NEW YORK: U.S. electric utilities are seeking to hike customer power bills in 2024, extending last year’s record rise in electricity rate increases, the Energy Information Administration said on Monday.
Utilities have increasingly asked for rate increases in recent years to pay for power infrastructure as the country’s grid faces an onslaught of extreme weather and ballooning demand from the electrification of industries and the technology sector’s data center build out.
In 2023, state utility regulators signed off on nearly $10 billion in rate increases, more than doubling the $4.4 billion approved in 2022, the EIA said.
Two California utilities looking to guard power infrastructure against wildfires by burying transmission lines, and taking other expensive measures to harden the electrical network, accounted for one-third of last year’s increases, the EIA said.
The EIA estimates that another $8.9 billion of rate increases will be authorized this year, but only if regulators continue to approve requests at the same pace they have since 2023.
From the beginning of 2023 through August 2024, regulators approved 58% of utility rate increase requests, the group said.
Total rate requests so far in 2024 are $12.7 billion, according to data from Regulatory Research Associates (RRA), which is part of S&P Global Commodity Insights.
“RRA has been tracking rate cases since the early 1980s, and 2023 was the most amount of rate increases requested in our history,” RRA senior research analyst Dan Lowrey said.
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