Winter electricity rates are rising: what extreme cold does to your power bill

When it’s bitterly cold, your house feels different. The air outside stings, the air inside feels dry, and your heat never seems to shut off. Then the bill arrives, and it’s bigger than you expected. Here’s why that happens, why this winter may be more expensive than usual, and what you can do about it.

The physics of staying warm

When the temperature outside drops, your heating system has to work harder to keep up. The bigger the gap between indoor and outdoor temperatures, the faster heat escapes through walls, windows, and roofs. Even if you never touch the thermostat, your furnace or heat pump runs longer just to hold steady.

It’s simple physics: the colder it gets, the harder your system works to replace the heat that escapes to the coldest place it can find.

The price of power in a cold snap

It’s not just about how much energy you use, it’s also about what that energy costs when everyone else needs it too.

According to the U.S. Energy Information Administration (EIA) households that heat primarily with electricity will pay about 4% more this winter than they did last year, roughly $1,130 on average between November and March. Even if the weather ends up only slightly colder, electricity generation, supply, and delivery costs continue to rise.

Across the U.S., the average cost per kilowatt-hour (kWh) has climbed roughly 6% year-over-year, according to federal data.

Rate hikes you should know about

Many utilities across the U.S. are filing increases or gearing up for winter rate pressures driven by higher fuel costs, infrastructure aging, and extreme weather. For example, if you live in Pennsylvania, several utilities have increased or proposed new supply rates starting this winter including PPL Electric, West Penn Power, Penn Power, Penelec, Duquesne Light, and PECO.  These changes mean your supply cost is going up in most areas, as you try to keep warm this winter, your rate per unit is already higher.

Whether you’re in New England, the Mid-Atlantic, the Midwest or West, it’s a smart move to review your rate plan and check whether your utility has filed or announced a rate change.

How your home plays a role

Cold weather exposes every weakness in a house. Drafty windows, thin insulation, and old ductwork leak warmth and force your system to run longer. The same heat you pay for often slips out before you ever feel it.

If your home relies on electric resistance heating or uses plug-in space heaters to chase the chill, those costs add up fast. These devices pull a lot of electricity, especially overnight when temperatures dip. That’s why two homes on the same street can have very different winter bills. 

How heating type affects your bill

The chart below illustrates how different heating types respond to colder weather. As outdoor temperatures drop, “heating degree days” — a measure of how much heat a home needs — increase.

Homes that rely on electric resistance heating see the steepest climb in costs because electricity becomes more expensive as usage and grid demand rise. Modern heat pumps perform better in cold weather, so their costs increase more gradually. Gas-heated homes, while still affected, experience smaller jumps since their main heating source isn’t electricity (though fans and longer indoor hours still add up).

The colder it gets, the clearer the gap becomes between heating types, and your home’s design and fuel system shape how steep that all gets.

When temperatures drop you shouldn’t have to choose between staying warm and staying within budget. The reality is that winter comfort comes at a cost, especially when supply rates rise and demand surges. But there are ways to take control without turning your home into a DIY project.

Keep an eye on your utility rates, make small adjustments where you can, and let smart tools, like automatic rate monitoring or switching services, do the heavy lifting for you. That way, you can focus on keeping your family comfortable and your home cozy, instead of worrying about what’s happening behind the meter.

Because when the next cold snap hits, you deserve warmth. Not sticker shock.