Electric Rates for Summer 2025 and Beyond
It’s that time of year again when it feels like electric costs are soaring to unprecedented levels — and that’s because they are. Con Edison’s rates are rising, and other subtle components of the cost structure are contributing to higher bills.
Most of the increase will appear on the delivery side of your bill. Delivery refers to the portion of the bill paid to the utility, or Con Ed, for distribution of the energy and the associated costs of upgrading and maintaining the distribution system. The primary driver of your delivery cost is demand (or “kW”), which is a recording of the peak 15-minute interval of electric usage for a property in a given period. One extremely hot day with heavy cooling demand can impact an entire month of billing.
The kW is then multiplied by a price per kW, which can vary depending on the rate class and time of year. During the summer months of June through September, kW rates are significantly higher than the remainder of the year. This summer, master-metered and common area meter accounts are experiencing a 30 percent increase compared to pre-June months, while accounts in the electric-heat rate class are bearing an 80 percent increase. These increases in this cost component alone will translate to a 10 to 20 percent hike in overall cost per kWh.
That’s not all. Try to remember where you were on June 24. Hiding inside an air-conditioned room? That makes sense. On that day, NYC experienced 100-degree temperatures, marking the hottest day since July 2012. The peak recording of 102 at JFK airport was the hottest June temperature ever documented in that location.
Any billing period that includes this date is likely to see a sharp increase in delivery costs due to high demand readings, with summer demand rates further compounding the impact. What’s unusual about this period is that the rest of June saw seasonally typical temperatures — unlike June 2024, which brought multiple heat waves. As a result, the large delivery costs are spread across lower overall consumption year-over-year, leading to double-digit increases in the rate per kWh compared to last year.
Unfortunately, July 29 came close to matching June 24’s anomalous heat. With both high demand rates and high kW, we’ll likely see this impact reflected again in the next set of invoices covering that date.
Looking ahead, more of the same could be in store for next year. Con Ed has proposed to the New York Public Service Commission an 11% increase in delivery revenues for the 2026 budget year, citing infrastructure improvements, clean energy investments, and financial support for low-income customers. This follows similarly sized annual rate hikes each year since 2023. This reality should be factored into 2026 energy budgets.
While energy efficiency projects are often discussed in the context of carbon emissions reductions under Local Law 97, remember that lowering consumption and demand can also directly reduce your utility expenses. If your building systems are aging or not consistently maintained, consider allocating budget toward efficiency upgrades — many options offer strong returns. Even newer buildings can benefit from targeted improvements. In extreme weather scenarios, the ability to keep costs from ballooning can be a significant advantage.
Market Analysis
Natural Gas
The prompt month NYMEX finally provided welcome relief. By the end of July, moderating weather forecasts led the NYMEX to decline to approximately $3 per MMBtu. On the supply side, total working gas in storage is a healthy 6.7% above the five-year average. The July settlement (for the month of August) closed at $3.08, the lowest since November 2024.
Electricity
July brought the summer heat that New Yorkers have been expecting, with many days in the 90s and nearly hitting triple digits. On such days, the NYISO unsurprisingly spiked, but otherwise daily averages were in the 4 to 6 cents per kWh range. Full-month average NYISO exceeded 7 cents – a bit high even for the summer – as greater cooling demand continues to place stress on the grid.
Crude Oil
Crude oil markets were relatively muted in July without much volatility. Occasional movement was spurred by bouts of geopolitical events, such as speculation on tariff policies and conflicts in Europe and the Middle East, but nothing caused major swings. Price per barrel ended the month at $69.
💡 Mitchell’s Tip: Invest in energy efficiency projects.
