Consumers increasingly on the hook for higher energy prices

May 31 (UPI) -- Residential electric bills over the first three months of the year were around 5% higher than last year and that trend could continue, the U.S. government said Wednesday.

The Energy Information Administration, the statistical arm of the Energy Department, said the average monthly electric bill averaged $133 over the first three months of the year.

"The increase was driven by a 13% increase in the average U.S. residential retail electricity price, which was partly offset by a 7% decrease in average monthly electricity consumption per residential customer," EIA reported.

Over the coming summer, the agency expects bills to be about 2% higher than a year ago. Similar to the first quarter, EIA said costs could be offset somewhat by a decline in consumption.

Through June of last year, consumer prices were 8.5% higher on an annual basis than the prior year. For just energy, prices were up 44%, natural gas in the utility sector was up 30.5% and electricity was up 15.2%, federal data show.

Driven in part by a premium on commodities from the war in Ukraine, last year saw the largest annual increase in consumer electricity bills since EIA started keeping records in 1984.

The increase was driven by a combination of more extreme temperatures, which increased U.S. consumption of electricity for heating and cooling, and higher fuel costs for power plants, which drove up retail electricity prices, the agency stated.

The price for the fuels -- natural gas, coal and petroleum -- directed to U.S. power plants increased last year by 34% over 2021, and much of that increase made its way to consumers.

Inflation, however, is moderating. Through April, the last full month for which the government has data, consumer prices were up 4.5%, total energy prices contracted by 5.1%, natural gas was down 2.1%, though electricity was up 8.4% on an annual basis.

Most major commodities are well below year-ago levels. After reaching $120 per barrel in June 2022, West Texas Intermediate, the U.S. benchmark for the price of oil, was trading in the mid-$60 per barrel range on Wednesday. Henry Hub, the natural gas benchmark, is more than 70% peak levels from last year.