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The price of electricity is based on the production costs of generation. Some generation fuels consist of oil, coal, natural gas. Depending on the costs of these fuels relates directly to what you as a consumer will be charged. My electricity is supplied from a hydro electric dam which is one of the least expensive methods of production. I pay .07 cents a kilowatt hour.

Added by JL--

Depends on the state that you live in... For example, in Texas in 2011, average rates were around 11 cents/kWh, but that also was dependent upon the contract length. I had a 6 month contract for about 8.5 cents/kWh.

Source:

U.S. Energy Information Administration

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