Figure 2. In 2023, average wholesale electricity prices varied strongly by region. Shown are annual average real time electricity market prices based on data from all locational marginal p ce nodes in 2023. Energy Markets & Policy Berkeley laboratory
Figure 1. Average wholesale electricity price declined in 2023 compared to 2021 and 2022. Average prices are calculated based on all nodes and hours within each of the 7 major ISOs/RTOs, and represent hourly average prices in the real time markets.Figure 1, available from ReWEP, shows the average price in 2023 was $36/MWh, down from $63/MWh in 2022. One driver of declining prices was the declining cost of natural gas.
High wholesale electricity prices in ERCOT and CAISO were driven by different phenomena. In CAISO, high annual prices in 2023 were driven mostly by the high hourly prices in January 2023. In contrast to CAISO, high annual prices in ERCOT in 2023 were driven by high afternoon and early evening prices in June through September . These high prices were driven by record high electricity demand . Both CAISO and ERCOT pricing patterns are discussed further in the full brief.