geographic isolation: Hawaii cannot import power from the mainland grid. Every island has its own electrical grid, and until recently almost all generation came from imported petroleum. Per EIA data, petroleum-fired plants accounted for the majority of Hawaii's generation for decades. The state is aggressively transitioning to solar and wind (aiming for 100% renewable by 2045), but the transition costs are being passed to ratepayers now. The silver lining: Hawaii's high rate makes solar panels extraordinarily lucrative, with payback periods under 4 years in optimal installations.

2. California — 34.71¢/kWh

California's rate — nearly double the national average — reflects a confluence of costs unique to the state. The three major investor-owned utilities (PG&E, SCE, SDG&E) have received multiple large rate increase approvals from the California Public Utilities Commission since 2022 to fund wildfire prevention, grid hardening, and utility undergrounding programs. Per CPUC filings, PG&E alone has invested billions in Public Safety Power Shutoff (PSPS) infrastructure. On top of that, California's aggressive renewable portfolio standard means utilities pay premium prices for solar, wind, and storage capacity — costs that flow to ratepayers. California's rate has nearly doubled from roughly $0.18/kWh in 2018 to $0.35/kWh today.

3–5. New England — Maine (30.39¢), Massachusetts (30.88¢), Rhode Island (31.15¢)

New England's electricity is expensive for structural reasons. The region depends heavily on natural gas for generation — but New England has constrained pipeline capacity that prevents importing cheap Appalachian gas. When natural gas prices spike nationally (as in 2022), New England faces an amplified impact. The region's aging transmission infrastructure also requires ongoing expensive maintenance. Massachusetts and Connecticut have faced particularly high rate increases from their electric distribution companies in recent years. The cold winters drive high heating demand that strains the grid, further increasing peak-pricing impacts. On the positive side, these high rates make solar economics extremely compelling — Massachusetts averages a 5.5-year solar payback.

Other High-Rate States

New York (27.39¢): Transmission congestion surcharges, state taxes, aging ConEdison infrastructure in NYC, and the transition away from the Indian Point nuclear plant have all contributed to elevated rates. New Hampshire (26.28¢): Small market with natural gas dependence and limited pipeline access. Alaska (25.54¢): Like Hawaii, Alaska faces isolated grid challenges — rural Alaskan villages rely on diesel generation, while even urban Anchorage faces high fuel transport costs. Connecticut (25.30¢): Dense grid infrastructure maintenance, natural gas dependence, and mandatory utility programs add cost.

States with the Cheapest Electricity

The states with the lowest electricity rates share a common profile: abundant, inexpensive generation sources, often with a large portion of publicly owned utilities that do not need to deliver shareholder returns.

Nebraska is a particularly instructive case: it is the only state in the US where all electricity is supplied by publicly owned utilities and cooperatives — no investor-owned utilities exist. Without the need to return profits to shareholders, Nebraska's public power districts keep rates among the lowest in the country despite not having exceptional natural resources. This demonstrates that market structure, not just fuel mix, affects what consumers pay.

Idaho's 11.87¢/kWh rate is largely attributable to hydroelectric power from the Columbia and Snake River systems. Hydro has near-zero fuel costs once infrastructure is built, making it among the cheapest generation sources available. Washington state (13.33¢) benefits from the same system but pays slightly more due to higher transmission infrastructure costs serving a larger population.

Why Electricity Prices Vary So Dramatically

A homeowner in Hawaii pays nearly four times more per kilowatt-hour than a homeowner in North Dakota. Understanding why helps you evaluate whether your rate is likely to change — and whether switching to renewables is driven by economics or altruism.

Generation Mix

Fuel cost is the biggest single driver of electricity rates. Per EIA's analysis of pricing factors, states with access to cheap, abundant generation sources pass those savings to consumers. Hydroelectric power has essentially zero fuel cost after construction — which is why the Pacific Northwest, Nebraska, and the Dakotas enjoy some of the lowest rates in the nation. States dependent on imported oil (Hawaii) or constrained natural gas pipelines (New England) pay the most.

Nuclear power provides relatively stable, low-cost generation (though with high capital costs). States with significant nuclear capacity — Illinois, South Carolina, Connecticut — partially offset natural gas price volatility. Coal-heavy states have historically had cheap electricity, but carbon reduction policies and plant retirements are gradually raising costs in those markets too.

Transmission and Distribution Infrastructure

Building, maintaining, and operating the wires that carry electricity from power plants to your outlet is a major cost component. Per EIA's pricing explainer, infrastructure costs include "construction, operation, and maintenance of the transmission and distribution systems, including the costs of repairing damage from extreme weather and improving cybersecurity."

Dense urban grids (New York City, Boston) require constant upkeep of aging underground cable systems. California's wildfire mitigation program has added billions in infrastructure spending that ratepayers are now funding. Rural states with sparse populations pay more per customer for long transmission lines but benefit from less complex distribution systems.

Market Structure and Regulation

Approximately 14 states plus DC allow retail electricity competition — consumers can choose their electricity supplier in a deregulated market. Theoretically, competition should drive prices down; in practice, results are mixed. Texas's deregulated ERCOT grid has seen high volatility (February 2021's storm caused prices to spike 10,000%) but generally competitive baseline rates.

Fully regulated states have utility commissions (public service commissions or public utility commissions) that approve rate changes. This process can protect consumers from sudden spikes but sometimes results in utilities under-recovering costs for years, leading to larger eventual rate increase requests. Nebraska's all-public-power model is a unique alternative — its public power districts operate without profit motive.

State Policy Surcharges

State policies add costs that vary significantly. Renewable portfolio standards (RPS) require utilities to buy renewable energy, often at above-market prices — this is a significant cost driver in California, Massachusetts, and New York. Energy efficiency program charges, low-income assistance programs, storm recovery costs, and nuclear decommissioning funds all add to residential rates as line items on utility bills.

How Electricity Rates Have Risen (2015–2025)

Residential electricity rates have not risen smoothly — they were nearly flat for six years, then surged dramatically. The following data is from EIA Electric Power Monthly Table 5.3, released February 24, 2026.

Source: EIA Electric Power Monthly Table 5.3, released February 24, 2026. 2025 figures are preliminary.

Two observations stand out from this data. First, rates were remarkably stable from 2015–2021 — rising only 8% over six years, barely keeping pace with inflation. Second, the period from 2021 to 2025 saw a 26.7% surge in just four years, driven by the 2022 natural gas price shock (Russia's invasion of Ukraine triggered global LNG price spikes) and the subsequent wave of grid investment and wildfire mitigation spending being baked into utility rate requests.

The structural drivers of recent rate increases — grid hardening, wildfire prevention, renewable transition, and electrification infrastructure — are not going away. Most utility analysts expect continued rate escalation of 3–5% per year through the late 2020s. Use our Electricity Cost Calculator to project your future utility bills under different escalation scenarios.

What Your Rate Means for Your Monthly Bill

Kilowatt-hour rate is only half the bill equation — consumption is the other half. Per EIA's 2022 Residential Energy Consumption Survey (RECS), the average US household consumes 10,791 kWh per year — approximately 899 kWh per month. But this average conceals enormous regional variation driven by climate, housing type, and local appliance habits.

Hawaii's extreme rate (41.62¢) is partially offset by its mild climate — residents use far less electricity than Americans in the Deep South or Mountain West. Hawaiians consume only 6,178 kWh per year — less than half what Louisiana households use — because cooling and heating loads are modest. Even so, their annual bill still reaches roughly $2,571.

Louisiana illustrates the opposite pattern: very low rates (12.56¢) but the highest electricity consumption in the country (14,774 kWh/year). The intense summer heat drives enormous air conditioning loads — and those low rates encourage consumption rather than efficiency. Louisiana's annual electricity bill ends up similar to many higher-rate states simply due to volume. Use our Electric Bill Estimator to benchmark your usage against state averages.

Residential vs. Industrial Rates: The 2× Gap

One of the least-discussed aspects of electricity pricing is the dramatic gap between what households pay and what large industrial customers pay. Per EIA Electric Power Monthly data:

Households pay 50% more per kWh than industrial customers. This gap exists for several legitimate reasons, per EIA's pricing factors explainer: industrial customers take power at high voltages, bypassing expensive distribution infrastructure; they have predictable, stable demand that reduces grid management costs; and per-meter administrative costs spread across millions of residential accounts versus a handful of industrial accounts favor large customers.

However, this gap also means residential consumers disproportionately fund the grid. Every large industrial customer that installs rooftop solar or microgeneration shifts more fixed grid costs onto remaining residential ratepayers — a phenomenon utility regulators call the "utility death spiral." This dynamic partly explains why some utilities have opposed residential net metering: distributed solar reduces the revenue base while fixed grid costs remain constant.

Time-of-Use Pricing and How to Beat Peak Rates

Standard flat-rate electricity pricing charges the same per kWh regardless of when you use power. Time-of-use (TOU) pricing — which many utilities now offer or mandate — charges significantly more during high-demand hours and less during off-peak periods.

California has made TOU the default rate for new residential customers across PG&E, SCE, and SDG&E territories. Under a typical California TOU structure, on-peak hours (weekdays 4–9 PM) cost roughly 48¢/kWh while off-peak hours fall around 26¢ and super off-peak (midnight to 6 AM) drops to approximately 18¢. That is a nearly 3× swing within a single day on the same grid.

TOU pricing is spreading because it helps utilities manage the "duck curve" — the sharp afternoon demand spike that occurs when solar output drops as workplaces end their days and residential air conditioning kicks in. By making peak power more expensive, TOU pricing encourages consumers to shift loads to off-peak hours.

For homeowners on TOU rates, three strategies dramatically reduce bills:

• Shift appliance loads: Schedule dishwasher, laundry, and pool pumps to run after 9 PM or before 7 AM. This alone can reduce bills 15–25% without changing consumption.
• EV charging off-peak: EV owners who charge overnight (super off-peak) versus evening peak can save $400–$800/year at California rates. Our EV Charging Cost Calculator models TOU rate scenarios.
• Battery storage arbitrage: A home battery charged during super-off-peak and discharged during on-peak hours saves the spread (18¢ vs. 48¢ = 30¢/kWh savings). A 10 kWh battery cycling once daily captures ~$3/day in rate arbitrage, adding up to $1,095/year — potentially justifying the battery cost over its lifespan in high-TOU-spread markets.

Your Rate and Solar Panel ROI

Your electricity rate is the single most predictive factor in whether solar panels make financial sense. The math is straightforward: higher rates mean more savings per kilowatt-hour produced, which means faster payback and greater lifetime returns.

Per EnergySage 2025 analysis, a typical 8 kW system produces approximately 10,000–11,000 kWh per year. That same system saves radically different amounts depending on where you live:

The rate difference between Massachusetts and North Dakota creates a $2,085/year gap in annual solar savings on the same system. Over 25 years, that is over $140,000 in cumulative difference — entirely because of the electricity rate, not the solar equipment or installation.

Per SolarReviews, homeowners paying less than $75/month for electricity — roughly 8.3¢/kWh at average consumption — will struggle to achieve a reasonable solar ROI. If you fall into the category of states with rates below 12¢/kWh, explore community solar programs instead: they offer bill savings of 5–15% with no upfront investment. Read our Solar Panel ROI Guide for a full payback calculation methodology.

Frequently Asked Questions