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Watts Happening?
Please find below our latest issue of Watts Happening?, a market update highlighting key developments across power markets. Our analysis is based on public data and reflects our current views.
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Market Update: Retail Power Prices Are Rising and Households Are Paying the Price
Power prices are climbing nationwide, and residential customers are bearing the brunt of the increase.
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By the Numbers (Over the Past Three Years):
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- 43 of 49: US markets with higher residential prices
- 41 of 49: US markets where the residential premium increased
- 13 of 14: PJM states with higher residential prices
- Residential Rate +30%: Illinois residential rate increase (+40% increase in premium for residential vs. industrial power prices)
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Power prices are up across the board, but homes are taking the biggest hit — and state officials are taking notice.
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- National Trend (Widespread Retail Rate Surges): Over the past three years, residential electricity rates rose across nearly every contiguous US market, with D.C., New Jersey, Massachusetts, Vermont, and Illinois recording the sharpest absolute increases.
- PJM Footprint: 13 of 14 PJM states recorded both higher residential prices and a wider rate gap between households and industrial users.
- Illinois Outlier: Illinois costs surged past national averages. Residential rates jumped from 16.3¢/kWh (July 2023) to 21.2¢/kWh (July 2026) — a 30.1% increase.
In response, lawmakers in Illinois and across the country are drafting policies to protect households from power inflation and expand local supply.
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Households vs. Industry: The Gap Is Widening
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This is not a case of industrial power prices dropping.
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Nationally, both residential and industrial prices rose by roughly 15%. However, in absolute terms, the residential hike was more than double:
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- Residential Increase: +2.29¢/kWh
- Industrial Increase: +1.04¢/kWh
Across the Lower 48 and D.C., the household premium over industrial rates climbed 14.7%, moving from 8.54¢/kWh (May 2023) to 9.79¢/kWh (May 2026).
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How Battery Storage Helps
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Batteries absorb cheap, abundant power during low-demand periods and discharge it back to the grid when demand peaks. This simple function relieves grid strain, improves reliability, and lowers long-term electricity costs for everyone.
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