U.S. Electricity Retail Prices. During 2010, retail prices for electricity distributed to the residential sector averaged 11.58 cents per kWh, about the same level as in 2009. EIA expects residential prices to rise by 1.0 percent in 2011, followed by an increase of 0.5 percent in 2012 (U.S. Residential Electricity Prices Chart).
The effect of lower generation fuel costs in 2011 should be more evident in retail prices for electricity distributed to the industrial sector, which EIA projects will fall 1.6 percent during 2011 and then rise 0.2 percent next year.
2 comments:
Dear Electricity Guy,
The observation that lower fuel prices, which means renders cheaper generation costs, but only translates into cheaper electricity for the industrial sector, not the residential sector, is consistant with a phenomenon I observed in my studies. I ran a linear regression analysis on the price that generators paid for natural gas (EIA data for TX, OK, and LA)from Feb 2002 through September 2009 to look for a correlation with the residential price for electricity, paid by residents of Texas, Oklahoma, and Louisiana.
Now, LA and OK are regulated states who use comparable amounts of natural gas in state power generatiom with Texas. Texas was like 47%, LA was like 45% and OK was like 40%. In the two regulated states the linear regession analysis showed correlations both over .5 (which shows a strong correlation). In Texas though, where the most natural gas is used in the generation process, I only found a .121 correlation (little to no signifigance between the two varibles). I just thought that was interesting.
Perhaps Christopher or another person could provide a layman's understanding of these correlations.
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