Aug 31, 2025
Upstate New Yorkers are facing a sharp rise in energy costs after the Public Service Commission (PSC) approved a multi-year plan to upgrade its electric and gas systems.
National Grid, the region’s largest electric and gas utility serving 1.6 million households from Albany to Buffalo, will raise energy rates over the next three years, resulting in $600 in extra costs for the average household compared to today's rates — and it’s part of a broader trend of rising electricity prices nationwide.
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How will these price increases work, and why are utility costs rising in the first place? We dug into the numbers.
A 31% jump in electric rates, and higher gas costs
National Grid customers will see prices rise over the next three years, with a 10% increase rolling out immediately, and more increases coming in the following two years. Under the PSC’s three-year plan, electric delivery charges will climb 31% while natural gas delivery fees will increase 40%.
For the average household, that means an extra $264 in the first year alone. Currently, an average National Grid customer pays about $2,600 per year for combined electricity and gas.
National Grid says the increases are necessary to meet increasing energy demands as well as modernize aging infrastructure and maintain safe and reliable service. The company states that it plans to spend $4 billion on the upgrades, which includes hiring 480 new employees, and investing $1.4 billion in upgrading its electric network and $351 million into gas systems in the first year.
Despite a unanimous vote for the project, not everyone is on board. Consumer advocates like lawyer Theresa Hotte of the Public Utility Law Project warn the hikes will be “devastating for households already living on the edge.”
The new plan sets aside more than $290 million in bill discounts for income-eligible households across Upstate New York, including about $72 million in the first year alone. While this money is designed to give struggling families more breathing room, more than 225,000 National Grid customers are already at least two months behind on payments, with total arrears exceeding $362 million.
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Why energy prices are rising nationwide
Upstate New York’s hikes are part of a larger story: electricity prices are climbing across the U.S. The U.S. Energy Information Administration reports the average U.S. monthly residential electric bill rose to $144 in 2024, up from $122 in 2021.
There are several factors behind these higher costs:
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- Aging infrastructure: Utilities across the country are pouring billions into upgrading transmission lines and equipment.
- Soaring demand: The explosion of AI-driven data centers and electric vehicle adoption is straining the grid.
- Inflation and supply chains: Rising costs for transformers, cables and other equipment are still rippling through the system.
- Policy shifts: Recent legislative changes, including the rollback of clean energy tax credits, may slow the growth of cheaper renewable options.
Industry experts warn that unless investment in renewables ramps back up, consumers could face even higher bills in the coming years.
Political pressure ramps up amidst high energy bills
During his 2024 campaign, President Donald Trump promised to slash energy bills in half within 18 months. But so far, electricity prices have climbed 5.5% over the last year, outpacing general inflation. And Democrats are attacking Republicans for failing to deliver relief.
Experts say these policy shifts could push solar and wind projects out of reach for many states, slowing innovation and keeping prices elevated.
“Phasing out credits that have already supported clean and cheap electricity generation will raise customer utility bills,” wrote Elea Castiglione, a fellow at the Kleinman Center for Energy Policy to The Washington Post.
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What consumers can expect next
In Upstate New York, options are limited. Prices will be going up, and the relief set aside for low-income housing will still leave many customers feeling the squeeze.
Nationwide, the outlook isn’t much brighter. Without significant investment in renewable energy and grid modernization, analysts say average monthly bills could keep rising well into the next decade.
For households already struggling with rent, groceries, and other essentials, higher electricity prices are becoming a flashpoint in both wallets and politics — and the fight over who’s to blame is just beginning.
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Monique Danao is a highly experienced journalist, editor and copywriter with 8 years of expertise in finance and technology. Her work has been featured in leading publications such as Forbes, Decential, 99Designs, Fast Capital 360, Social Media Today and the South China Morning Post.
