Why Are Utility Rates Skyrocketing?

Throughout the United States, the plan to deregulate the utility industry so as to bring about lower utility rates has failed. Instead of seeing a reduction in rates, many utility customers have seen their rates double and in some cases even triple ! A few areas have had local governments step in with surplus funds and have temporarily rolled back rates, but unfortunately this assistance won't last, as soon as the funds run out, rates will once again reach their stratospheric levels.

During a recent conversation with a local utility company employee, the complicated explanation for the reasons behind the rate increases can be reduced to a few key points.

First, fuel costs for powering the nations power plants have skyrocketed as has been evidenced in the explosion of natural gas and crude oil prices.

Second, the cost of polluting the environment, in the form of burning fossil fuels in order to generate electricity has now reached never before seen levels, especially the cost of NOX credits which have risen over a thousand percent in the last few years.

Third, the entire electrical grid is now showing its age and is in need of a complete overhaul which will cost millions if not billions of dollars.

And finally fourth, even with a complete overhaul of the nations electrical grid, we will be no where near meeting the demand for electricity that our country's growth will be generating over the next few years. We need many new power plants and there is simply is not enough money or time to build them.