The New Affordability Equation

David Fleming
Marketing Director, GridX

First Published Q3 2026

For most customers, affordability is not experienced through a rate case, a grid plan, or a demand forecast, it’s experienced through their bill. That makes the bill one of the clearest ways customers experience a rapidly evolving energy system.

It is where infrastructure investment, rate design, customer usage, new sources of demand, and policy decisions all show up together. It’s also when customers decide if the story they are being told about the energy transition matches what they are being asked to pay.

For utilities, that puts the customer bill at the center of a delicate balancing act. They need to keep investing in the grid to support reliability, electrification, and new load growth, but every investment, rate change, and customer program now must pass a clear test: what does it do to the customer bill, and can that impact be explained and defended?

Passing that test requires more than bill support after a customer is already struggling to pay, or advice aimed at helping customers use less energy. While those actions have a role, they won’t solve the deeper challenge.

Affordability Pressure Is Real

The pressure on customers is already very real. The J.D. Power January 2026 Utilities Intelligence Report noted that average monthly electric bills reached $189 in 2025, up 34% since 2020. Higher bills are of course frustrating, but the more worrying part is that a sizable number of customers are struggling to pay them. The report indicated that 22% of electric utility customers said they could not pay their full bill or currently had an outstanding balance.¹

By the time a customer is struggling to pay the bill, addressing affordability is already too late. So affordability needs to be considered earlier, in how rates are designed, how customer impacts are modeled, how programs are targeted, and in understanding how all of that translates into what customers will see on their monthly bill.

Investment Still Has to Happen

Meanwhile, utilities need to invest in reliability and resilience, especially as electrification, AI and data centers, as well as other large loads, place new demands on the grid. And while significant investment is essential to build out the future grid, it still has to be paid for and explained to customers already under pressure.

Part of that pressure comes from the age of the grid itself. As older, largely depreciated infrastructure is replaced, those costs move back onto customer bills.² That makes decisions about what to replace, when to replace it, and how to make better use of existing grid capacity even more important. This is what makes addressing affordability such a difficult issue.

While some costs can be avoided or deferred, and some can be shifted through better use of demand flexibility, others simply have to be recovered. The hard part for utilities is deciding what can move, what cannot, and making sure those trade-offs can be understood when they reach the customer.

Making the Bill Useful

If the bill is where all of this becomes real, then it needs to do more than just record charges after the fact. It should help customers understand why their costs have changed, what options are available to them, and how any changes they make could affect what they will eventually pay.

In simple terms, this is what the bill of the future should do. But of course, saying that and delivering it are two different things. That could mean clearer charge breakdowns, plain-language rate explanations, month-over-month comparisons, bill forecasts, targeted guidance, and QR codes that connect customers to more interactive digital experiences.

The bill is becoming more complex at the same time as customers need it to be clearer. With time-varying rates, demand response programs, EV charging plans, solar credits, and low-income programs all creating more opportunities to manage costs, it’s easy to understand why customers can feel overwhelmed. But if the bill can make these opportunities easier to understand, then they can become a source of control rather than confusion.

For the bill of the future to play this role, the information behind it needs to be accurate enough for customers to trust and useful enough for them to act on it. Utilities need to be able to model customer-level impacts before a rate or program is launched, calculate those impacts accurately once they are live, and explain the result in a way customers can understand. Without that customer-level view, even well-designed affordability measures can get lost somewhere between what the utility intended and the bill that arrives at the customer’s door.

From Rate Design to the Bill

To avoid this happening, planning, rate design, customer analysis, program delivery, and billing cannot sit in separate lanes. They need to be connected by systems that can carry decisions all the way to the bill. It’s vital that those decisions are understood and measured at the customer level, because if not, the utility may know what it is trying to achieve but still struggle to prove the impact for each customer.

The need for utilities to have customer-level visibility is becoming more urgent as investment pressures rise. S&P Global Market Intelligence reported that utility capital investment across 47 tracked energy utilities was forecast to reach about $214 billion in 2025, while electric utility rate increase requests reached $18.23 billion.³

The more pressure there is on investment and rate recovery, the more important it becomes for utilities to understand who will be affected, how costs and savings will impact customers, and where different rate or program decisions may create better outcomes before they become part of the bill.

Technology has a key role to play in managing these pressures. While the judgment calls sit with utilities, technology can help connect the decisions, data, and calculations that determine what customers will see on their bill.

That rate-to-bill challenge is central to how we think about affordability at GridX. Decisions made in rate design, customer analysis, and program strategy all need to show up accurately in the bill a customer receives. Our platform is designed to help utilities connect that work by testing different rate and program designs, identifying likely customer impacts, affordability risks, and savings opportunities, calculating complex charges accurately, and carrying that logic through to the bill.

The value of this joined-up view is that utilities can explore the potential impact before a rate or program goes live. They can move beyond broad averages and have more informed conversations internally and with regulators about which customer groups are likely to benefit, where affordability risks may emerge, and where a design change could help avoid unnecessary pressure on bills. Once a program goes live, the same detailed analysis can support customer communication, making it easier to explain what has changed, what targeted options are available, and where there may be opportunities to reduce costs before bill shock or a loss of trust sets in.

The bill of the future has a practical role to play here, but it should not be treated as the only customer touchpoint. It can act as a gateway into more connected digital experiences, where the same analysis can support rate explanations, bill comparisons, forecasts, targeted guidance, and other interactive tools that help customers manage costs more continuously. In that way, the bill gives customers a clearer view of what is happening, while helping utilities connect the decisions behind the bill to the charges, options, and guidance customers actually see.

The new affordability equation is clear: utilities need to invest in the grid, and customers need confidence that the cost of that investment is being managed fairly. The bill is where those two realities meet.

For affordability to remain credible through the next phase of the energy transition, it must be designed in earlier, calculated more accurately, explained clearly, and ultimately proven through the bill customers receive.

Sources

¹ J.D. Power, Utilities Intelligence Report, January 2026 https://www.jdpower.com/business/resources/utilities-outlook-2026
² With Great Power podcast, Alice Yake on Building the Grid of Tomorrow, August 2026. Discussion from approximately 18:26 https://gridx.com/with-great-power-season-7-episode-1/
³ S&P Global Market Intelligence, Record amount of utility rate requests in 2025 amid affordability concerns, January 2026 https://www.spglobal.com/market-intelligence/en/news-insights/research/2026/01/record-amount-of-utility-rate-requests-in-2025-amid-affordability-concerns