Data Source: U.S. Energy Information Administration, Form 861 and Electric Power Month; Bureau of Economic Analysis.
Analysis by CEC Economics
Challenges
- California has some of the highest electricity costs per kWh—second-highest (jointly with Connecticut and Maryland) for residential customers ($0.30/kWh), second-highest for commercial customers ($0.24/kWh), and the fourth-highest for industrial customers ($0.19/kWh).119 Because of the high electricity costs per kWh, California finishes in the bottom half of the pack (37th place) in terms of electricity bill per capita, slipping 13 places from 2022 and a far cry from the sixth-place position it held pre-pandemic and the third-place position in 2016. Compared to Utah, which had the lowest per-capita residential electricity bill in 2023 ($84.97), California’s per-capita residential electricity bill was 70% higher—a significant spike compared to 2017, when California’s per-capita electricity bill was only 19% higher than Utah’s.
- The state of California can no longer depend solely on mild weather and energy efficiency measures to mitigate the impact of high utility bills. A recent report by the Legislative Analyst’s Office assessing California’s residential electricity rates found that some of the key drivers of the high rates include significant and increasing wildfire‑related costs, climate programs and policies, and differences in utility operational structures and services territories.120 A recent Next 10 report found that the wildfire-related portion of the average customer’s bill for three investor-owned utilities ranged from 7.1% to 12.8% in 2023.121
119 Contrary to popular but misleading claims, high renewable energy generation is not the reason for California’s high retail electricity rates. Rather, wildfire costs and associated risks have significantly increased rates in California. As the investor-owned utilities invest in the grid and vegetation management to reduce wildfire risks and insurance costs, these costs have ballooned and account for 16 percent of the total cost to customers. See Brendan Pierpont, “Clean Energy Isn’t Driving Power Price Spikes,” July 2024. Energy Innovation. Retrieved from: https://energyinnovation.org/wp-content/uploads/Clean-Energy-Isnt-Driving-Power-Price-Spikes.pdf
120 “Assessing California’s Climate Policies—Residential Electricity Rates in California.” Legislative Analyst’s Office. January 7, 2025. Available at: https://lao.ca.gov/Publications/Report/4950
121 “Costs of Climate Change: Financial and Economic Impacts on California and U.S. Households.” Next 10 and CLEE. September 25, 2025. Available at: https://www.next10.org/sites/default/files/2025-09/CLEE_Costs%20of%20Climate%20Change_2025.pdf
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