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FACT SHEET: Climate Change Is Increasing Utility Costs

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Last Updated: 5/19/26

Higher global temperatures fuel extreme weather events, which in turn increase energy consumption and maintenance costs, threaten aging utility infrastructure, and create surges in energy demand. Increasingly severe extreme weather events are threatening electricity, water, and sewage systems and increasing the cost of these utilities for U.S. households. Between 2019 and 2025, the price of electricity in the U.S. increased by 29%. In 2025, electricity prices rose at more than twice the rate of overall inflation and were one of the fastest drivers of inflation, outpacing other basic expenses. 

EXTREME WEATHER AND HEAT EVENTS THREATEN ENERGY AND WATER SUPPLIES, RAISING UTILITY BILLS 

• Extreme weather events are damaging water and sewage systems and raising utility costs. Average water and sewage rates increased 5.1% between 2024 and 2025, twice the pace of inflation.
  • In 2024, Hurricane Helene caused approximately $3.7 billion in damage to western North Carolina’s water systems. In Asheville, Helene washed away 3,000 feet of pipes and cut off water access to more than 100,000 people. 
• Climate change-fueled extreme weather events that damage infrastructure, cause supply shocks, and increase energy demand have led to higher residential electricity prices: since 2010, residential electricity prices have increased by 66%. 
• Utilities across the country have raised energy prices after extreme weather events to recover from damages. Since 2020, 36 utilities have introduced at least one specific disaster-related charge across at least 18 states.
  • In Texas, Winter Storm Uri disrupted energy supply and demand, resulting in higher electricity prices in 2021. Prices for industrial and commercial customers more than doubled compared to the year prior. In February 2021, residential prices reached their highest price since July 2008. 
  • In Florida, Duke Energy implemented a $32 per month increase for one year starting in March 2025 to recover costs incurred from hurricanes Debby, Helene, and Milton. 
  • In Florida, Tampa Electric customers were subject to an 18-month payment plan to cover $464 million in restoration costs from Hurricanes Helene and Milton in 2024, an approximately $22 increase in the average customer’s monthly bill. 
  • In Florida, FPL Northwest Florida raised the cost of its “Storm Protection Plan Cost Recovery” charge by 2,589% since 2021 to support its $385 million storm protection plan to harden its grid. 
  • In Kentucky, Kentucky Power Co. increased customers’ bills by roughly 6% beginning in 2025 to help cover $78.8 million in “deferred storm costs” related to major storms that hit the state every year. 
  • In Oklahoma, Oklahoma Gas & Electric’s storm cost recovery rider, a triggered temporary raise in utility costs to help recover costs caused by storm damage, has increased by 460% since 2020. 
  • In California, Southern California Edison increased rates by approximately $17 per month in October 2025, in part to mitigate wildfire risk, after earlier raising rates to cover payments from a previous wildfire.
  • In Washington, Puget Sound Energy added a surcharge of about $14 per year to electricity customers to recover the costs from its Wildfire Mitigation and Response Plan. 
• Extreme weather events put stress on aging energy infrastructure, which wasn’t built to withstand our present-day climate. Energy production and distribution are vulnerable to flooding, hurricanes, drought, wildfires, and permafrost thaw. 

IN A WARMING CLIMATE, INCREASED COOLING DEMAND IS SPIKING ENERGY COSTS 

• Because of the warmer climate, Americans are using more electricity for air conditioning. If the nation’s climate warms by 1.8°F, the demand for cooling energy will increase by up to 20%. 
• The average summer electric bill for American households is expected to increase by 8.5% from 2025 ($717) to 2026 ($778), and 37.2% since 2020 ($568). 

WILDFIRES AND EXTREME WEATHER ARE INCREASING THE FREQUENCY OF POWER OUTAGES AND STRESSING THE GRID

• Climate change is increasing the frequency and severity of wildfires, which have threatened 9,200 miles of power lines across the country since 2000. 
• As climate change drives more extreme weather events, weather-related power outages are on the rise. From 2000 to 2023, 80% of power outages in the U.S. were due to weather. 
• Additional costs from power interruptions could range from $4.7 to $8.3 billion per year by 2090. 

SEA LEVEL RISE AND FLOODING THREATEN COASTAL UTILITY SYSTEMS 

• Local climate risks, such as drought and extreme weather events, are contributing to rising water and sewer bills. The combined water and sewer bill for a typical U.S. household has increased by 4.6% from 2023 to 2024. 
• Sea level rise and subsequent flooding events threaten coastal energy supply and disproportionately impact isolated and overburdened communities. 
• Flooding damages natural gas pipelines and buried powerlines, which are often buried to avoid damage from weather events. 

RISING UTILITY COSTS AND POWER OUTAGES DISPROPORTIONATELY IMPACT LOW-INCOME HOUSEHOLDS, OLDER PEOPLE, AND PEOPLE WITH DISABILITIES 

• Rising energy costs are pricing low-income families out of necessary cooling systems, putting low-income families at risk of heat-related illness.
  • An estimated 21 million U.S. households are behind in paying their energy bills. 
• Older people and individuals with disabilities or certain health conditions may be especially vulnerable during weather-related power outages.