Summer heat to crank up electricity bills, gas prices: EIA

Summer heat is forecasted to show in the outdoor thermometer and Americans' electricity bills, the Energy Information Administration (EIA) expected costs to rise by up to $173 per month from June to August.

Yahoo Finance Senior Energy Reporter Ines Ferré breaks down the regional trends anticipated for electricity and natural gas prices (NG=F) over the summer months.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Luke Carberry Mogan.

Video transcript

Hotter temperatures are expected to send residential electricity bills higher by an average of 3% this summer.

That is according to data from the Energy Information Administration and as is here to break down the reason behind the jump and the impact it could have on prices and as what you have for us.

Yes.

So what we're talking about are really the summer months, which would be June, July and August and monthly electricity bills on average are expected to be 100 and $73 in the US.

Although that's not my bill a bit higher than the 168 last summer, almost 90% by the way of households cool their homes with air conditioning.

So it's supposed to be a hotter summer and that means that residents will be consuming more electricity and that increased consumption will partially be offsetting those lower residential electricity prices.

Now, I want to pause for a minute to show you where we are going to see some higher prices versus lower prices because the Pacific Coast states, those are likely to see the biggest increase in electricity prices up 7% this summer.

And in New England you are likely to see lower electricity prices down 7% compared to last year because of lower natural gas prices.

Now, I do want to say the caveat that New England's average electricity prices are still very elevated to compare to the rest of the country in other parts of the nation.

The cost is 26 cents per kilowatt hour.

One point to note also is that natural gas prices have declined since last year.

They're lower than the at this time last year.

And that's a big component to make electricity.

But the transmission lines upgrading, maintaining the grid, that is more expensive.

You guys, one silver lining is that now energy units are more efficient.

So your air conditioning, air conditioners tend to be more efficient.

The EI A is forecasting that focus residents will be using or consuming less in that sense because of these more efficient air conditioning units.

I hope mine is one of those more energy.

Right.

Well, compared to last decade to, you know, 2010, they're comparing it to.

So, yeah, over time they've gotten better.