NYC Relies on Electric Grid for Tax Revenue

A Manhattan Institute report finds New York City draws more tax revenue from its electric grid than any other major U.S. city.

Updated on Nov. 2, 2026 in Utilities

Bold vector editorial illustration of a steel utility pole on a stone plinth, with black cables sweeping between brick building facades under a pale sky. — Con Ed passes a property tax on its New York City wires and equipment to customers without itemizing it, making the city the largest U.S. grid-tax earner, a Manhattan Institute report finds. AI Illustration. Upload story photo >

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Should New York City stop collecting taxes through residents' electric bills?

New York City's policies add an effective 36% to 43% tax to electricity delivery, the largest share of which is a property tax charged to Con Ed on its wires and equipment. Con Ed passes that cost to customers without itemizing it on electric bills.

Why it matters

The tax burden is largely hidden from residents, which the Manhattan Institute suggests is why the arrangement has persisted. A new state agreement on bill transparency aims to make the charge visible to New York City customers.

Con Ed's city property tax bill grew from $1 billion in 2015 to $2.1 billion in 2025, while New York City collects about 8 cents per kilowatt-hour compared with about 1 cent in Chicago and Washington, DC. It remains unclear whether the state will allow the city to raise its electricity sales-tax rate to partially replace lost revenue.

The players

Con Edison (Con Ed)

Con Edison is the investor-owned utility serving New York City, which pays the city property tax on its electric facilities and passes the cost to customers.

New York State Public Service Commission

The Public Service Commission is the New York state agency that regulates utilities and agreed with Con Ed on the bill transparency provision.

Manhattan Institute

The Manhattan Institute is a New York-based public policy think tank whose report examined the city's reliance on electricity taxes.

The details

Under the city's policies, Con Ed pays a property tax on its wires and other equipment, and the company passes that cost through to customers. A typical single-family household pays nearly $47 a month, or $561 a year, in New York taxes, and a typical apartment pays more than $22 a month on a $118 monthly bill.

2015: Con Ed's city property tax bill was $1 billion.
2025: Con Ed's city property tax bill reached $2.1 billion.
Last year (2025): The state Public Service Commission and Con Ed agreed to a bill transparency provision.

Market Landscape

New York City's roughly 8 cents per kilowatt-hour collection is several times the rate Chicago and Washington, DC collect through their utilities, marking the city as an outlier among major U.S. cities. The gap positions the city's electricity-based revenue model as a distinct approach within the national utility tax landscape.

A typical New York City household pays nearly $561 a year in taxes embedded in its electricity costs, often without seeing them itemized. The new bill transparency provision would make the municipal property tax amount visible on customer bills.

The takeaway

Electricity bills in New York City carry a substantial hidden tax, and the bill transparency provision could help residents see exactly how much they pay toward municipal revenue. Watching whether the state approves a higher electricity sales-tax rate will show how the city plans to replace lost revenue.