Why Cheap Energy Can't Reach Us Yet

Why Cheap Energy Can’t Reach Us Yet The Thread · Issue #8 · July 13, 2026You keep hearing energy is getting cheaper, but your bill only climbs. Both are true — and the gap between them is the whole story. This issue takes an electric bill apart: why the cost of making power has collapsed to the cheapest in history, why that’s the one part of your bill behaving, and why the real climb is in the wires and the fire. It ends where the hope is — cheap local power, batteries, and what all of it lets us do next.ChaptersEstimated — will refine after audio QC.0:00 — Open0:30 — Ray, and the bill that keeps climbing2:00 — The cheapest power we’ve ever made4:30 — So cheap it goes negative (and gets spilled)6:30 — The fear that quietly faded8:00 — Two things sharing one bill: generation vs. delivery10:30 — Wires and fire13:00 — Both things are true14:30 — What cheap power lets us do next: remote grids, batteries, Australia17:30 — So what do you do with thisSources and further readingLazard, cost of building new power by source (solar/wind cheapest for the tenth year; new gas at a ten-year high):https://www.lazard.com/research-insights/levelized-cost-of-energyplus-lcoeplus/Our World in Data, long-run collapse in solar panel prices:https://ourworldindata.org/cheap-renewables-growthNegative wholesale prices in Southern California (~1,180 hours in 2024):https://resurety.com/article-negative-prices-in-caiso/EIA, California curtailed 3.4 million MWh of wind and solar in 2024 (93% solar), and the solutions:https://www.eia.gov/todayinenergy/detail.php?id=65364Haas / Energy Institute at UC Berkeley, generation is a minority of a California bill:https://newsroom.haas.berkeley.edu/research/report-reveals-inequity-in-electricity-pricing-calls-for-rate-reform-to-help-fight-climate-change/Severin Borenstein on why California rates are high (delivery, not generation):https://www.energysage.com/news/ca-electricity-rates-increase-96-percent-2014-to-2024/EIA, California residential electricity price (~35 cents/kWh):https://www.eia.gov/electricity/monthly/California rates up ~40% since 2019, steepest in the nation (Energy Institute at UC Berkeley):https://www.edhat.com/california/news/california-sees-nations-largest-electricity-rate-increase-up-39-since-2019/Wildfire as a growing share of a California utility’s costs:https://www.solarwithwatts.com/eds-blog/why-is-electricity-so-expensive-in-californiaSCE rate advisory (wildfire self-insurance):https://www.sce.com/save-money/rates-financing/sce-rate-advisoryIEA, rising cable and transformer prices:https://www.iea.org/news/rising-component-prices-and-supply-chain-pressures-are-hindering-the-development-of-transmission-grid-infrastructurePowerMag, transformer demand and shortages:https://www.powermag.com/transformers-in-2026-shortage-scramble-or-self-inflicted-crisis/Yale E360, PG&E remote grids replacing fire-prone lines:https://e360.yale.edu/digest/microgrids-power-linesT&D World, the Briceburg remote grid through a 2021 wildfire:https://www.tdworld.com/distributed-energy-resources/article/21278234/pge-remote-grid-delivers-wildfire-safety-and-ratepayer-savingsCAISO, California battery storage growth (2020–2025):https://www.caiso.com/documents/2024-special-report-on-battery-storage-may-29-2025.pdfClean Energy Council, Australia rooftop solar at scale:https://cleanenergycouncil.org.au/news-resources/rooftop-solar-and-storage-report-july-to-dec-2025Read the full pieceThe written edition, with every source linked inline: https://matthewgdavis.substack.com/About The ThreadThe Thread is a biweekly essay by Matthew Davis, co-founder of Sherwood Financial Partners, following the connections between the economic forces and the everyday financial decisions they shape. One thread per issue, pulled slowly, from what you’re feeling about money back to the systems underneath it.Compliance disclosureThe full compliance disclosure for this episode is available with the text of this post, at matthewgdavis.substack.com. This briefing is for informational purposes only and does not constitute investment advice. Always consult with your financial advisor before making investment decisions. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit matthewgdavis.substack.com