Utility Bills, Not Just Gas Prices, Could Decide the 2026 Midterms

By Grace Kim

Utilities have requested $23.1 billion in rate increases through the first three quarters of 2026, putting them on track to match last year's record of nearly $31 billion — and utility bills may decide the November midterms more than the fuel prices dominating headlines.

Record-breaking gasoline and diesel prices, driven by the Iran war and global refinery outages, have owned the campaign discourse. But electricity and natural gas bills led the nation in inflation before the war began, and they've fueled a backlash against AI data centers even though data centers are only partly responsible for rising bills in some regions, according to Charles Hua, executive director of the PowerLines nonprofit, which pushes to modernize utility regulation.

"This is no longer a boring, sleepy energy story," Hua said. "I cannot think of another election cycle prior to this 2026 midterm cycle where electricity and utility bills were on the ballot."

Positions from public utility commissioners to U.S. senators to governors hang in the balance, Hua said.

How fast are utility costs climbing?

U.S. electricity prices have risen roughly 40% on average over the last five years. The $31 billion in rate hike requests set in 2025 was nearly double the previous record.

The hikes track a spending surge. Investor-owned utilities raised their capital expenditure plans by more than 27%, to at least $1.4 trillion through 2030, up from $1.1 trillion a year ago, according to PowerLines — and that excludes privately held companies.

Past increases stem mostly from an aging grid, extreme weather and volatile fuel prices. Much of the future spending funds new power generation, in part for the AI data center boom.

"Data centers are putting significant pressure on the grid and whether or not, in any given electricity market or state, data centers are actually driving up electricity rates is a very nuanced conversation," Hua said. "Regardless of the reality, there certainly is a perception in most, if not all states at this point, that data centers could be driving up utility bills."

In short: the perception alone is now political currency.

What are consumers paying right now?

Heating oil jumped 74% in September from a year ago, nearly double gasoline's increase, just as residents start filling tanks for winter.

"This winter's spike in heating oil prices is going to hit families hard as heating season starts now," said Jamie Van Nostrand, policy director of the Future of Heat Initiative, which advocates for heat pumps. "A typical oil-heated home burns 500 to 700 gallons a year. At today's prices, that's $3,000 to $4,000, or 50% to 75% more than this time last year, landing on households already stretched by higher costs everywhere else."

At the pump, as of Friday:

• Regular unleaded averaged $4.33 a gallon, up 42% in 12 months — the first time gasoline has topped $4 in October.
• Diesel averaged $6.33 a gallon, up 73% in a year. Diesel had never exceeded $6 on average until this year.

Fuel prices aren't expected to climb substantially from here. Utility costs are a different story: many rate hikes remain pending, and a tough winter could push bills higher.

Where can ratepayers push back?

Consumers can't do much about pump prices, but they can fight utility rates through elected officials and the public utility commissions that approve the increases.

Nearly half of the $4.5 billion in third-quarter rate hike requests came from southern U.S. states, according to PowerLines. The single-biggest quarterly request came from Jersey Central Power & Light, which asked regulators for $700 million.

Some states have imposed data center moratoriums; others have rejected or reduced rate hikes. The White House pushed a non-binding "Ratepayer Protection Pledge" with hyperscalers to keep costs off consumers. States and commissions are also eyeing utility-scale batteries and virtual power plants — automatically cutting usage at peak demand, including from data centers — to squeeze more out of existing grid resources.

"Electricity politics are ratcheting up in terms of the pressure point," Hua said. "What was once a boring, sleepy issue where the PUC made decisions more or less in a vacuum is no longer the case. This is now a political issue."

With heating season starting and billions in rate requests still pending, the ballot box may be the next venue where utility bills get litigated.