January's Electric and Gas Rates

On February 13, January’s Consumer Price Index was reported. The overall CPI, for all goods and services, was up 3.1 percent as compared with a year earlier – January 2023. This follows the recent trend of moderate inflation.

The bellwether CPI for all items less food and energy was up 3.9 percent as compared with a year earlier. This stat has two components. Prices for commodities less food and energy commodities fell 0.3 percent year-over-year. While prices for services less energy services were up 5.4 percent. Including prices for shelter – such an important factor in inflation – which were up 6.0 percent, and transportation services, which were up 9.5 percent.

Food and energy prices are no longer driving inflation. Food prices were up only 2.6 percent. And energy prices were down 2.0 percent, also pulling downward the overall CPI.

The average price for utility natural gas service was down 17.8 percent as compared with a year earlier. The average price for utility electric service was up 3.8 percent. Which was notably more than the overall CPI increase of 3.1 percent, due to an unusual jump in January.

Utility services are a relatively small factor in the inflation index. Electric service prices are only one-forty-first of the overall CPI. Gas service prices are only one-hundred and forty-fifth of the overall CPI.  

How does all this affect affordability? Well, average weekly earnings were up 3.0 percent in January year-over-year. But since the overall CPI was up 3.1 percent, real average weekly earnings, that is, adjusted for inflation, were slightly down by 0.1 percent.