The average residential electricity rate in the United States is 16.8 cents per kWh in 2026, but rates vary by more than 4x across states — from 10.5 cents/kWh in Idaho to 42.1 cents/kWh in Hawaii. Your electricity rate is the single most important number for calculating the cost of running your HVAC system, and it determines whether upgrades like heat pumps and solar panels make financial sense.
Below you'll find every state ranked from cheapest to most expensive, with analysis of what drives rate differences and how they impact your heating and cooling costs.
2026 Electricity Rates: All 50 States Ranked
Cheapest States (Ranks 1-25)
| Rank | State | Rate (cents/kWh) | vs. National Avg | Cost of 886 kWh/mo |
|---|---|---|---|---|
| 1 | Idaho | 10.5 | -37% | $93 |
| 2 | Washington | 10.8 | -36% | $96 |
| 3 | Utah | 11.2 | -33% | $99 |
| 4 | Wyoming | 11.5 | -32% | $102 |
| 5 | North Dakota | 11.6 | -31% | $103 |
| 6 | Nebraska | 12.0 | -29% | $106 |
| 7 | Oregon | 12.0 | -29% | $106 |
| 8 | Louisiana | 12.1 | -28% | $107 |
| 9 | Montana | 12.2 | -27% | $108 |
| 10 | Kentucky | 12.3 | -27% | $109 |
| 11 | Oklahoma | 12.4 | -26% | $110 |
| 12 | Arkansas | 12.5 | -26% | $111 |
| 13 | Missouri | 12.7 | -24% | $113 |
| 14 | South Dakota | 12.8 | -24% | $113 |
| 15 | Tennessee | 12.8 | -24% | $113 |
| 16 | West Virginia | 12.9 | -23% | $114 |
| 17 | Nevada | 13.1 | -22% | $116 |
| 18 | North Carolina | 13.1 | -22% | $116 |
| 19 | Kansas | 13.8 | -18% | $122 |
| 20 | Mississippi | 13.8 | -18% | $122 |
| 21 | Iowa | 14.0 | -17% | $124 |
| 22 | Virginia | 14.0 | -17% | $124 |
| 23 | Colorado | 14.1 | -16% | $125 |
| 24 | Georgia | 14.2 | -15% | $126 |
| 25 | Texas | 14.2 | -15% | $126 |
Most Expensive States (Ranks 26-50)
| Rank | State | Rate (cents/kWh) | vs. National Avg | Cost of 886 kWh/mo |
|---|---|---|---|---|
| 26 | Arizona | 14.3 | -15% | $127 |
| 27 | New Mexico | 14.3 | -15% | $127 |
| 28 | Minnesota | 14.5 | -14% | $129 |
| 29 | South Carolina | 14.5 | -14% | $129 |
| 30 | Ohio | 14.6 | -13% | $129 |
| 31 | Alabama | 14.7 | -13% | $130 |
| 32 | Indiana | 14.8 | -12% | $131 |
| 33 | Delaware | 15.2 | -10% | $135 |
| 34 | Illinois | 15.4 | -8% | $136 |
| 35 | Florida | 15.5 | -8% | $137 |
| 36 | Wisconsin | 16.1 | -4% | $143 |
| 37 | Maryland | 16.2 | -4% | $144 |
| 38 | Pennsylvania | 17.5 | +4% | $155 |
| 39 | Michigan | 18.4 | +10% | $163 |
| 40 | New Jersey | 18.8 | +12% | $167 |
| 41 | Vermont | 21.4 | +27% | $190 |
| 42 | New York | 22.5 | +34% | $199 |
| 43 | Alaska | 24.2 | +44% | $214 |
| 44 | Maine | 24.8 | +48% | $220 |
| 45 | California | 27.6 | +64% | $245 |
| 46 | New Hampshire | 27.1 | +61% | $240 |
| 47 | Rhode Island | 27.8 | +65% | $246 |
| 48 | Massachusetts | 28.6 | +70% | $253 |
| 49 | Connecticut | 29.9 | +78% | $265 |
| 50 | Hawaii | 42.1 | +151% | $373 |
*886 kWh is the average US monthly household consumption.
These rates represent averages across all residential customers and utilities in each state. Your specific rate depends on your utility company, rate plan, and usage level. States with deregulated markets (Texas, Ohio, Pennsylvania, and others) may have widely varying rates from different suppliers.
Why Electricity Rates Vary So Much
The 4x difference between the cheapest and most expensive states comes down to five primary factors.
1. Generation Fuel Mix
The source of electricity is the biggest cost driver. States with abundant, cheap fuel sources enjoy lower rates.
| Fuel Source | Typical Generation Cost | States Where Dominant |
|---|---|---|
| Hydroelectric | 1-3 cents/kWh | WA, OR, ID — explains cheapest rates |
| Coal (existing plants) | 3-5 cents/kWh | WY, WV, KY, ND |
| Natural Gas (combined cycle) | 4-6 cents/kWh | TX, LA, OK, PA |
| Nuclear | 3-5 cents/kWh | IL, SC, NH |
| Wind | 2-4 cents/kWh | IA, KS, OK, TX |
| Solar Utility-Scale | 3-5 cents/kWh | CA, AZ, NV, TX |
| Oil / Diesel | 15-25 cents/kWh | HI — explains highest rates |
| Offshore Wind | 8-12 cents/kWh | MA, RI, CT (emerging) |
Washington, Oregon, and Idaho benefit from massive hydroelectric capacity from the Columbia River system — the cheapest form of electricity generation. Hawaii, conversely, generates most of its electricity from imported oil, explaining its sky-high rates.
2. Transmission and Distribution Infrastructure
Moving electricity from power plants to your home costs money. States with older infrastructure or challenging geography (mountainous terrain, remote populations) face higher delivery costs. Grid modernization investments — replacing aging transformers, burying power lines, hardening against storms — are adding 2-4 cents/kWh in many states.
3. Regulatory Environment
States with deregulated electricity markets (where you can choose your supplier) sometimes have lower generation costs but not always. Regulated states (where one utility handles everything) provide more rate stability but can pass infrastructure costs directly to ratepayers.
| Market Type | How It Works | Examples |
|---|---|---|
| Fully Regulated | One utility, rate set by state PUC | FL, GA, NC, CO |
| Deregulated (Customer Choice) | Choose your generator; utility delivers | TX, OH, PA, NJ, CT |
| Hybrid | Some customer choice, partial regulation | CA, NY, IL, MI |
4. State Policies and Mandates
Renewable Portfolio Standards (RPS), clean energy mandates, and carbon pricing programs add costs in some states while reducing long-term fuel exposure. States like California and Massachusetts have aggressive clean energy targets that increase near-term rates but reduce fossil fuel price volatility.
5. Climate and Demand Patterns
States with extreme peak demand (hot summers requiring massive AC loads) must build and maintain enough generation capacity for those peaks. This capacity sits idle much of the year but still costs money.
How Electricity Rates Impact HVAC Costs
Your electricity rate directly determines how much you spend on cooling and electric heating. Here's what the same HVAC workload costs across different rate levels.
Annual Cooling Cost by Rate (3-Ton AC, 2,000 sq ft Home)
| SEER Rating | 10.5 cents (ID) | 14.2 cents (TX) | 16.8 cents (Avg) | 27.6 cents (CA) | 42.1 cents (HI) |
|---|---|---|---|---|---|
| 14 SEER | $378 | $511 | $605 | $994 | $1,516 |
| 16 SEER2 | $331 | $447 | $529 | $869 | $1,326 |
| 20 SEER2 | $265 | $358 | $423 | $695 | $1,061 |
| 24 SEER2 | $221 | $298 | $353 | $579 | $884 |
The table reveals a critical insight: upgrading HVAC efficiency matters more in high-rate states. Going from 14 SEER to 20 SEER2 saves $113/year in Idaho but $455/year in California. This dramatically changes the payback calculation for new equipment.
Annual Heat Pump Heating Cost by Rate
| HSPF2 | 10.5 cents (ID) | 14.2 cents (TX) | 16.8 cents (Avg) | 27.6 cents (CA) | 42.1 cents (HI) |
|---|---|---|---|---|---|
| 7.5 HSPF2 | $840 | $1,136 | $1,344 | $2,208 | $3,368 |
| 8.5 HSPF2 | $741 | $1,002 | $1,186 | $1,948 | $2,972 |
| 10 HSPF2 | $630 | $852 | $1,008 | $1,656 | $2,526 |
| 12 HSPF2 | $525 | $710 | $840 | $1,380 | $2,105 |
Rate Trends: Where Are Prices Heading?
National Rate Trajectory (2020-2026)
| Year | Avg Residential Rate | Year-Over-Year Change |
|---|---|---|
| 2020 | 13.2 cents/kWh | +0.8% |
| 2021 | 13.7 cents/kWh | +3.8% |
| 2022 | 15.1 cents/kWh | +10.2% |
| 2023 | 15.9 cents/kWh | +5.3% |
| 2024 | 16.1 cents/kWh | +1.3% |
| 2026 | 16.5 cents/kWh | +2.5% |
| 2026 | 16.8 cents/kWh | +1.8% |
After the sharp spike in 2022 (driven by natural gas price surges and inflation), rate increases have moderated. The EIA projects continued gradual increases of 1.5-2.5% annually through the late 2020s, with significant regional variation.
States With the Fastest-Rising Rates
| State | 2022 Rate | 2026 Rate | 4-Year Change | Primary Driver |
|---|---|---|---|---|
| Maine | 18.6 | 24.8 | +33% | Offshore wind contracts, grid upgrades |
| Connecticut | 24.5 | 29.9 | +22% | Grid hardening, clean energy mandates |
| California | 23.0 | 27.6 | +20% | Wildfire mitigation, solar integration |
| Michigan | 15.9 | 18.4 | +16% | Grid modernization, coal plant closures |
| Indiana | 13.0 | 14.8 | +14% | Coal-to-gas transition costs |
States With the Most Stable Rates
| State | 2022 Rate | 2026 Rate | 4-Year Change | Why Stable |
|---|---|---|---|---|
| Washington | 10.3 | 10.8 | +5% | Abundant, low-cost hydropower |
| Idaho | 10.1 | 10.5 | +4% | Hydropower + stable federal power contracts |
| Tennessee | 12.0 | 12.8 | +7% | TVA system provides rate stability |
| Nebraska | 11.4 | 12.0 | +5% | Public power (no profit motive) |
| Oregon | 11.5 | 12.0 | +4% | Hydropower dominance |
Real-World Impact Examples
Example 1: Identical Homes in Idaho vs. Connecticut
Same 2,000 sq ft home, same 16 SEER2 heat pump, same usage patterns.
| Category | Idaho (10.5 cents) | Connecticut (29.9 cents) | Difference |
|---|---|---|---|
| Annual Cooling | $331 | $943 | $612 |
| Annual Heating (heat pump) | $741 | $2,111 | $1,370 |
| Water Heating (HPWH) | $84 | $238 | $154 |
| Other Electric | $630 | $1,794 | $1,164 |
| Total Electric | $1,786 | $5,086 | $3,300 |
The Connecticut homeowner pays almost 3x more for the same comfort level. This explains why Connecticut residents are far more motivated to invest in efficiency upgrades, solar panels, and electrification — the payback is dramatically faster.
Example 2: When to Choose Gas vs. Electric Heating
The electricity-to-gas rate ratio determines which fuel is cheaper for heating.
| State | Electric Rate | Gas Rate | Ratio | Cheaper Heating Fuel |
|---|---|---|---|---|
| Washington | 10.8 cents | $1.40/therm | 2.6:1 | Heat pump (any COP > 2.6) |
| Georgia | 14.2 cents | $1.15/therm | 4.2:1 | Gas furnace OR heat pump COP > 4.2 |
| Massachusetts | 28.6 cents | $1.75/therm | 5.6:1 | Gas furnace (heat pump needs COP > 5.6) |
| Connecticut | 29.9 cents | $1.90/therm | 5.3:1 | Gas furnace (heat pump needs COP > 5.3) |
The breakeven rule: If your electricity rate in cents/kWh divided by your gas rate in $/therm is less than 3.4, a standard heat pump (COP 3.0-3.4) will be cheaper than a gas furnace. If the ratio is above 3.4, you need a high-efficiency heat pump or gas remains cheaper. In states like Washington and Idaho, heat pumps win easily. In states like Massachusetts, gas furnaces still have an edge unless you have a top-tier cold-climate heat pump.
Example 3: Solar Panel Payback by State
Your electricity rate determines how fast solar panels pay for themselves.
| State | Rate (cents/kWh) | Annual Solar Savings (6kW) | Payback (After 30% Credit) |
|---|---|---|---|
| Hawaii | 42.1 | $3,159 | 3.0 years |
| Connecticut | 29.9 | $1,854 | 5.1 years |
| California | 27.6 | $2,070 | 4.6 years |
| US Average | 16.8 | $1,176 | 8.1 years |
| Texas | 14.2 | $1,207 | 7.9 years |
| Idaho | 10.5 | $735 | 12.9 years |
Solar payback ranges from 3 years in Hawaii to nearly 13 years in Idaho. In high-rate states, solar is among the best investments you can make.
Example 4: EV Charging Cost Comparison
| State | Rate (cents/kWh) | Cost per 100 Miles (EV) | Cost per 100 Miles (Gas, 30 MPG) | EV Savings |
|---|---|---|---|---|
| Washington | 10.8 | $3.24 | $12.00 | 73% |
| Texas | 14.2 | $4.26 | $10.50 | 59% |
| California | 27.6 | $8.28 | $15.00 | 45% |
| Connecticut | 29.9 | $8.97 | $11.67 | 23% |
| Hawaii | 42.1 | $12.63 | $16.00 | 21% |
EVs save money in every state, but the savings are most dramatic in low-rate states and least impressive in high-rate states where gasoline is also expensive.
How to Find Your Exact Rate
Your state average is a starting point, but your actual rate may differ significantly. Here's how to find your precise cost per kWh.
Method 1: Check your bill. Look for "Energy Charge," "Generation Charge," or "Price per kWh." Add up all per-kWh charges (generation + transmission + distribution) for your all-in rate. Ignore fixed monthly fees.
Method 2: Calculate from your bill. Divide your total bill (minus fixed fees) by total kWh consumed. This gives your effective all-in rate.
Method 3: Utility website. Most utilities publish their rate schedules online. Search for "[your utility name] residential rate schedule."
Method 4: EIA data. The EIA publishes utility-level average rates at eia.gov/electricity/data/browser. Select your state and utility to see the most recent data.
If you're in a deregulated state and haven't actively chosen an electricity supplier, you may be on a "default service" or "price to compare" rate that's higher than competitive market offers. In states like Texas, Pennsylvania, and Ohio, shopping for a new supplier can save 10-20% with no service interruption.
Deregulated vs. Regulated States
Deregulated States (Customer Choice Available)
In these states, you can shop for your electricity supplier. The distribution utility (which maintains poles, wires, and meters) remains the same, but you choose who generates your electricity.
| State | Market Type | Shopping Available? | Typical Savings Opportunity |
|---|---|---|---|
| Texas | Full deregulation | Yes (most areas) | 10-25% |
| Pennsylvania | Full deregulation | Yes | 5-15% |
| Ohio | Full deregulation | Yes | 5-15% |
| New Jersey | Full deregulation | Yes | 5-10% |
| Connecticut | Full deregulation | Yes | 5-15% |
| Illinois | Full deregulation | Yes | 5-10% |
| Maryland | Full deregulation | Yes | 5-10% |
| New York | Partial deregulation | Yes (varies by region) | 5-15% |
| Michigan | Partial deregulation | Limited (10% cap) | 3-8% |
| California | Partial (CCA available) | Community Choice available | 3-10% |
Key Takeaways:
- US average residential rate is 16.8 cents/kWh in 2026
- Cheapest: Idaho (10.5 cents), Washington (10.8 cents), Utah (11.2 cents)
- Most expensive: Hawaii (42.1 cents), Connecticut (29.9 cents), Massachusetts (28.6 cents)
- Hydropower states enjoy the lowest, most stable rates
- Your rate determines the ROI of every efficiency upgrade — high-rate states see faster payback
- In deregulated states, shopping for a supplier can save 5-25%
- Rate increases have moderated to 1.5-2.5% annually after the 2022 spike
- Use your actual bill rate (not state average) for accurate cost calculations
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