New York has a serious problem with electricity prices, and its political class seems incapable of talking seriously about it. Until that changes, there’s little chance that the Empire State can make meaningful progress in preventing electricity costs from rising further, let alone bringing them down.
Residential electricity rates jumped an average of 8 percent last year, faster than the 5 percent growth rate nationally. Owing to a confluence of tax and regulatory policies, New York City has long had some of the nation’s highest electricity rates, but they’ve risen almost twice as quickly as inflation since 2019. Upstate has had an even tougher experience, with rates in the Syracuse region more than doubling.
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Some promising signs were evident not long ago. The early 2010s fracking boom drove down natural gas costs for New York power plants, the state’s biggest source of electricity. But Albany’s sweeping 2019 Climate Leadership & Community Protection Act ended a two-decade period of power-plant upgrades and replacements that helped control costs. It has resulted in a fleet of plants that is older, less reliable, and less efficient than it would otherwise be.
On the delivery side—where costs largely get passed directly to ratepayers—inflation increased grid operating expenses. Worse, though, the Climate Act also led utilities to incur and pass along substantial new transmission costs, in turn requiring ratepayers to subsidize a host of climate-related projects. Equipment costs for utility transformers and other components ballooned amid supply-chain disruptions and myriad state and federal policies that artificially boosted demand.
Instead of examining the impact of these policy choices, New York’s leaders have pointed fingers. In January, Governor Kathy Hochul unveiled a Ratepayer Protection Plan focused heavily on blaming utilities, while doing little to identify—much less address—the underlying drivers of high electricity costs. The plan ignores the extent to which utilities collect and remit over $1 billion annually for state-directed purposes, acting as Albany’s bag men. And it leaves untouched the climate-related mandates poised to push rates even higher.
Facing litigation from environmental activists, Hochul has pressed to relax Climate Act deadlines and postpone rules designed to tamp down demand for fossil fuels (outside the electricity sector) by driving up prices. These are half-measures, at best.
But other Albany leaders won’t even go that far. Speaking on the New York Law School’s Max Politics podcast last month, Senate Majority Leader Andrea Stewart-Cousins pushed back against Hochul’s efforts to change the climate law, revealing her own confusion about the issue.
“I never want to conflate, which unfortunately has happened, our climate laws with people’s high utility bills because we have not been able to really implement our climate laws,” she said. “So it has nothing to do with the current state of utility bills, which continue to go higher because now we have a war going on.”
Stewart-Cousins’s comments were remarkable on several levels. New York is behind schedule in imposing taxes and bans intended to reduce fossil-fuel demand—but it has enforced the Climate Act most rigorously in the electricity-delivery sector, where the state Public Service Commission approves capital plans and delivery rates in strict compliance with the law.
Electric utilities have substantially hiked spending to comply with the climate law, passing on the costs to ratepayers. New York’s Department of Public Service has estimated that 5.2 percent of Consolidated Edison residential customer bills in 2024 went toward “CLCPA related costs,” with that portion reaching between 7.7 percent and 9.5 percent upstate.
It will soon get worse: in the next few months, all New York customers will begin paying—via their supply charges—for the state’s costliest-of-their-kind offshore wind turbines and a new underground/underwater transmission line between Quebec and Queens.
Stewart-Cousins’s claim that New York electricity prices “continue to go higher” because of the Iran war does not square with the data. The commodity price of natural gas, which powers the biggest share of New York power plants, was significantly below its same-month average from 2025 in both February and March. New York plants do not burn fuel oil on typical days, and the state’s last coal-fired power plants, which relied on deliveries from diesel trains, closed more than five years ago.
New York Republicans, facing off this fall with Hochul and Stewart-Cousins’s Senate Democrats, have struggled to find clarity on these issues.
Nassau County Executive Bruce Blakeman, Hochul’s likely Republican challenger, issued bold pronouncements earlier this month, vowing to “cut your electric bills in half by slashing Hochul’s taxes, fees and surcharges on your bill.” But Blakeman has been unable to provide anything resembling a credible strategy for reaching that goal, even on a four-year timeline.
Blakeman could pull New York out of the Regional Greenhouse Gas Initiative, which adds about $5 to monthly bills for single-family homes in New York City. He could bar the state from entering into new contracts for battery storage, offshore wind, and other renewable subsidies. With cooperation from the legislature, he could cut taxes related to electricity, eliminate statutory mandates for renewable energy projects, and likely terminate most existing contracts.
All of that together, including axing every tax, still wouldn’t achieve his pledged reductions. Even if New York, somehow, cut residential electricity rates from last year’s average of 26.4 cents per kilowatt-hour to Pennsylvania’s 19.3 cents—enabled by abundant New York-sourced natural gas and a looser regulatory regime—Blakeman would still be only about halfway to his purported goal.
Legislative Republicans, boxed out of power, have taken a marginally more credible approach than Blakeman, noting that the state has been collecting various climate-related surcharges faster than it can spend them. But they’re too quick to reach for gimmicks, like income-based credits, and they don’t seem to understand any better than the Democrats the quarter-century of decisions that led to today’s pain. Some of their own members—including the Assembly GOP leader—voted for the 2019 Climate Ac, after all. And Republicans fear upsetting the shrinking construction unions by noting how Albany’s “prevailing wage” requirements hit electricity customers in the wallet.
Until Albany makes serious efforts to understand New York’s electricity costs, the bills landing on kitchen tables will grow bigger and hit harder.