Don’t Blame Renewable Energy for Escalating Electricity Costs

The comments scream from our website every time we publish a story about renewable energy: it’s making utility costs higher! There’s some truth in that predictable dogma, but the issue is much more complex.

Determining utility costs, even without involving renewables, is a complicated equation, especially for a region that doesn’t have any of its own oil or natural gas (methane) and sits at the end of fossil fuel pipelines. It’s easy to blame new energy sources for escalating costs, even though wind and solar have been around a lot longer than the remains of prehistoric plants and animals — the burning of which is heating the planet and changing the composition of marine waters.

The fossil fuel industry and its enablers, however, have spent decades vilifying renewable energy, because it impacts CEO and shareholder portfolios. There are always more homes, yachts, and cars to buy and country clubs fees and Mad King tribute to pay.

They don’t care how much we are paying for electricity. They certainly don’t care about public health or environmental well-being.

In 2024, compensation for U.S. fossil fuel CEOs remained well above minimum wage, with average executive compensation in the energy sector reaching nearly $18.5 million. CEOs of the 10 largest U.S. utilities were paid more than $115 million combined in a recent three-year period as demand for electricity from their fossil fuel power plants jumped substantially because of the burgeoning cryptocurrency and artificial intelligence sectors.

In 2023, CEO pay at S&P 500 companies increased 6% over the previous year, to an average of $17.7 million in total compensation. But, sure, blame inflation and renewable energy for higher costs.

It’s time to change the paradigm. Renewable energy offers a cleaner and likely less expensive path forward — although corporate greed will certainly remain a problem.

Homeowners can’t drill for oil or gas in their backyards, but they can install solar panels on their roofs.

BTM solar saved southern New England a combined
$831 million from 2014 to 2019.

Between 2014 and 2019, behind-the-meter (BTM) solar produced more than 8,600 gigawatt-hours of electricity in the six New England states, according to a 2020 study. That energy saved southern New England ratepayers a combined $831 million in that time.

“Electricity produced from BTM solar reduces the need to run other power plants, which reduces the amount of electricity that electric utilities need to buy and saves customers money,” according to the 8-page study titled Solar Savings in New England. “By avoiding the need to run the most expensive power plant, when BTM solar lowers the amount of electricity purchased, it also reduces the price that all utilities pay.”

BTM solar is defined as small solar installations that don’t participate in New England’s energy markets. Even if you don’t have some solar panels on your roof, your neighbor’s array helps lower your utility costs.

Despite this fact, fossil fuel-backed interests continue to claim Rhode Island electricity prices are among the highest in the nation because of the state’s green energy policies. These same people never factor in the public and environmental health impacts of burning fossil fuels. The climate crisis is something they don’t care about, because it disproportionately impacts low-wealth families.

BTM solar avoided 4.6 million metric tons (5.1 million tons) of climate-changing carbon dioxide emissions from 2014 through 2019, according to the 2020 study, and avoided millions of pounds of other pollutants proven to have negative impacts on human health.

As a result, the researchers found BTM solar contributed $87 million in public health benefits. The burning of fossil fuels contribute zilch to public health, except to degrade it.

The study’s authors noted BTM solar reduces costs associated with generating capacity, transmission and distribution capacity, reliability, and retail margins. They also noted it provides other economic benefits, such as job creation, local tax base support, and participant cost savings.

“All of these benefits should be considered when looking at a full societal value of BTM solar,” they wrote.

The many benefits of solar energy, especially when compared to fossil fuels, are routinely dismissed. The benefits of wind energy are also fashionably ignored.

Offshore wind tends to generate the most power on winter evenings, when methane demand and power prices are at their highest in New England. (istock)

“Offshore wind is a critical resource for achieving New England’s climate goals and protecting New Englanders from energy price shocks, and it does so cost-effectively under a range of future gas prices,” according to a 2024 report.

Rhode Island, Massachusetts, and Connecticut are — or at least were — collectively targeting the development of some 9,000 megawatts offshore wind by 2030. The report analyzed the economic, climate, and public health impacts that building this energy infrastructure would generate. The report found offshore wind would:

Reduce New England electricity customers’ bills by about $630 million annually under a mid-range gas price scenario but reaching $1.7 billion annually in a high-gas-price scenario. This translates to reduced bills of $2.79 a month ($33.48 annually) for an average residential customer under mid-case future methane prices and $4.61 a month ($55.32) under a high-gas-price scenario.

Halve the amount of money New England spends on methane for power generation. In 2023, more than half of the electricity produced in New England came from power plants burning methane. Between 2000 and 2022, cumulative spending on methane for electricity generation in New England totaled $65 billion — an average of $3 billion flowing out of the regional economy annually.

Improve energy security by reducing the region’s reliance on methane pipelines. During winter cold snaps these pipelines often reach their maximum capacities. Adding more offshore wind would ease pressure on these fossil fuel pipelines.

Reduce carbon dioxide emissions from electricity generation by 14 million short tons annually (a short ton equals 2,000 pounds). This equates to a 42% reduction in annual CO₂ emissions.

Provide $362 million in annual public health benefits by avoiding 3,700 short tons of nitrogen oxide emissions, 824 tons of sulfur dioxide emissions, and 641 tons of fine particulate matter emissions.

New England’s heavy reliance on methane for electricity generation leaves it particularly prone to fluctuations in the fossil fuel’s price, which in turn causes electricity prices to spike, especially in the winter.

This month’s deep freeze pushed U.S. methane prices to their highest level since 2014, and nearly 10% of U.S. methane production was knocked offline by the recent storm that swept across much of the country.

Electricity prices in New England are set in wholesale markets based on the marginal cost of the most expensive generator needed to meet the region’s demand. Methane-fired power plants are usually the marginal generator, meaning they routinely set the market clearing price at which all electricity is purchased.

When prices in the methane market increase because of extreme weather or geopolitical events — the Russian invasion of Ukraine, for example — the price of electricity closely follows. An increasing overseas demand for liquefied natural gas exports exacerbates the regional methane price volatility risk.

I recently spoke with Christian Roselund, co-lead of Climate Action Rhode Island’s Yes to Wind campaign and a senior policy analyst for Clean Energy Associates, about New England energy costs. He said the “underlying dynamics that we’re talking about are complicated.” To help educate me, he shared a PowerPoint presentation he often gives to state legislators.

Roselund said in coastal regions like New England, offshore wind generates electricity during more hours than land-based wind, meaning it can meet a higher portion of power demand without overproduction. He also said New England offshore wind has the potential to save electricity customers some serious cash, as the aforementioned Synapse study outlines.

Roselund noted solar and wind have no fuel, which means it costs the same to have a solar or wind project generate electricity or not. He said this is unlike methane, coal, and petroleum energy, which have fuel costs.

Basically, “operators decide whether or not to run power plants at any given time based on whether or not they can get paid enough to cover those fuel costs,” he said.

“If they can’t cover the cost of the fuel, they’re not going to make money,” Roselund said. “Renewables have no fuel, so there’s no reason not to run solar or wind all the time that they’re available. Obviously, they’re not available all the time, but whenever they’re available they run because there’s zero cost. Marginal cost doesn’t matter to a solar or wind plant operator.
 Higher input from renewables means you have to buy less of the more expensive stuff. It takes the most expensive stuff off the cost stack.”

He explained solar and wind can bid into power markets at a minimum bid price of zero. When a bunch of what he called “zero marginal cost resources” are introduced into a power system, it means two things: they will run when other resources won’t because the prices are too low and they will lower the overall market price when they are operating.

He said renewables are forcing people and the energy industry to think about the possible need to redesign wholesale markets, because solar and wind reduce the revenues paid to fossil fuel power plants.

Besides suppressing the price of energy, especially during times of peak demand, solar and wind also reduce polluting greenhouse gas emissions.

Offshore wind tends to generate the most power on winter evenings, according to Roselund, when methane demand and power prices are at their highest in New England. Offshore wind generates the most when it’s coldest. Spring and summer is when solar is most productive.

The Providence resident, an energy policy analyst who has spent two decades researching and writing about the global transition to renewable energy, noted that even though the cost of offshore wind can be higher than the average cost of some other resources, such as utility-scale solar or combined cycle gas plants, it still has the potential to reduce power prices when it displaces generation that is even more expensive.

The contract with Vineyard Wind I is $74 per megawatt-hour, which translates to about 7.4 cents per kilowatt-hour. Roselund said that rate is “lower than our summer or our winter supply rate,” where 10 cents per kilowatt-hour in the summer and 15 cents in the winter are the average rates.

The Revolution Wind contract is $98 per megawatt-hour, or about 9.8 cents per kilowatt-hour.

“It’s really clear from the numbers that both Revolution Wind and Vineyard Wind are going to save people money in the winter,” Roselund said. “They might not do as much in the summer, but they’re unlikely to cost people money in the summer. They’re definitely going to save you money in the winter, which is when your power bill is substantially higher.”

He also noted that whether the power generated by these projects goes to Rhode Island, Massachusetts or Connecticut it’s lowering prices on the entire region’s wholesale power market.

Of the 99 top corporations to receive government subsidies, eight have a direct link to fossil fuels. None have a direct link to offshore wind.

As for the future of offshore wind, Roselund is cautious.

“I’m an advocate, but I’m also an analyst, and I got to tell you the truth, these future offshore wind projects may not save money,” he said. “And here’s why: everything got more expensive. Steel got more expensive. Lending, just borrowing money got more expensive. The interest rates went up, the steel went up. Trump made it [expletive] harder to do everything. We have these crazy [expletive] tariffs. Everything got more expensive, and the uncertainty, which is a major input into financing cost, so the lenders have to factor in policy risk.”

Greed drives the relentless burning of climate-changing, public health-degrading fossil fuels. (istock)

Renewable energy development is essentially being sabotaged by those in power across the country. Fossil fuel lobbyists are paid well, and the industry’s dark money flows freely.

Long before utility-scale offshore wind was introduced to New England or renewable energy programs created, the region’s electricity costs were steadily climbing. The status quo won’t change that.

Unfortunately, Rhode Island leadership continues to believe renewable energy is the enemy and fossil fuel pollution will magically disappear.

For his proposed fiscal 2027 budget, Rhode Island’s shortsighted governor, who is running for reelection, has essentially blamed renewable energy incentives, programs, and mandates for high utility prices. His leadership-lacking, Band-Aid solution is to rollback fees that fund wind and solar energy development and adoption.

Gov. Dan McKee ignores the fact the Ocean State’s overreliance on methane for electricity and home heating is what keeps energy prices in flux. He ignores the fact short-term savings come with long-term consequences, including higher energy costs. From toxic air to climate-changing greenhouse gases, fossil fuel pollution also degrades public health and cuts deep through economic bottom lines.

Mr. Status Quo apparently believes the solution lies with continuing to approve Rhode Island Energy increases every year right before winter begins to creep in. Delay the implementation of needed renewable energy so we can continue to burn prodigious amounts of fossil fuels.

Late last year, a few weeks before the governor unveiled his climate change-enabling budget, the Public Utilities Commission approved a Rhode Island Energy proposal to cut $19 million from the state’s energy efficiency programs. McKee now wants to cut such programs even further.

The world is changing and we need leadership who can keep up. Instead, we elect mostly uninspiring white men who want to drag us back in time.

For much of the past two decades, the U.S. power grid was defined by flat electricity demand, declining coal generation, and fewer carbon emissions, according to Michael Thomas, founder and author of a newsletter that focuses on reporting about the politics of climate change.

Last year, each of those trends reversed.

Electricity emissions rose in 2025 for the second straight year, as coal-fired electricity generation rose 12% and electricity demand outpaced renewables growth, Thomas wrote last month in his Distilled newsletter. The headline “The US Power Grid Had A Dirty Year in 2025” said it all.

He reported that electricity demand grew by 2.6% due to the growth of data centers, electrification, and extreme heat, among other factors. “Renewable energy’s contribution to the power grid rose again in 2025, but not enough to offset the country’s rising electricity demand,” he wrote.

Last year total U.S. electricity demand grew by 107 million megawatt-hours (MWh), or about 10 million homes’ worth, according to Thomas. From 2024 to 2025, most of the growth in fossil fuel power generation came from coal-fired power plants, as coal generation rose by 80 million MWh — more than solar and wind combined (73.5 million MWh).

This pace is unsustainable. Guzzling more energy powered by the burning of coal will kill us. We have the Mad King to thank.

Throughout his first year back in office, his regime has forced utilities to keep operating antiquated coal power plants that were set to retire — in most cases against the wishes of the utility and at significant cost to ratepayers.

After years of increasing investment in factories to make batteries, electric vehicles, solar panels, and other renewable energy technology — a surge prompted by the Biden administration’s Inflation Reduction Act — the trend reversed under MAGA last year. As a result, businesses are now making fewer plans to invest in renewable energy, and a lot of companies are backing out of prior commitments.

While the Mad King has ordered antique coal power plants to fire back up, the serial liar has twice ordered offshore wind projects under construction along the Atlantic Coast to stop work.

The latest Mad King tantrum, thrown Dec. 22, covered five projects, all of which were 40% or more complete at the time. All of this stopping and starting has cost consumers billions of dollars and kept needed new electricity off the regional grid.

“But the more important factors behind the resurrection of coal, which had long been in decline, were high natural gas prices and growing electricity demand,” Thomas wrote.

Last year the average cost of methane increased some 40% compared with 2024, according to the Energy Information Administration (EIA). Coal and methane power plants are always competing by bidding into electricity markets across the country. When methane prices are higher, coal plants win those bids more often, which ends up generating more greenhouse gas pollution and exacerbating the climate crisis.

Carbon emissions from the power grid rose by 4.4% in 2025, according to the EIA, largely due to the increase in coal power generation.

There is no such thing as “beautiful, clean coal,” despite the regime’s rantings. They lie. In fact, there is nothing clean about burning fossil fuels.

We need to decarbonize the power grid quickly, wisely, and affordably. It can be done if we had government that worked for we the people; special interests didn’t control statehouses; greedy, unethical tech bros were told no; and renewable energy wasn’t held to higher standards than fossil fuels.

Related notes: For a good explanation of the value stack and cost stack as related to the regional power grid, Roselund recommended watching a social media post by Sen. Sheldon Whitehouse, D-R.I. ISO New England is the grid operator for the six-state region.

Frank Carini can be reached at [email protected]. His opinions don’t reflect those of ecoRI News.