The U.S. Energy Information Administration on July 7 said it expects wholesale electricity prices this summer will be lower than last year for much of the country.
Lower wholesale electricity prices primarily reflect lower costs of natural gas delivered to power plants, particularly in the western part of the country, EIA said in its Short Term Energy Outlook.
Natural gas-fired power plants are often the marginal generator that ultimately determines power prices, it noted. “Heat waves during the summer months have the potential to cause wholesale electricity prices to temporarily spike higher than in our forecast, which represents a monthly average.”
EIA forecasts U.S. wholesale electricity prices this summer will be $4 per megawatt hour (MWh) lower than last year, hovering at an average of $45/MWh.
"Although wholesale prices at most of the 11 hubs we track show only minor changes from last summer, forecast prices at the representative hubs for the three western regions, along with the Midcontinent ISO (MISO) region, show relatively large decreases in our model," it said.
Alongside record natural gas production and low natural gas prices, these large, expected decreases in regional wholesale electricity prices are coincident with increased electric generation from various fuels, EIA said.
In the Northwest Mid-Columbia hub, prices drop 46% from an average of $50/MWh in summer 2025 to $27/MWh this summer, amid a substantial increase in hydropower.
EIA forecasts wholesale power prices in California will fall by 30% and average $23/MWh this summer, and in the Southwest, wholesale power prices fall by 27% and average $28/MWh. Natural gas prices in both of these regions are also relatively low.
Prices in the MISO region fall by 18% in the forecast, from an average of $56/MWh last summer to $46/MWh this summer.
In MISO, EIA expects large increases in solar generation, in particular, alongside increases from natural gas, wind, solar, and nuclear.
