Most homeowners have felt the increased electricity prices on their monthly utility bills.
Many utility companies in Florida, including Florida Power & Light, Duke Energy Florida, Tampa Electric Co., and Florida Public Utilities Co., have increased their electricity rates in an attempt to recover the costs of hurricanes and the inflated gas prices that we witnessed in 2022.
The majority of public electricity in Florida is produced from gas. When gas prices go up as they did in 2022, it is inevitable that this will affect the price of electricity.
Likewise, hurricanes Ian and Nicole took a toll on the electric grid, and utility companies are retro-charging their customers to recoup the expense linked to hurricanes.
Most utility companies are spreading the costs across their customers in monthly installments and over several months, but homeowners and business owners are seeing significant increases in their electricity bills.
Electricity prices are unlikely to go down considerably in the future. Homeowners are looking into ways to minimize their monthly electricity bill and that’s where solar panels can really help.
Solar panels produce electricity on your roof so that you don’t have to buy it from your electricity company. Since solar power is free, renewable, and endless, solar panels are the perfect way forward for energy independence and lower electricity prices for your home and business.
Why Are Electricity Prices Going Up in Florida in 2023?
We have all noticed how almost everything has become more expensive, electricity included. When electricity increases, it affects all other costs. Supermarkets, bakeries, and businesses all use electricity to keep their products fresh, run the AC, and keep their business going. When electricity is expensive, they will have to pass on the cost to their customers.
Cost of the non-renewable sources
More than 75% of the electricity produced in Florida comes from natural gas. The price of natural gas has fluctuated immensely in the past months due to the war in Ukraine.
Many countries are switching from coal to natural gas as a source of electricity production. This has increased the demand for natural gas but supply hasn’t been able to keep up.
Also, a liquid natural gas storage facility in Texas had to be discontinued, which affected the availability of liquefied natural gas in the United States.
Hurricanes and natural disasters
Hurricanes Ian and Nicole battered Florida in 2022. Utility companies had to spend money and resources to put the utility grid back up. They are now seeking to recoup these expenses—which amount to $1.3 bn—by passing them on to their customers. Although the cost has been spread over several monthly installments, utility customers are likely to see increased bills throughout 2023.
How Much Are Electric Bills Going Up?
The electricity rates are going up significantly, depending on the utility company.
In general terms, electricity prices are going up from 8% to up to 13%—and more increases are forecast. The cost of 1,000 KW is expected to rise by 27 dollars. The average cost of 1,000 KW hovers around $120 for 2022 but is expected to rise to $140 and even to $170 for some utility companies.
While these increases might seem small at first glance, they accumulate. Florida is the third most energy-thirsty State in the United States after only Texas and California. Floridian households consume electricity to warm their homes but more importantly to cool them.
How to Minimize the Impact of the Electric Bill Increase in Florida
As Florida residents are bracing for consistently higher electricity bills, they are looking into their options. Solar panels are an easy, affordable, and reliable solution for electricity production.
Switching to renewable energy
When you install solar panels on your roof, you harness the power of the sun. Thanks to the inverters that are included in the solar panel system, this energy is turned into electricity and powers your whole house. Instead of buying electricity from your utility company, you are producing it on your own.
What’s more, with net metering you can sell the excess energy you produce to your utility company. During the day, when the sun is shining bright, the solar panels work at their maximum. If your home can’t consume all the electricity that’s produced, this electricity can be directed to the grid. Net metering calculates how much electricity you are returning to the grid. Based on these calculations, you will be reimbursed for the excess energy your roof produced.
When your solar panels lie idle during the night, you have to get your electricity from your utility company. Through net metering, though, the electricity you purchase is offset by the electricity you sell back to the grid. The final sum is what you pay, if anything, to your electricity company.
Thanks to the federal solar incentive, if you install solar panels today you can benefit from a 30% tax credit which lowers the overall installation cost significantly. Also, the State of Florida doesn’t charge sales tax on solar panels.
If the current electricity prices and the prospect of even higher prices terrify you, now is the time to switch to renewable energy and benefit from the endless and free energy of the sun.
Energy efficiency and conservation measures
Most of us try to save energy and become more energy efficient.
- You can switch off appliances and lights when you are not using them. The same stands true for the air conditioning when you leave the house.
- Don’t let doors and windows wide open as you lose heat or cool air.
- If you can, install LED lights, which are more energy-efficient than other light bulbs.
- Try to take quick showers rather than long baths. Long baths require more hot water, which means you use more electricity to warm the water.
- Slightly turn up your thermostat in summer. The most comfortable internal temperature is 78 degrees Fahrenheit. Even a couple of degrees can make a big difference in your electricity bill.
- Insulate your home so that you don’t have energy losses.
- Maintain your HVAC system for optimal function and minimal energy losses.
Will electricity prices go down?
It is unclear whether energy prices will go down. The markets for gas and petrol are highly volatile so predictions are risky. Most experts expect prices to remain high until 2024 and are uncertain about the way prices will go after that.
Solar panels can give you energy independence and they pay for themselves within 8 to 10 years, especially given the many federal and state tax incentives available. They are a good investment for your family and an excellent home upgrade as they increase your home value by up to 10%.
What uses the most energy in a home?
Cooling and heating account for almost 50% of your home’s energy consumption. While heating in Florida is relatively minimal, cooling is an absolute necessity that utilizes a lot of electricity.
Water heating is the next most important energy consumer in a home, followed by lighting. Based on these statistics, solar energy can significantly lower your energy consumption in your home.
Why are US electricity prices so high?
Throughout the US, there has been a surge in electricity prices due to increases in natural gas prices and the increase in demand after a couple of years when economic activity was subdued due to the pandemic.
Natural phenomena like hurricanes, storms, snow, and extreme heat are also taking their toll and affect not only energy consumption, but also the actual electricity grid.