The State-by-State Spread

EIA data shows residential electricity prices vary dramatically:

Most expensive (cents per kWh):

  • Hawaii: 35-40¢
  • Connecticut: 26-30¢
  • Massachusetts: 25-29¢
  • Rhode Island: 24-28¢
  • California: 24-32¢
  • New Hampshire: 23-27¢

Least expensive:

  • Louisiana: 10-12¢
  • Oklahoma: 10-12¢
  • Utah: 10-12¢
  • Idaho: 10-11¢
  • Washington: 10-11¢
  • Wyoming: 10-12¢

The spread from cheapest to most expensive is roughly 3x. For a home using 900 kWh/month, that’s the difference between $100/month and $300/month in electricity alone.

What Drives the Variation

Fuel Sources

States relying on natural gas and coal for generation typically have lower rates. States dependent on imported fuel (Hawaii), or with heavy renewable mandates that required new infrastructure (Connecticut, Massachusetts), tend to have higher rates.

Grid Infrastructure

Older, denser grids in the Northeast cost more to maintain per customer. Western states with newer infrastructure and hydroelectric (Washington, Oregon, Idaho) benefit from lower-cost generation and distribution.

Regulatory Environment

Regulated utility markets (most of the Southeast) tend to have more stable, moderate pricing. Deregulated markets (Texas, parts of the Northeast) can offer lower rates but with more volatility and complex plan structures.

Climate Load

Hot states use more electricity for cooling; cold states may use natural gas, propane, or heating oil for heating. A home in Phoenix uses 2-3x more electricity than a comparable home in San Francisco, even if the per-kWh rate is lower.

Total Energy Cost: Beyond Electricity

Electricity is just one component. Total home energy includes:

  • Natural gas: Heating, water heating, cooking — $50-$150/month in cold climates
  • Heating oil: $200-$400/month during winter in Northeast (declining usage)
  • Propane: $100-$250/month for rural homes without gas lines
  • Wood/pellets: $100-$200/month for supplemental heating

A home in Minnesota may have cheap electricity (13¢/kWh) but spend $200/month on natural gas heating for 6 months, making total energy costs comparable to a warm-climate state.

Energy Efficiency and Your Budget

The most impactful energy savings come from:

  1. Air sealing and insulation: $2,000-$5,000 to address. Saves 15-25% on heating/cooling.
  2. HVAC efficiency: Upgrading from SEER 10 to SEER 16 cuts cooling costs nearly in half.
  3. LED lighting: Already standard in most homes. $100-$300 to convert older fixtures.
  4. Smart thermostat: $100-$300. Saves 8-15% on heating/cooling.
  5. Energy Star appliances: 10-50% less energy than standard models.

Solar Payback

Residential solar makes economic sense where:

  • Electricity costs exceed 15¢/kWh
  • Net metering is available (credits at retail rate)
  • Annual sunlight exceeds 4.5 peak sun hours
  • Incentives (federal 30% ITC + state/utility rebates) are available

In favorable markets (CA, AZ, TX, FL, NC), solar payback runs 5-8 years with a 20-25 year system life. In less favorable markets (Pacific NW, northern states with low rates), payback exceeds 12-15 years.

How to Estimate Your Energy Budget

Before buying in a new state:

  1. Check the EIA residential electricity rate (shown on every HomeStats state page)
  2. Estimate monthly usage: 900 kWh is average, but hot/cold climate homes may use 1,200-2,000 kWh
  3. Add natural gas costs if applicable ($50-$150/month)
  4. Factor in climate: extreme heat or cold means higher bills regardless of rate

HomeStats includes electricity prices from EIA data on every state page and factors energy costs into the total annual cost of homeownership.