American consumers are facing historically high electricity prices, according to recent data on 2025 prices compiled and analyzed by the U.S. Chamber of Commerce. Electricity costs have risen 22 percent over the past five years, straining household budgets nationwide. While rapid growth in data centers and manufacturing has increased electricity demand, the state data shows that this increased demand does not equate to higher prices, rather individual policy and access to infrastructure are the driving forces behind price disparities.
In fact, states with the largest concentrations of data centers, such as Virginia, Texas, and North Carolina, maintain electricity rates well below the national average. In contrast, consumers paying the most tend to live in the Northeast or along the West Coast, where states have ambitious climate proposals or block access to natural gas infrastructure.
The new data sends a clear message: if states want to lower costs for their residents, they need to focus on shifting their own restrictive policies and fixing their permitting delays, rather than blaming increases in demand.
Natural Gas Access Is Critical
The Chamber’s analysis reinforces a clear trend that access to natural gas remains one of the most important determinants of electricity affordability. As the largest source of American power generation, natural gas provides both reliability and cost stability. States with abundant shale resources, like Pennsylvania and Ohio, have experienced comparatively modest electricity price increases, thanks in large part to production from the Marcellus and Utica formations. North Dakota, another state with abundant local energy resources, even posted a slight decrease in electricity costs. These states have the correct approach: continued investment in natural gas and utilization of local resources is necessary to meet increasing demand and fuel AI growth.
In sharp contrast, regions that lack sufficient pipeline infrastructure face significantly higher costs, even when they sit geographically close to these natural resources. In New England, transportation bottlenecks and delayed infrastructure project permitting have tightened supply and driven prices upward. In Maine, for example, average electricity prices reached 22.81 cents per kilowatt hour in 2025, a 62 percent increase over five years.
2025 Average U.S. Electricity Prices, Source: U.S. Chamber of Commerce
Renewables Mandates Drive Up Prices
At the same time, states that restrict their energy mix with renewable mandates rather than tap into abundant resources consistently see the highest electricity prices. California, New York, and New England face some of the highest costs in the country due to aggressive climate mandates that accelerate power plant retirements and limit dispatchable generation. For example, both California and Rhode Island have seen electricity prices climb 40 percent over five years. In California, declining refinery capacity and reliance on energy imports have driven both gasoline and electricity prices to untenable heights, further exacerbating the state’s affordability crisis, as EID has repeatedly highlighted
Policies like carbon pricing and heavy reliance on intermittent sources such as wind and solar introduce additional cost burdens on consumers that otherwise could be mitigated by pro-growth policies and streamlined permitting – if states are willing to take the right steps.
Energy Scarcity Is a Policy Choice
The evidence points to a straightforward conclusion: electricity prices are rising not because demand is growing, but because policy and permitting barriers are preventing supply from keeping up. Expanding natural gas infrastructure and streamlining permitting processes would relieve bottlenecks, stabilize prices, and improve grid reliability. As Heath Knakmuhs, Vice President and Policy Counsel at the Global Energy Institute at the U.S. Chamber explains:
“Going forward, policymakers need to get serious about building critical infrastructure (transmission lines, pipelines, and generation plants) and cutting through the permitting red tape that stalls progress on all types of projects. A balanced energy mix that includes renewables, natural gas, nuclear, and other resources isn’t just good policy; it’s the only realistic path to keeping electricity both clean and affordable.”
Without these reforms, costs in states with extreme climate policies will only continue to rise, and the only bogeyman to blame will be their state-level policies.
Bottom Line: Without meaningful permitting reform and expanded energy infrastructure, electricity prices for American consumers will continue to climb. Meeting future demand, including from data centers, depends on unlocking affordable and reliable supply, with natural gas continuing to be the leading solution.
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