Reality Check: How to Grow the Grid, but Not Electricity Costs

As US utilities unleash a wave of spending on new power plants and grid enhancements, past eras of grid growth offer a proven path to streamline today’s upgrades — and deliver more power, more affordably.

Electricity bills are rising across much of the United States with no end in sight, meaning we are heading into 2026 at risk of handicapping emerging economic sectors such as data centers and advanced manufacturing that depend on low-cost electricity, as well as increasing hardship for families that already struggle to pay power bills.

With utilities planning to spend an unprecedented $1.4 trillion dollars by 2030 in grid upgrades to meet rising demand for power, concerns are mounting that high electricity costs could slow economic growth and put more households at financial risk.

So, as a new year dawns, let’s resolve to take steps that will deliver a more affordable and more reliable electricity system, one that best supports America’s growing economy and communities.

Here, we present three resolutions, drawing inspiration from the successes of the 20th century’s utilities and  policymakers who presided over massive grid growth — a fourfold expansion of electricity demand — all while driving down inflation-adjusted electricity prices by more than 20 percent.

Resolution 1: Embrace tomorrow’s tech

In the 20th century, technological breakthroughs — like bigger, more-efficient coal plants through the 1960s on the supply side as well as technologies such as efficient lighting, refrigeration, and cooling on the demand side — expanded options for delivering more value to consumers with less energy, all while lowering costs. Power companies’ and policymakers’ experimentation with these and other new options helped take advantage of technological innovation, rather than relying on the familiar.

Today, innovation is just as important, but in different technologies. Improvements in coal plants have long since stagnated and undercut their competitiveness, but gas turbines, wind, solar, and large batteries have each undergone waves of cost-cutting improvements in the past few decades, and new technologies such as advanced geothermal or fusion offer further promise.

The United States is already demonstrating leadership in geothermal, where oil and gas drilling expertise has helped drive down the cost of drilling for heat instead. Examples from Germany, Australia, and China show that further US cost reductions are possible in solar and batteries. And on the demand side, continued technological innovation demonstrates that energy efficiency is the gift that keeps on giving, and likely the biggest untapped resource in addressing grid challenges as they emerge.

Resolution 2: Build faster, build better

From 1960 to 1980, utilities tripled the size of the power plant fleet and built tens of thousands of miles of transmission. Policymakers enabled this growth by reducing red tape and clearing barriers.

Today, the policy and regulatory landscape is much more challenging. Hundreds of billions of dollars in projects are stuck for years in so-called “interconnection queues,” dated processes that hamstring today’s infrastructure needs. Policymakers are also imposing other bureaucratic delays, or outright canceling work, on projects that could quickly add power to the grid and lower prices.

Yet some states are showing how to move faster. In Texas, state-level grid infrastructure planning and investment processes beginning in 2005 have helped new energy projects of all types (including gas, wind, and solar) come online, which in turn has cut power prices. More recently, in Virginia, software upgrades to the state’s project permitting process have reduced processing times by 70 percent, showing that it is possible to slash a major source of cost, uncertainty, and delay that plagues energy projects nationwide.

Resolution 3: Make the most of the grid we’ve got

This third New Year’s resolution to make electricity more affordable is perhaps the most important. Looking back to the early 1980s, US power plants ran at full output only 45 percent of the year on average. But by using novel techniques – such as lower prices during off-peak times of the day — utilities pushed utilization higher, and by 2000, power plant utilization had increased by 18 percent. This allowed utilities to spread the cost of infrastructure over a higher sales volume, contributing to a 21 percent drop in real electricity prices.

As we look to 2026, the opportunities for this system-level cost efficiency are even greater. Digital tools now allow utilities to coordinate millions of devices — cars, home batteries, smart appliances — to function like a massive “virtual power plant.” This past summer in California, more than 100,000 home batteries delivered the output of a large traditional power plant — without utilities having to build one.

Utilities also have new, inexpensive tools to push more energy through existing power lines. In New York, relatively low-cost sensors and controls let the local utility move more electricity to support economic growth, without building new transmission lines. Across the country, utilities can apply these methods to relieve bottlenecks, defer costly construction, and ultimately reduce customer bills.

A happy New Year for affordable electricity

Keeping electricity costs down will require resolve from many different actors across the industry – and fortunately, there are tools available to support each critical decision-maker in designing an affordability strategy for their state.

For example, state utility regulators in dozens of states are using novel policies and incentives that can reward utility investors when they deliver cost savings for customers, spurring the kind of technical and process innovation we need to realize the benefits of new technologies, build faster, and increase system efficiency. State legislators now also have a robust and growing toolkit of policy concepts and ready-to-implement solutions for electricity affordability, adaptable to diverse cost drivers and needs across states.

Resolving to learn from the lessons of the 20th century and put them into the context of the new opportunities and changing needs in 2026 provides a pathway to keep our electricity system as affordable as possible.

We’ve done it before, and we can do it again. Our economy and our communities depend on it.