Renewable energy, coal, and natural gas prices are pushing residential electricity prices higher in 2011 despite faltering economy.
Monthly estimates from the U.S. Energy Information Administration show that prices of U.S. residential electricity from January to March were up 3.31 percent year on year, to 11.24¢ per kilowatt hour. Based on fuel cost increases last year, EIA expects that by the end of 2011, average annual residential prices will have risen 2.9 percent over 2010, to 11.91¢ per kilowatt hour. The growth is expected to slow to 0.6 percent in 2012.
“We would like to see lower electricity prices and lower energy prices overall. It makes the economy function more efficiently,” says Daniel Simmons, director of state and regulatory affairs at the Institute for Energy Research, a Washington (D.C.) organization that supports free markets.
The average residential price of electricity in South Carolina rose about 9.76 percent year on year in the first three months of 2011, yet the increase has been most dramatic in Tennessee, where average prices climbed 15.28 percent in the same period, to 9.58¢ per kilowatt hour, EIA estimates.
While the average price in Tennessee, 9.58¢ per kilowatt hour, is below the national average of 11.24¢, bills are high as the state is one of the biggest per-capita users of electricity. Average monthly residential consumption, at 1,248 kilowatt hours per housing unit, was the second-highest in the country after Louisiana, according to EIA data from its 2009 survey, the most recent available.
Tennesseans’ average monthly electricity bill, $116.35 in 2009, was twelfth-highest in the U.S. (the national average was $104.52).
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Source: Venessa Wong | Bloomberg Businessweek