Rising gasoline and electricity prices across the United States are reshaping the political landscape ahead of the November midterm elections, with candidates from both parties placing consumer affordability ahead of environmental and climate messaging.

According to S&P Global Market Intelligence, US residential electricity prices rose 7% in 2025 compared to 2024. Ratepayers in 46 states experienced year-over-year increases, with those in 12 states and Washington, DC, facing double-digit annual rate hikes. Driving these increases are rising energy costs, infrastructure improvements, extreme weather events, environmental mandates, and the energy-intensive expansion of data centers. The data-center buildout, fueled by the rapid commercialization of artificial intelligence and cloud-computing services, is accelerating at a time when US electricity demand — which had been essentially flat for nearly two decades — is climbing sharply again, placing new strain on generation capacity and transmission networks across multiple regions.

In the first quarter of 2026, Hawaii recorded the highest residential electricity rate at 43.91 cents per kWh, followed by California at 36.15 cents and New York at 32.63 cents. The national average stood at 18.70 cents per kWh.

"This climate-versus-fossil fuels framing of past cycles has given way to affordability [and] electricity price framing for both parties," said Scott Segal, head of Bracewell's Policy Resolution Group. While the shift toward affordability does not necessarily mean progressive Democrats are eager to bring natural gas-fired power plants to their states, Segal noted "there's a growing recognition that very strict environmentalist or climate change messages are not being proffered by most Democratic politicians, at least in the runup to this midterm election." The pivot comes roughly three years after the Inflation Reduction Act committed nearly $370 billion to clean energy and climate provisions — the largest federal climate investment in US history — suggesting that even amid unprecedented federal support for decarbonization, voter priorities at the state level are being driven by pocketbook concerns.

The war in Iran has pushed oil prices higher, and with them US gasoline prices, which are now nearly $1 per gallon more nationwide than a year ago, according to AAA. In Alaska, where gasoline averaged $4.27 a gallon on July 28 — making it the fourth most expensive state — the incumbent Republican candidate is calling for increased domestic oil production to offset price impacts tied to the conflict. The Democratic challenger argues that the war is driving costs higher and that, as an oil-producing state, Alaskans "should be benefiting from that at the pump, not footing the bill for endless wars."

A notable energy pragmatism is emerging across the country, pushing candidates away from their traditional talking points. S&P Global observes that incumbent Democratic governors are adopting an all-of-the-above approach, embracing diverse fuel sources that include natural gas alongside nuclear and renewable power to meet rising demand.

This trend, however, is not uniform nationwide. In some states like Colorado, incumbent Democrats faced strong pushback in their primaries for being perceived as more open to fossil fuels. In Connecticut, the incumbent Democrat views natural gas as the state's dominant fuel source for the foreseeable future, while the Republican challenger blames carbon-free policies for driving up costs.

California presents a striking shift for the country's greenest state. Sixty percent of California voters say they are unwilling to pay more for renewables, with 96% of those respondents citing the cost of energy as a problem. In the gubernatorial race, the Democratic candidate emphasizes affordability over climate goals and has declined to commit to phasing out gasoline-powered cars by 2035. The Republican candidate wants to end the state's renewable portfolio standard and renewable energy credits, arguing that gas, nuclear, and rooftop solar should compete on a level playing field.

Data centers have become a flashpoint in the affordability debate, as voters increasingly blame the facilities — which require massive amounts of power and water — for rising electricity bills. S&P Global notes that candidates' positions on data-center development, including proposed moratoriums in some cases, could directly affect their electoral prospects in local, state, and federal campaigns.

A 2026 Politico national survey cited by Brookings found that nearly half of Americans expect data-center energy costs to become a campaign issue. A separate 2026 Pew Research Center poll found that 38% of respondents viewed the overall impact of data centers on home energy costs as mostly negative, compared to just 6% who saw it as mostly positive. The Pew poll also revealed partisan differences: Republicans generally held more favorable views of data centers, seeing them as valuable economic development tools and less environmentally damaging than Democrats did.

At the state level, opposition to data-center construction is mounting. In Texas, 55% of voters oppose new data-center builds, even as the state has 32 gas-fired power projects proposed. The Utah governor has mandated a new transparency framework and renewable power requirements for data centers, while Florida frontrunners agree the facilities need stricter regulation. Two counties in Maryland have imposed data-center construction moratoriums.

Brookings reported that analysts in Virginia and New Jersey attributed Democratic victories in 2025 to the tough stances gubernatorial candidates took against data centers. Conservatives have echoed these concerns; Florida Governor Ron DeSantis backed an AI bill of rights aimed at protecting consumers from AI-related risks and shielding them from the electricity costs associated with data centers.

As the 2026 cycle progresses, candidates from both parties are railing against rising rates and assigning responsibility to wealthy tech companies and the energy demands of their data centers. Electoral aspirants are leveraging public anxiety over artificial intelligence and a broader "techlash" against large digital firms to appeal to voters and push for stricter legislation. In Virginia, the state Senate recently passed a budget bill that would eliminate a $1.6 billion tax break for data-center equipment — a clear signal of the shifting political climate for developers. Grid operators including PJM Interconnection, which serves more than 65 million customers across 13 states and Washington, DC, have warned that data-center-driven load growth could strain reserve margins in coming years, adding urgency to debates over who pays for new generation and transmission.

With electricity costs at the forefront of public concern, the issue is poised to dominate campaign dialogue this year and may well determine which candidates prevail at the polls.

By Andrew Topf for Oilprice.com