Cheapest States for Electricity 2024, Ranked by Cents per kWh

The 10 Cheapest States for Electricity

These states consistently rank at the bottom of the national rate table, meaning they offer the lowest electricity costs for residents and businesses alike. Source: U.S. Energy Information Administration (EIA) Electric Power Monthly, annual average residential rates.

Compiled by the RateWatt Editorial research team.

North Dakota

11.51
Idaho

11.52
Nebraska

11.53
Louisiana

11.73
Washington

11.9
Utah

12.22
Oklahoma

12.24
Arkansas

12.32
Tennessee

12.42
Wyoming

12.47

Rank	State	Avg Rate (¢/kWh)	Primary Driver
1	North Dakota	11.51	Local coal plus fast-growing wind
2	Idaho	11.52	Snake River hydro
3	Nebraska	11.53	Nonprofit public power districts
4	Louisiana	11.73	Cheap Gulf-coast natural gas
5	Washington	11.90	Columbia River hydro
6	Utah	12.22	Low-cost coal and gas
7	Oklahoma	12.24	Domestic gas plus wind
8	Arkansas	12.32	Natural gas and nuclear mix
9	Tennessee	12.42	TVA hydro and nuclear
10	Wyoming	12.47	Coal-heavy grid, small population

Source: EIA Electric Power Monthly. Rates are approximate annual residential averages. See all state rates for current data.

Compiled by the RateWatt Editorial research team.

The 10 Most Expensive States for Electricity

These states face structural challenges, isolation, high fuel costs, dense infrastructure demands, or heavy regulatory burdens, that drive rates well above the national average.

Hawaii

42.86
California

31.97
Massachusetts

29.35
Connecticut

28.75
Rhode Island

28.65
Alaska

24.82
New York

24.43
Maine

24.29
New Hampshire

23.4
Vermont

21.9

Rank	State	Avg Rate (¢/kWh)	Primary Driver
1	Hawaii	42.86	Imported oil, isolated grid
2	California	31.97	Wildfire-hardening and policy costs
3	Massachusetts	29.35	Constrained gas pipelines
4	Connecticut	28.75	Gas plus heavy policy charges
5	Rhode Island	28.65	Gas-dependent, dense grid
6	Alaska	24.82	Isolated micro-grids
7	New York	24.43	Regional cost pressures
8	Maine	24.29	Winter peak, imported fuel
9	New Hampshire	23.40	Regional gas constraints
10	Vermont	21.90	Small isolated load

Note: California's rate reflects a 2024 surge driven by PG&E, SCE, and SDG&E wildfire infrastructure charges. Browse all 50 states on RateWatt.

Why Hydro States Win on Price

Washington, Oregon, Idaho, and Montana all benefit from Pacific Northwest hydroelectric infrastructure built largely in the mid-20th century. The Columbia River system alone, Grand Coulee, Bonneville, and over 30 other federal dams, generates massive amounts of electricity at near-zero marginal cost. Once a dam is built, the "fuel" (water) is free and the plants run for decades with minimal operating expense.

This infrastructure advantage is almost impossible to replicate. No new large hydroelectric dams are being built in the US, environmental regulations, lack of suitable undammed rivers, and cost make it impractical. States with existing hydro are sitting on a permanent competitive advantage for low electricity rates. See the hydro energy source page for more detail.

Why Gas-Rich States Are Cheap

Louisiana, Oklahoma, Arkansas, and Texas sit atop shale gas formations or are connected directly to major gas production regions via pipeline. Natural gas is their primary generation fuel, and buying it close to the source without long-distance transmission costs keeps fuel prices low. When national gas prices spike (as in 2022), these states feel it, but their baseline rates remain below average because their non-fuel costs are also low.

Oklahoma and Texas also benefit from abundant wind energy, which adds a zero-marginal-cost fuel source to their mix. The combination of cheap gas as a backup and growing wind generation keeps rates competitive. Check the most renewable states ranking to see wind's role.

Nebraska: The Nonprofit Model

Nebraska is a special case. It is the only state where all electricity is served by publicly owned utilities, no investor-owned utilities operate there. Nebraska Public Power District and other public power entities don't need to generate shareholder returns. Rates are set to cover costs, not maximize profit. This structure consistently delivers below-average rates and was a deliberate policy choice made in the 1940s.

Several other states have significant municipal and cooperative utility sectors that operate similarly. Public and cooperative utilities typically serve rural areas and often charge higher rates than investor-owned utilities in the same state due to lower density, but Nebraska's statewide system achieves scale that individual co-ops cannot.

New England's Persistent Problem

Connecticut, Massachusetts, Rhode Island, and New Hampshire consistently rank among the most expensive states (excluding Hawaii and Alaska) for a structural reason: the region lacks adequate natural gas pipeline capacity into New England. During cold winters, gas demand for heating and electricity spikes simultaneously, but pipelines can't deliver enough to meet both. Grid operators must turn on expensive "peaker" plants running on oil, LNG, or other fuels, pushing wholesale prices to extreme levels that spread through the entire market.

Multiple pipeline expansion projects have been proposed and blocked over the past decade due to state opposition. The result is a structural supply constraint that keeps New England electricity expensive until either more pipeline capacity is built or offshore wind fills the gap. Check price trends to see how these states compare historically.

California's Special Case

California was long in the middle of the national rate spectrum, until the 2020s. A combination of factors has pushed California rates to among the highest in the continental US: utilities including PG&E have embedded billions in wildfire liability costs into customer rates, the state's mandate to retire fossil fuel plants has increased reliance on expensive grid imports, and fixed monthly charges have risen sharply. The state's high wages, property values, and regulatory compliance costs add further pressure.

California's experience shows that even states with abundant sunshine and growing solar installation can have high electricity rates when infrastructure and liability costs are extreme. The per-kWh rate doesn't capture everything, California customers also benefit from mild weather that reduces total consumption significantly compared to heating-intensive states.

What This Means for Relocation and Business Decisions

Electricity costs matter differently depending on your situation:

Households with EV or heat pump: High electricity usage magnifies rate differences dramatically. A household using 2,000 kWh/month saves $2,640/year moving from Connecticut (22¢) to Washington (10¢).
Energy-intensive businesses: Data centers, manufacturing, and agriculture choose locations largely on electricity cost. States like Washington and Idaho actively market their low rates to attract these industries.
Solar economics: High-rate states paradoxically make solar more attractive. In California or Connecticut, solar panels pay back faster because displacing expensive grid power saves more per kWh.
Remote work: Location-independent workers can arbitrage electricity costs. Choosing Louisiana over New York for similar lifestyles saves meaningful money over time.

Browse all 50 state pages on RateWatt for current rates, sector breakdowns, and generation mix data.

Frequently Asked Questions

Which state has the cheapest electricity in the US?

North Dakota currently has the cheapest residential electricity in the US at 11.51¢/kWh, followed closely by other low-cost states clustered near 11.53¢/kWh. These states share abundant in-state generation, hydro, domestic natural gas, or both, that keeps rates well below the national average.

Why is Hawaii's electricity so expensive?

Hawaii generates most of its electricity from oil, which must be shipped to the islands. Its isolated grid cannot import power from other states. High transportation costs for fuel, limited economies of scale, and no pipeline connections all combine to push rates above 40 cents/kWh, more than double the next most expensive state.

Does cheap electricity mean worse reliability?

Not necessarily. States with cheap hydroelectric power (Washington, Oregon, Idaho) tend to have very reliable grids because hydro plants run steadily. Louisiana's cheap natural gas rates come with vulnerability to hurricane damage. Cheap rate and reliability are driven by different factors.

Do deregulated states have cheaper electricity?

Not reliably. Texas, a deregulated state, has moderate rates. Pennsylvania and Ohio are deregulated with mixed results, some customers find savings, others pay more. Deregulation creates competition but doesn't guarantee lower prices. The cheapest states (Louisiana, Washington) are regulated markets.

How much could I save by moving to a low-cost electricity state?

The average US household uses about 900 kWh/month. Moving from the priciest state (Hawaii, 42.86¢/kWh) to the cheapest (North Dakota, 11.51¢/kWh) cuts a 900 kWh bill from about $386 to $104 a month, roughly $3386 a year. Households with EVs, heat pumps, or electric heating save proportionally more.

Are electricity rates the same for everyone in a state?

No. EIA reports state average rates, but individual rates vary by utility, city, and rate schedule within a state. Rural electric cooperatives often charge more than investor-owned utilities in the same state. The state average gives a useful benchmark but your actual rate depends on your specific utility.

Sources

U.S. Energy Information Administration (EIA), Electric Power Monthly, Table 5.6.A
EIA, State Electricity Profiles (all 50 states)
EIA, Annual Energy Outlook
U.S. Bureau of Economic Analysis, Regional Economic Accounts

This content is for informational purposes only. Electricity rates fluctuate and are reported as approximate annual averages. Contact your local utility for current rates specific to your account.

Worked example: putting the numbers together

Consider two electricity offers in a 1,000-kWh/month household. Plan A: 8.9¢/kWh + $9 monthly fee + $4.50 distribution rider = $89 + $9 + $4.50 = $102.50/month. Plan B: 11.2¢/kWh flat with no riders = $112/month. Plan A appears 26% cheaper per kWh but is only 8.5% cheaper monthly. If the household drops to 500 kWh in shoulder months (April, October), Plan A becomes $44.50 + $13.50 = $58; Plan B becomes $56, Plan A's advantage shrinks to 3%. If the household summer-peaks at 1,800 kWh (heavy AC), Plan A becomes $160.20 + $13.50 = $173.70; Plan B becomes $201.60, Plan A's advantage widens to 13.8%. Variable-usage households benefit more from per-kWh-optimized plans; flat-usage households benefit from bundled-fee-light plans. (Illustrative offers, not live quotes, your utility's tariff sheet is authoritative.)

An electricity rate is not a price, it is a structure, and the household that wins is the one that matches its load curve to the plan's fee architecture rather than chasing the lowest advertised kWh.

How to use RateWatt to find your best electricity option

Start with how electricity rates are built to grasp the kWh-plus-fees model, then use state-level rate data to benchmark your bill against your state median. The rate-structure guide walks through fixed, tiered, and time-of-use pricing. For state-by-state comparison, the why-prices-vary guide shows why states like Idaho and Hawaii sit at opposite ends of the rate curve. The renewable cost comparison covers the levelized-cost-of-energy (LCOE) data behind shifting state generation mixes. Every rate we publish comes from EIA Form 861 (utility annual reports) and EIA Electric Power Monthly, the same data utilities file with FERC.

Cheapest states for electricity