Electricity RatesShort-Term Outlook
Electricity is a necessity that everyone is willing to pay for. Without it, just about everything that we take for granted everyday—smartphones, computers, television, lights, ect.—could not work. That, however, doesn’t mean that we don’t worry about how much we’re paying for our electricity. While regulators across the country are working to keep energy rates as low as possible, they are still slated to rise due to a number of economic, market and supply factors. By the end of 2015, average energy prices are expected to rise to 12.73 (up from 12.47 by the end of 2014 and 12.12 in 2013) in the retail sector, 10.86 (up from 10.71 by the end of 2014 and 10.29 in 2013) in the commercial sector and 7.15 (up from 7.13 by the end of 2014 and 6.82 in 2013) in the industrial sector.
Overall increases in energy use are big contributors to the rise in rates. According to the U.S. Energy Information Agency (EIA), total electricity generation in the country is expected to top 11.4 terawatts (11,400 gigawatts), which is a 2.2% increase from last year. Climate change is also having a huge effect on this increase in energy use throughout the country. The EIA estimates that the number of cooling degree days (hot days during which you need to run your air conditioner all day to stay cool) will increase by 5.7 percent in 2014. This means that customers will be running their heating, ventilation and air conditioning (HVAC) system—the single largest contributor to a single household’s energy use (accounts for about half of an energy bill when in use)—for much longer than they otherwise would need to.
Increases in electric rates from PA to ME
The two most heavily affected regions in the United States are New England and the Mid Atlantic, where electric rates in PA, NJ, CT, OH, MD, MA, NH and ME are expected to skyrocket over the next few years. Let’s take a look at more details about the short term energy rate outlook in these areas:
With energy rates soaring by over 11 percent in the past year, the energy industry in New England has been hit the hardest by the tumultuous energy market. State by state, these increases are very extreme. Massachusetts, for example, is projected to experience a 38 percent rate hike; Connecticut electric rates are expected to experience the lowest increase in the region despite the fact that the state will still carry some of the highest energy rates in the country. This is despite massive efforts by state governments to slow the growth rate of energy rates in the region.
Concerns about the natural gas supply in the region are greatly contributing to these increases.
The Mid Atlantic
With an 8 percent year over year increase in energy prices, the Mid Atlantic region is not far behind New England. For this region, energy prices are not increasing due to anything as complex as an issue with the distribution of natural gas. Electric rates in PA, NJ and NY are rising due to a reason that is much simpler than that: supply and demand; power use in the area so far this year has already greatly exceeded the forecasts for energy use made in 2013—and the HVAC driving hot weather has just begun.
These energy rate increases don’t have to be scary
Despite these increases in energy rates, savvy electric customers don’t have to worry. Many states have a competitive market thanks to fairly recent changes in the energy laws. For example, in PA, a power switch means that you will have the opportunity to browse dozens of power companies before making a change. These options mean that PA electric suppliers have to provide you with competitive offers that usually include lower rates to attract your business.
Regardless of your state, finding the lowest rate is easy thanks to organizations dedicated to helping you in this endeavor. Make the Switch USA, for example, allows you to compare the offerings of Power Companies in NJ, PA and CT. All you have to do is visit their website, MaketheSwitchUSA.com and enter basic information about your location and current energy rate.