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TUESDAY, NOVEMBER 24, 2009
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6

Recession Pulls Plug on Electricity Prices

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(Newser) – Electricity prices across America have nosedived amid an almost unprecedented fall in demand, the Wall Street Journal reports. Market prices are down up to 40% from the historic highs of last year, and are on course to keep plummeting. The lower prices aren't always seen by consumers immediately because of long-term contracts, but most can expect reductions to eventually filter through.

This year is expected to witness the sharpest falloff in electricity demand in over 50 years as businesses contract and stretched households aim to cut down power usage. The lower electricity prices are one of the few bright spots in the recession for many businesses, although some analysts warn that with power plants now having no financial incentive to build new resources, there could be a shortage of supply—and consequently much higher prices—when the economy bounces back.

There only have been five years since 1950, including 2008, in which electricity demand fell in the US.
There only have been five years since 1950, including 2008, in which electricity demand fell in the US.   (AP Photo/Damian Dovarganes)
Analysts warn that with deregulation and lower prices, many power companies are failing to replace aging resources.
Analysts warn that with deregulation and lower prices, many power companies are failing to replace aging resources.   (AP Photo/Charlie Riedel, file)
Electricity prices are down a full 40% in many markets this year.
Electricity prices are down a full 40% in many markets this year.   (AP Photo/J. Pat Carter)
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6 comments
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oldgoat
Aug 12, 09 4:46 AM CDT
So now we will be getting rate increases to make up for the loss of revenue? Reply
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+4
metalworldorder
Aug 12, 09 5:43 AM CDT
Makes sense. I live in a two bedroom apartment and my electric bill was 200 bucks--that was without running the AC. I guess you can thank monopolies for that one. Reply
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+3
peacenique
Aug 12, 09 6:18 AM CDT
I thought the article said that our prices will drop... but the quality of the service will suffer in the long run. I was thinking maybe brown-outs and such. Now's the time to look into some alternate sources! I have a few homemade solar heaters ready for my southern windows come winter! Reply
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0
my-name-here
Aug 12, 09 12:11 PM CDT
There is always a "reason" why you'll pay more and not less, when these industries are essentially monopolized. thank you de-regulation. Reply
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BlueAyez
Aug 12, 09 12:56 PM CDT
Or is it a "poison pill" strategy to eliminate the competition-- sustainable energy? Reply
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+1

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