Energy is what keeps us, our technology and our economies moving. Scientists and engineers are constantly looking for new, more efficient ways to create and sustain energy. Despite the recent advances in natural gas cultivation and the small strides that have been made in renewables, electricity costs are still on the rise. Business Insider explains why despite technological advances, costs aren’t going down:
Electricity prices are forecast to rise slightly this summer. But any increase is noteworthy because natural gas, which is used to produce nearly a third of the country’s power, is 43 percent cheaper than a year ago. A long-term downward trend in power prices could be starting to reverse, analysts say.
The recent heat wave that gripped much of the country increased demand for power as families cranked up their air conditioners. And that may boost some June utility bills. But the nationwide rise in electricity prices is attributable to other factors, analysts say
- In many states, retail electricity rates are set by regulators every few years. As a result, lower power costs haven’t yet made their way to customers.
- Utilities often lock in their costs for natural gas and other fuels years in advance. That helps protect customers when fuel prices spike, but it prevents customers from reaping the benefits of a price drop.
- The cost of actually delivering electricity, which accounts for 40 percent of a customer’s bill on average, has been rising fast. That has eaten up any potential savings from the production of electricity.
Utilities are building transmission lines, installing new equipment and fixing up power plants after what analysts say has been years of under-investment.