Governors Target High Energy Costs, Tout Affordability Efforts

US governors are kicking off 2026 with a focus on affordable energy as Americans grapple with higher electricity costs and utilities across the country are eyeing billions of dollars more in rate increases.

Among them are newly elected Govs. Mikie Sherrill (D) of New Jersey and Abigail Spanberger (D) of Virginia, both of whom entered their respective governors’ offices this year and homed in on energy affordability in their recent addresses after raising it on the campaign trail.

Sherrill, in her inaugural address, announced her first two executive orders, both focused on energy. The first gives the state public utilities board the authority to halt utilities’ rate hike requests. The second directs that same board to open solicitations for solar and storage projects.

“This is just the beginning,” Sherrill said. “We are going to take on the affordability crisis, and we’re going to shake up the status quo.”

Last year, investor-owned gas and electric utilities requested roughly $31 billion in rate increases combined, more than double the year prior, according to a report released Thursday by PowerLines, a nonprofit organization that pushes for lowering people’s utility bills and system modernization.

Americans haven’t felt the impacts of a lot of those requests yet, but according to the organization’s polling, almost two-thirds said their monthly electric and gas utility bills rose from a year earlier. Roughly the same portion of people also said those bills are making them more financially stressed, according to the organization’s report.

Governors are zeroing in on energy affordability as Americans are still grappling with ongoing inflation across the board.

“The level of political interest and engagement among elected officials and policymakers and politicians is skyrocketing,” PowerLines founder and executive director Charles Hua said.

Rising Rate Requests

As ratepayers watch electricity prices rise, politicians and others have been quick to tie the increases to the proliferation of data centers. But it’s not so straightforward, Hua cautions. PowerLines attributes the increase in Americans’ utility bills to several components: the need to replace old infrastructure, extreme weather-related expenses, fuel costs, and in some instances, higher electricity demand.

In his state of state address earlier this month, Indiana Gov. Mike Braun (R) also brought up electricity prices, noting how he appointed an official consumer advocate “to hold the line on utility price hikes.”

“The first time a request came to her asking for a rate increase, she responded with a recommendation for a decrease,” Braun, a former US senator, said in his speech.

Braun also said he supports a bill proposed in the state legislature that would regulate investor-owned utilities’ profit margins, and he said he named three “rate-payer conscious members” to the state’s regulatory body for utility companies.

An Array of Solutions

While governors from various parts of the country have raised the issue of energy affordability, how they aim to tackle the issue runs the gamut because what’s driving the increase in prices varies depending on location, said Warren Leon, executive director of the Clean Energy States Alliance. While California is dealing with impacts from wildfires and trying to fortify its electricity network, Virginia is facing a proliferation of data centers, he said.

“The solution is different in different parts of the country,” Leon said.

Virginia’s Spanberger, in her first address to the state’s General Assembly, said there are things the state can do to reduce energy costs, including boosting energy storage and expanding energy-efficiency programs. She also said Virginia would rejoin the Regional Greenhouse Gas Initiative, a multi-state market that requires power plant companies to buy allowances to cover their emissions with the profits going to the states.

“Withdrawing from RGGI did not lower energy costs,” Spanberger said. “In fact, of course the opposite has happened—it just took money out of the pockets of Virginians. And so it is time to fix this mistake.”

The state has oscillated in recent years on its participation in the program, which, under former Gov. Glenn Youngkin (R), the Virginia Air Pollution Control Board voted to leave. The courts struck down the move.

Arizona Gov. Katie Hobbs (D) earlier this month said the state would create a fund, starting with $20 million, to assist families with paying their utility bills, weatherizing their homes to lower those bills, and construct cheaper housing. To pay for that fund, Hobbs proposed implementing a fee on short-term rentals.

In New York, Gov. Kathy Hochul (D) said the state “can make energy more affordable and reliable while still leading the nation in sustainable investments.” The governor also took aim at data centers, saying “they guzzle up tremendous amounts of energy and leave ratepayers footing the bill.”

“If they want to build in New York, they have to pay their fair share for the power they use,” she added, saying they need to independently produce their own power.

A Nonpartisan Problem

Governors of both parties have banded together to take on energy affordability. More than a dozen of them, who all have constituents within grid operator PJM Interconnection’s network, recently signed a joint statement with officials from the Trump administration calling on PJM, in part, to protect consumers from capacity-driven price increases.

PowerLines’ Hua said electricity affordability is an issue for voters on both sides of the aisle, and they want to see their elected officials take action.

“They’re recognizing that their governors play a key role in that. But it’s not just the governors; it’s also state legislators and even state attorneys general,” Hua said.