Electricity costs have been rising across North America, and for many businesses, the increase has been sharp, unexpected, and difficult to explain.

If your energy bill went up this year, you’re not alone. Commercial and industrial energy users across Canada and the United States have experienced significant cost increases driven by a combination of market, infrastructure, and policy factors.

Understanding why prices are rising is the first step to controlling them.

Energy Prices Are Rising: Here’s What the Data Shows

Across North America, electricity prices have trended upward since 2020, with noticeable acceleration in the past two years.

  • In the United States, average retail electricity prices have steadily increased, with double-digit percentage growth in several states since 2020.
  • In Ontario, forward market prices and capacity-related costs have risen significantly, driven by supply constraints and growing demand.
  • Across Canada, many large energy users have seen substantial year-over-year increases depending on region, contract structure, and consumption patterns.

This isn’t a short-term spike, it reflects a broader structural shift in how energy is produced, delivered, and priced.

What’s Driving Higher Electricity Costs?

Several key factors are pushing energy prices higher:

1. Aging Grid Infrastructure

Much of North America’s energy infrastructure is decades old and requires major investment. These upgrade costs are ultimately passed on to ratepayers through higher delivery and capacity charges.

2. Growing Demand for Electricity

Electrification is accelerating: electric vehicles, data centers, and industrial electrification are all increasing demand on the grid. Peak demand is rising faster than supply in many regions.

3. Volatile Fuel Markets

Natural gas prices, which heavily influence electricity generation costs in many markets, have remained volatile. Global energy disruptions continue to impact local pricing.

4. Cost of New Generation

Building new energy supply, whether renewable, nuclear, or natural gas, is expensive. While necessary for long-term stability, these investments increase costs in the short to medium term.

5. Capacity & Reliability Costs

In markets like Ontario, businesses aren’t just paying for energy, they’re paying for the grid’s ability to deliver power during peak demand. These capacity-related charges have become a major driver of rising bills.

Why This Matters for Your Business

Energy is often one of the largest operating expenses that businesses don’t actively manage.

But in a volatile market, timing and strategy matter more than ever.

The difference between:

  • locking in a contract at the right time
  • versus passively renewing at market peaks

can mean tens of thousands of dollars in avoidable costs over the term of an agreement.

When prices are moving quickly, inaction becomes expensive.

How to Take Control of Your Energy Costs

The good news: rising prices don’t mean you’re powerless.

Businesses that actively manage their energy strategy can:

  • improve cost predictability
  • reduce exposure to market spikes
  • align contracts with favorable market conditions
  • gain visibility into what they’re actually paying for

Work With Experts Who Understand the Market

At MPN Capital Markets, we help businesses across North America navigate complex energy markets with clarity and confidence.

From contract timing to pricing strategy, our approach focuses on:

  • better visibility
  • better decision-making
  • and better outcomes

If your energy costs increased this year and you’re not sure why, it’s worth a conversation.