Watch Out Plug-In Fans, Electric Rates are Going Up

The big potential of plug-in hybrid cars is that they’ll operate for long distances on electricity drawn from the home. That will save consumers pain at the pump, where prices are at record highs. But what happens when electric power sources see a price hike too?

That’s what’s predicted. The Energy Department says rates could rise 15% in 2008, the most in history. In contrast, last year they rose 2.3%. The price hike is due to the high price of coal, which fuels a majority of electric plants in the U.S. The high prices come from new international demand for the fossil fuel, even though it’s fairly abundant in North America. Other factors, like bad weather in coal-producing countries like Australia and China, are also fueling the spike for 2008, which may subside once those issues are resolved.

Some of the areas that will be hit hardest are places where electricity is derived almost exclusively from coal, including West Virginia and Kentucky. 

It looks like we’ll all have to get our calculators out once plug-in hybrids go on sale to see if we’re spending more at the pump or at the outlet.

Coal price hikes boost electric rates, more increases coming (ChicagoTribune)