The Real Reason Your Electric Bill Keeps Going Up

If you’ve opened your electric bill lately and felt a shock that had nothing to do with static electricity, you’re not alone. Across Pennsylvania, electric bills have been steadily climbing — and most consumers think they know why. Many assume rising bills are tied to generation costs, the price of the electricity itself. But that’s not what’s happening.

In fact, generation prices — the part of your bill that reflects the cost of producing electricity — have been remarkably stable over time. That’s thanks to Pennsylvania’s competitive energy market, which allows consumers to shop for their electricity supplier and keeps generation prices in check. Since electric choice was introduced more than two decades ago, the competition among suppliers has worked as intended: stabilizing costs and giving consumers options.

In fact, Pennsylvanians who have taken advantage of the state’s competitive energy market are paying roughly the same for electricity in 2024 as they did in 1996. Moreover, according to a national report, consumers in 14 competitive states and jurisdictions saved an estimated $530.6 billion between 2008 and 2024, compared to the pricing trends in monopoly states.

So, if generation isn’t to blame, what is? The answer lies in the parts of your bill you can’t control — the monopoly charges for transmission and distribution. These are the costs utilities impose for delivering electricity through their poles, wires, and infrastructure, as well as for various public policy programs they’re required to fund. These charges are set by utilities and approved by state regulators, not determined by market competition. And they’re the fastest-growing part of your electric bill.

Over the past decade, while energy and capacity costs have remained relatively flat, transmission and distribution charges have risen sharply. Most utilities have increased distribution costs by up to 25%. Transmission costs are up as much as 266%. Utilities have invested heavily in infrastructure projects and modernization initiatives — expenses that are ultimately passed along to ratepayers. Add in the costs of government-mandated programs, and you have a recipe for steadily increasing bills, regardless of how carefully you shop for your supplier.

Pennsylvanians have the power to choose who supplies their electricity, but no say in how much they pay to get that power delivered. Without changes in how these monopoly costs are reviewed and managed, consumers will continue to see their bills rise for reasons entirely outside their control.