Cooling your home will get more expensive this summer, according to the Energy Information Administration.

The national average electricity price for households will rise around 4% this summer compared to 2021, according to the EIA’s Summer 2022 Electricity Industry Outlook.

Reasons for the surge include higher natural gas prices over the past 18 months; continued retirements of coal-fired plants and constraints in coal deliveries; and growing demand for electricity as the industrial and commercial sectors return to pre-pandemic production activity.

“These changes in supply and demand led to gradually rising wholesale electricity prices in recent months as well as contributing to price spikes at certain times in response to temporary constraints in supplying power,” according to the summer study, which was part of this month’s Short-Term Energy Outlook.

The summer forecast says residents will pay, on average, 14.4 cents per kilowatt-hour between June and August, a 3.9% rise over last summer. The commercial sector price is expected to average 12 cents/kWh (up 4.5%), and the industrial sector is expected to average 7.7 cents/kWh (up 2.9%).

While this year-over-year increase is larger than in recent years, it’s smaller than the increase between summer 2020 and summer 2021, when pandemic restrictions forced more people to stay home.

“Over that period, residential prices grew 5.0%, commercial prices rose by 5.5%, and industrial prices went up 6.0%,” the report said.

The EIA’s latest forecast continues to track a growing share of renewables in electricity generation. The share for renewables is expected to rise from 20% in 2021 to 22% in 2022 and 23% in 2023 due to continuing increases in solar and wind generating capacity.

The EIA expects that solar and battery additions will account for more than half of new electric sector capacity in 2022 and 2023. Planned wind additions will also add to that capacity—10 gigawatts in 2022 and 4 GW in 2023. Planned solar additions include 20 GW of utility-scale capacity in 2022 and 23 GW in 2023. Small-scale solar installations (systems less than 1 megawatt) will grow by 5 GW in 2022 and 6 GW in 2023.

Meanwhile, Henry Hub natural gas spot prices remain high. In April, the spot price averaged $6.59 per million British thermal units, compared to $4.90/MMBtu in March and $2.66 at the same time last year. EIA predicts even higher prices for the rest of 2022: an average of $7.83/MMBtu during the second quarter and $8.59/MMBtu during the second half of the year.

Next year, the EIA expects Henry Hub spot prices to average $4.74/MMBtu due in part to higher production of natural gas.

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