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Forecasts are directionally accurate (prices will likely increase 5-15% rather than decrease 10%) but range of outcomes is wide. Unexpected events (severe weather, geopolitical disruptions, economic shocks) can cause forecasts to miss by ±5-10%. Use forecasts for scenario planning, not precise budgeting. Plan conservatively for high side of range.
Ohio Energy Price Forecast 2026: What to Expect for Your Utility Bills
What will your Ohio energy bills look like in 2026? Forecasting electricity and natural gas prices requires analyzing multiple converging factors: wholesale market trends, capacity dynamics, fuel costs, regulatory changes, and infrastructure investment. This forecast examines realistic scenarios for 2026 pricing and helps you prepare financially and strategically.
The 2025-2026 Market Outlook: Key Drivers of Ohio Energy Pricing
Several major factors will influence 2026 electricity and natural gas prices for Ohio customers.
Forecast Drivers
- Wholesale Prices: Current PJM wholesale electricity averaging $40-60/MWh; natural gas $2.50-3.50/MMBtu; both likely to moderate slightly in 2026 as new supply comes online
- Capacity Charges: 2025-2026 PJM capacity auctions already priced; expect 5-10% moderation if Trumbull and other projects enter service as planned
- Transmission/Distribution: Utility infrastructure investments continuing; delivery charges rising 2-3% annually regardless of commodity prices
- Renewable Integration: Increasing wind/solar penetration; maintaining grid reliability costs money (backup capacity, storage); adds 0.5-1.5¢/kWh system costs
- Inflation/Fuel Costs: Labor and equipment costs elevated; maintenance/operations costs rising 2-4% annually across utilities
- Regulatory Actions: Potential PUCO rate case decisions, utility surcharges for specific costs (infrastructure, coal ash, weather events) could add 1-3% to bills
Combining these factors produces 2026 forecast scenarios ranging from optimistic to conservative.
| Scenario | Electricity Price (all-in) | Natural Gas Price | Probability | Bill Impact vs 2024 |
|---|---|---|---|---|
| Optimistic | $0.100-0.110/kWh | $2.50-3.00/MMBtu | 20% | -2% to +3% (moderation or flat) |
| Base Case | $0.110-0.125/kWh | $3.00-3.50/MMBtu | 55% | +5% to +12% (moderate increase) |
| Conservative | $0.125-0.140/kWh | $3.50-4.00/MMBtu | 20% | +12% to +20% (significant increase) |
| Worst Case | $0.140-0.160/kWh | $4.00-5.00/MMBtu | 5% | +20% to +35% (severe spike) |
Electricity Price 2026: Components, Drivers, and Bill Projections
Ohio electricity bills contain multiple components, each with distinct 2026 outlook:
Commodity Energy Price
2024 Baseline: $0.035-0.045/kWh wholesale. 2026 Forecast: $0.038-0.050/kWh (flat to +10%). Driver: Moderate fuel price, new generation capacity balancing retirements. Impact: +2% to +5% on energy portion of bill.
Delivery/Distribution Charges
2024 Baseline: $0.035-0.045/kWh from utilities. 2026 Forecast: $0.038-0.050/kWh (consistent +2-3% annually). Driver: Grid modernization, system resilience investments. Impact: +2% to +3% on delivery portion.
Demand/Capacity Charges
2024 Baseline: $5-15/kW depending on season. 2026 Forecast: $5-12/kW (5-20% decrease if Trumbull online). Driver: New capacity reduces PJM auction prices. Impact: -3% to +2% on demand component for commercial/industrial.
Ancillary/Regulatory Charges
2024 Baseline: 2-3¢/kWh from various surcharges. 2026 Forecast: 2.5-3.5¢/kWh (flat to +10%). Driver: PUCO decisions, utility cost recovery. Impact: +0.5% to +2% on ancillary charges.
Total Electricity Bill Forecast
Residential Customer: Current $120/month → 2026 projected $128-140/month (+7% to +17%). Commercial Customer: Current $2,000/month → 2026 projected $2,100-2,340/month (+5% to +17%). Base Case (55% probability): +8-12% total increase.
Competitive Rates Advantage
Competitive suppliers typically track wholesale prices closely. If wholesale prices increase 5%, competitive rates increase ~5%. Utility default rates may increase more due to delivery/regulatory charges. Staying with competitive suppliers helps moderate 2026 rate shock vs. utility default rates.
Strategic Preparation: Locking in Favorable Rates Before 2026 Price Increases Materialize
Understanding 2026 forecast helps inform procurement strategy today:
Strategy 1: Lock Multi-Year Contracts Now
If current wholesale prices are favorable (near or below $50/MWh), locking 24-36 month contracts captures current pricing before anticipated 2026 increases. Contracts locked December 2024/early 2025 can capture 8-12% savings vs. waiting for 2026 renewal.
Strategy 2: Shift to Efficiency Investments
Invest $1,000-5,000 in efficiency (LED lighting, HVAC maintenance, controls, insulation) before 2026. Efficiency ROI of 20-40% annually looks increasingly attractive as rates rise. A $3,000 investment reducing consumption 15% saves $1,500-3,000 annually forever, becoming more valuable as rates climb.
Strategy 3: Budget for Increases
Plan for 8-12% electricity bill increase (base case) in 2026 budgets. Factoring this into financial forecasts prevents surprises. For businesses with energy-sensitive operations, 8-12% cost increase materially impacts profitability planning.
Strategy 4: Prepare Demand Flexibility
As prices increase, demand response and load shifting become more valuable. Prepare operations/processes that can shift to off-peak hours or reduce during peak periods. This positions you to capture demand response revenue ($200-5,000 annually) as programs expand in response to tighter markets.
Action Timeline: Lock competitive rates by Q2 2025 to capture favorable 2025 pricing before 2026 increases. Implement efficiency projects Q3-Q4 2025 to maximize 2026 benefit. Finalize 2026 budget with +8-12% energy cost assumptions by Q4 2025.
2026 Price Forecast FAQs
Yes, optimistic scenario (20% probability) shows prices flat to -2%. This could occur if wholesale markets weaken (economic slowdown, renewable build-out faster than expected, natural gas prices collapse). However, base case (55% probability) remains most likely: +8-12% increase. Plan for base case, hope for optimistic outcome.
Yes, switching now captures competitive rate discounts before market tightens. Competitive rates typically run 10-25% below utility default. Switching now and locking 24+ month contract captures current discounts for entire 2026-2027 period, providing substantial savings as utility default rates rise.
Natural gas and electricity prices generally move together but with different magnitudes. Forecast shows natural gas +3-8% in 2026 vs. electricity +8-12%. Electricity increases more because of capacity charges and delivery/regulatory components. Natural gas tracks commodity prices more directly.
Most utilities don't offer prepayment discounts. Better approach: lock fixed-rate contracts through suppliers. Fixed rates effectively "prepay" you by locking prices for full contract term. 24-36 month fixed contracts are better prepayment strategy than actual cash prepayment (which earns no discount).
Prepare Your Budget for 2026 Energy Costs
2026 will likely bring 8-12% electricity rate increases. Taking action now—locking favorable rates, investing in efficiency, and planning budgets—positions you to weather the transition smoothly. Passive approach risks bill shock and financial surprises.
Prepare for 2026 energy price increases now.