GATEWAY WEST & METRO EAST IL Blog

Why Your Electric Bill Is Soaring in St. Louis?

U.S. electricity customers are facing some of the largest bills in years because of volatile natural-gas prices, which are being driven higher by winter demand and a global supply shortage being made worse by Russia’s war against Ukraine.

Already, the natural-gas supply crunch has made it substantially more expensive for utilities to purchase or produce electricity. As a result, some customers have seen winter power bills increase by 20% or more compared with the year before, in addition to seeing higher home-heating bills.

Now, with sanctions against Russia threatening to further constrain global natural-gas supplies, higher prices are likely to persist, executives and analysts say, especially in regions heavily reliant on the fuel for power generation.

Domestic natural-gas prices reached the highest levels in years ahead of winter as exporters shipped record amounts of it overseas, and prices have lately risen again on fears of another global shortage.

“It will have an impact on customers’ bills,” said Nick Akins, chief executive of American Electric Power Co. a utility company that serves more than five million customers in 11 states.

Utilities across the country recover gas and electricity supply costs by charging them to customers, driving prices sharply higher this winter after a year of steady increases. Average retail electricity prices for residential customers rose 4.3% last year to 13.72 cents per kilowatt-hour, the largest annual increase since 2008, according to the Energy Information Administration. The increase, which generally matched inflation overall, was spurred in part by the cost of natural gas delivered to power plants, which more than doubled from 2020.

Utilities must receive regulatory approval to raise rates, but it is generally standard practice for regulators to allow for them to recoup higher fuel and supply costs through customers.

The growing prices of gas and electricity have everyone in shock of their home's energy bills but one great way to help those soaring costs is to ensure your home is properly insualted. When your home is more energy-efficient, you’ll likely see your heating and cooling bills dip significantly. This is because your home can maintain a consistent temperature for longer periods without as much help from your heating or cooling systems. This results in less energy being used to heat and cool your home and thus significantly reducing your energy bills, increasing your energy efficiency.

At Koala Insulation of Gateway West, our team is dedicated to increasing comfort and safety for you and your household. This includes ensuring our service not only brings you cost-effective and energy-efficient installations but also materials that have been treated and tested to improve the security of your home. If you have questions or concerns about the material currently in your home, our industry experts can provide details on your current condition and how your safety and comfort can improve.