Investor-owned utilities charge 23% more for electricity than public providers

Your electricity bill from an investor-owned utility is now 23% higher than from a public provider, and this gap is growing.

In 2025, homes paid an average of 17.8 cents per kilowatt-hour (kWh) to investor-owned utilities, a 23% premium over the 14.5 cents charged by public utilities and 14.1 cents by co-ops. This price gap has widened significantly since 2020, with investor-owned utility prices increasing by 34% compared to a 19% rise for public utilities and co-ops, all while inflation rose by 24%. The data, sourced from the EIA annual survey of utilities (Form 861), covers homes buying supply and delivery from their utility, excluding those who buy from a retail supplier. Investor-owned utilities earn returns for shareholders on infrastructure investments, a model absent in public utilities and co-ops. The study indicates that investor-owned prices rose faster than nonprofit prices in 38 out of 48 states between 2020 and 2025, with the most significant increases occurring during the energy price spike from 2020 to 2023.

The widening price disparity between investor-owned and public utilities suggests a growing cost burden for customers of for-profit energy providers. This trend highlights the financial advantages of public and cooperative utility models, which do not face shareholder return requirements. The data indicates that the gap widened most dramatically during recent energy price spikes, suggesting that investor-owned utilities may be less resilient or more prone to rapid price increases during market volatility. Future energy policy discussions will likely focus on this cost differential, potentially leading to greater scrutiny of investor-owned utility rate structures and operational efficiencies.

Consumers who rely on investor-owned utilities are paying a tangible premium, impacting household budgets and potentially influencing decisions about energy consumption and conservation. The higher rates charged by investor-owned utilities could also affect the competitiveness of businesses operating within their service territories. As energy costs continue to be a significant household expense, the sustained difference in pricing between utility models warrants attention from both regulators and consumers advocating for more equitable energy pricing.