States have tools to lower soaring electricity bills, experts say

President Trump and Democratic and Republican governors this month announced a plan to build power plants to lower electricity bills in 13 Eastern states and the District of Columbia, but energy experts say those plants would take years to build and that states, legislatures and utility regulators have quicker tools to keep prices from rising or even to lower them.

Electricity prices have jumped recently because demand is rising from residents, businesses and data centers used for artificial intelligence, the national average retail rate was 5 percent higher in November from a year earlier and the average household spent $178 a month for 1,000 kilowatt-hours, according to the Energy Information Administration.

Very cold weather and winter storms have pushed up wholesale electricity and natural gas prices — costs utilities are expected to pass on — and about 17 percent of Americans are behind on electric bills, the National Energy Assistance Directors Association said. "The anger is growing," said Mark Wolfe of that association.

One set of proposals would reduce or reform how utilities earn profits. Most U.S. electric utilities are monopolies and states typically allow returns of about 10 to 12 percent on invested money; critics say that rate-of-return model encourages excessive spending. "There’s a natural mismatch of incentives," said Mark Dyson of RMI.

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