Since President Biden took office in 2021, energy prices have surged by more than 30%, adding to the strain of persistent inflation on American consumers. The latest Consumer Price Index (CPI) report from the Labor Department highlighted gasoline and housing expenses as the primary drivers behind a 0.4% increase in March. This rise of 3.5% compared to the previous year exceeded economists’ forecasts and pushed oil prices to a five-month peak. Greg McBride, Bankrate’s chief financial analyst, expressed concern, stating, “We are not seeing any improvement; the situation is worsening.” He pointed out ongoing challenges in areas like housing, car insurance, maintenance, and service costs, with electricity costs also rising by 0.9% in March and 5% over the past year.
Tuesday’s inflation data underscores the challenging situation faced by energy consumers over the past three years. The Department of Labor’s Bureau of Labor Statistics reports that the overall cost of energy in March has surged by 36.9% compared to January 2021.
Across all energy categories, prices have risen significantly since three years ago. For instance, electricity prices have increased from $0.14 per kilowatt-hour in January 2021 to $0.17 in March 2024, marking a 28% uptick.
Gasoline prices in the United States skyrocketed to record levels in 2022 due to disruptions in international oil production caused by the conflict between Russia and Ukraine. Although prices have since decreased, the cost of gas remains significantly higher, with a 52.1% increase compared to when President Biden took office. On January 18, 2021, the average price per gallon was $2.38, and it has now risen to $3.62, as reported by the Energy Information Administration.
Similarly, diesel prices have also surged, rising by 50.4% over the past three years. In January 2021, the cost was $2.70 per gallon, while today it stands at $4.06 per gallon.
In his bid for re-election in 2024, Biden has focused on addressing the increasing energy costs by increasing government investment in clean energy solutions. The Inflation Reduction Act of 2022 allocated $369 billion towards initiatives labeled by Democrats as “Energy Security and Climate Change,” providing significant incentives and tax benefits aimed at achieving a 40% reduction in carbon emissions by 2030. To offset these expenses, the law introduced a new 15% Corporate Minimum Tax and allocated additional resources to the Internal Revenue Service to combat tax evasion.
The White House revealed on Friday that the Environmental Protection Agency will allocate $20 billion from the IRA to support nonprofits funding numerous clean energy initiatives nationwide. The administration has also pledged to eliminate coal power plants across the country, aligning with 56 other countries in the Power Past Coal Alliance.
Furthermore, a recent analysis by the Wall Street Journal highlighted that the Biden administration has issued fewer leases for oil and gas drilling on federal land and offshore compared to any other presidency since World War II.
Critics argue that the president’s focus on clean energy is disconnected from reality, citing Tuesday’s CPI report as proof that the Inflation Reduction Act has not succeeded. According to Daniel Turner, founder and executive director of Power the Future, a prominent energy industry organization, the law championed by Joe Biden and his supporters was hailed as the largest green energy funding initiative ever, but has only resulted in higher prices across various sectors. Turner further stated that since assuming office, Joe Biden has persistently pursued a policy agenda that lacks practicality and directly impacts the wallets of all Americans.
In spite of President Biden’s efforts to promote clean energy, rising inflation prompted him to take action by tapping into the Strategic Petroleum Reserve (SPR) in late 2021 to address soaring fuel costs. Additionally, in 2022, the president visited Saudi Arabia to request OPEC nations to boost oil production.
Recently, the Biden administration scrapped a plan to purchase up to 3 million barrels of oil to refill the SPR due to escalating oil prices.
Daniel Turner remarked, that under Joe Biden’s leadership, American households are facing financial challenges related to energy costs, which have nothing to do with an eclipse. Consumers are bearing significant expenses at gas stations and on their electricity bills, while the president’s response consists of ineffective measures like depleting the SPR, seeking additional oil from Saudi Arabia, and shifting blame for his shortcomings onto Russia.
