How gas and power prices have become political experiments
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Average costs to power homes have been trending upward while gasoline costs have moved largely the other way, Labor Department data shows.
Why it matters: Steadily rising demand from AI, heat, an increasingly electrifying economy and more are all pushing up power bills.
The intrigue: It all makes the politics of energy prices heading into next year's midterms worth watching.
- Democrats and green groups hope to impose a political cost for rising electricity bills.
- The killing of renewables subsidies in the budget law will send prices higher, they argue in speeches and ads.
- Trump officials, meanwhile, say they're unshackling policy constraints on fossil fuels to keep prices in check.
What we're watching: DOE's independent stats arm sees residential power costs up 4% in 2025 to 17 cents per kilowatt-hour.
- The Energy Information Administration outlook released Tuesday sees another rise to 18 cents per kWh next year.
Yes, but: Gasoline prices are going the other way amid ample oil supplies and rather tepid global oil demand growth.
- EIA projects that the nationwide average retail price will be $2.90 per gallon next year, around 6% less than 2025.
What's next: The diverging costs set up a political experiment.
- If these trends hold, what matters more politically for the GOP as it seeks to keep control of Congress — higher bills to keep the lights on, or lower costs to fill up?
- One thing to keep in mind: gasoline costs are very visible and typically incurred more often than electricity payments.
- Lots of homes are heated with natural gas, too, and EIA sees a slight rise in residential prices this year and slight dip next year.
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