** 8/27/25 - Rising power costs in Illinois and battleground states spell political risk..........
Buzz Sawyer
Rising power costs in Illinois and battleground states spell political risk
Nowhere is that more apparent than on the largest US grid, stretching from Virginia to Illinois, where the cost of securing wholesale power supplies has been at a record for two straight years. The region includes two states electing governors this November, as well as four that are facing competitive House and Senate races next year. And nearly all of the electricity there comes from natural gas, nuclear reactors and coal.
That means President Donald Trump’s strategy of blaming renewable energy for surging electricity costs – including calling wind and solar “the scam of the century” last week — may have a hard time gaining traction.
The problem isn’t exclusive to PJM. Electricity prices, nationally, rose at more than twice the rate of overall inflation in the past year and are holding near a record high. But the issue’s political salience in the region suggests soaring utility bills are shaping up to be a key issue at the ballot box.
“Pain at the plug is going to be the narrative that politicians stump on,” said Jed Dorsheimer, an equity analyst at William Blair & Co.
Against that backdrop, power costs have become a key issue in New Jersey’s gubernatorial election, with Democratic candidate Mikie Sherrill pledging to freeze utility rates if she’s elected. In Virginia, home to the nation’s biggest AI data-center build-out, cost-of-living is similarly a top issue in the governor’s race, according to a Virginia Commonwealth University poll. And in Michigan, Ohio, New Jersey and Pennsylvania – PJM states facing tight Senate or House races – some 25% of residents can’t afford to pay their utility bills, according to a study by Utility Rates.
“The politics of it are significant” given that Trump campaigned on fighting inflation, said Kevin Book, managing director at Washington-based research firm ClearView Energy Partners LLC.
Trump has vowed repeatedly to halve power prices within 12 months of taking office as well as double electricity capacity. Instead, residential electricity prices have climbed about 10% from January until May and are projected to rise another 5.8% next year, according to the Energy Information Administration.
The president’s own policies are poised to exacerbate that trend, critics say. Since taking office, Trump has halted the development of two wind power projects, including one key to meeting demand in the US Northeast, where a dearth of supply has strained the grid. And the recent rollback of clean energy tax credits is expected to curb the build-out of other planned renewable plants.
“Basic economics shows that restricting supply in the face of rising demand drives prices higher,” said American Clean Power Association Chief Executive Officer Jason Grumet. “By slowing clean energy deployment, the administration is directly fueling cost increases.”
Energy Secretary Chris Wright, in a statement, said the administration’s efforts to “unleash American energy” would lower electricity prices.
“In the coming years, America’s reindustrialization and the AI race will require a significantly larger supply of around-the-clock, reliable and uninterrupted power,” he said. “President Trump’s administration is committed to advancing a strategy of energy addition, and supporting all forms of energy that are affordable, reliable and secure.”
Trump has made a priority of domestic energy production, beginning to roll back environmental regulations that drive up the cost of fossil-fuel development and making it easier to pump oil and gas. He’s also ordered power plants to continue operating and expedited the development of new nuclear reactors. Yet electricity prices continue to rise.
One thing Trump can do to lower power costs is invest in upgrading the transmission system, said Devin Hartman, policy director of energy and environmental policy at think tank R Street.
Transmission costs are the fastest growing segment of power prices in many regions, according to Rachel Gold, a principal for clean energy non-profit RMI. That’s because new infrastructure must be built to connect distant power generators to demand hubs like cities while aging, existing transmission and distribution lines must be modernized and hardened against extreme weather.
The only way to provide consumers with relief from transmission costs, which tripled in the last two decades, is to upgrade existing lines with better conduits, sensors and other existing grid enhancing technologies, said Hartman. “That is your one shot to really reduce costs in the 2020s.”
Wright himself has pointed to the political risk associated with rising utility bills, telling Politico in an interview this month: “We’re going to get blamed because we’re in office.”