Friday’s GDP data: now 11 months in a row where electric bills have been 1.5% or less of personal expenditures.
Good news this Monday morn. You probably saw Friday the Commerce Department's announcement about the nation's Gross Domestic Product, the GDP. Buried in the many numbers used to figure out the GDP, electric bills were just 1.4 percent of personal consumption expenditures.
Over two-thirds of the GDP is spent by and for individuals and families. These personal expenditures amount to a big number, more than twelve and a half trillion dollars.
Our electric bills run us nearly one hundred and seventy six billion dollars. Still a big number. But small in comparison to households' purchases of all goods and services.
For the past 11 months in a row, March 2015 through January 2016, electric bills have been 1.5 percent or less of these expenditures. Does this suggest we're in another era of cheap electricity?
Households' electric bills as a percentage of their expenditures were at an all-time historic low during the first years of this century. And that says a lot, since the data goes all the way back to the nineteen fifties.
Electricity was no greater than 1.5 percent of personal expenditures for 23 months in a row from April 2001 through March 2003. Then after a one-month blip, electricity was no greater than 1.5 percent for another 27 months in a row from May 2003 through July 2005. It was the golden age of cheap electricity.
That's a tough streak to top or equal. January 2016 was the 11th month where electricity has been no greater than 1.5 percent of expenditures. We'd have to keep up the streak for another dozen months to compete with those good times of the early 2000's.
Though, when you consider how close our current numbers are to the golden age of cheap electricity, and our increased dependence on electricity, you might say this is a second era of cheap electricity. After all, our homes, workplaces and schools and the businesses that serve us are much more saturated with electrical devices than just ten to fifteen years ago.
Number-crunching courtesy of the magazine for commentary and opinion on utility regulation and policy, Public Utilities Fortnightly.
Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
E-mail me: mitnick@fortnightly.com
