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Which states have the cheapest electricity rates in the United States?

Energy prices are going up, but residents of these states may be saved from severe price hikes.

Energy prices are going up, but residents of these states may be saved from severe price hikes.
Luke MacGregorREUTERS

The United States is the second-largest energy producer in the world.

This level of energy independence has given the country more resources to weather the market shocks resulting from the Russian invasion of Ukraine.

Russia’s natural gas and petroleum supplies are being disrupted by sanctions that are making the country a risky business environment. Although policy makers had tried to save US households from feeling the impact of sanctions, some households are receiving higher bills. The Consumer Price Index has tracked an eleven percent increase in the price of electricity over the last year.

Which states have the lowest electricity prices?

The average cost of a kilowatt-hour in the United States is 0.14 cents. However, residents in most states pay less than the national average.

Nebraska’s electric cooperatives

In part, Nebraska has the lowest electricity costs in the country because of its community-owned energy providers rather than for-profit companies.

The Nebraska Power Authority, which represents the 166 different community-owned utilities in the state, has stated that “public power rates are lower than those of other utility companies.”

“That’s because local, not-for-profit utilities have the power to put their neighbors first. Keeping energy costs affordable serves every community’s long-term needs, and that’s what public power is all about.”

In Nebraska, these locally-owned utilities set the price “using community-controlled boards that hold public meetings.” Additionally, the state finances “improvements with municipal revenue bonds that are exempt from federal income tax.”

North Dakota

The state’s low electricity costs stem from the state being the second highest producer of petroleum in the country, after Texas. Overall, the state ranks sixth in overall energy production.

North Dakota’s small population meant that residential electricity use only accounted for eleven percent of all energy consumed. The state is one of the most energy-rich areas globally, home to the “world’s largest known deposit of lignite,” and produces around four percent of all coal consumed in the US.

On the cleaner side, wind energy accounts for around thirty-one percent of all electricty generated in the state.


Cheap hydroelectric power, responsible for around fifty-one percent of all energy generation in Idaho, helps keep costs down. The third lowest rate the country, residents in December 2021 paid $9.90 cents/kWh.

Around seventy-four percent of the state’s energy comes from renewable sources. Biomass, which is a controverisal renewable energy source, is included in this figure. Idaho is known for harsh winters, with most residents using natural gas to heat their homes. With a smaller population, this quantity of natural gas used still places the state in the lowest third of consumers.


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