If increasing applying energy to an atom excites electrons, why does electrical conductivity decrease as temperature increases?

As a general rule adding thermal energy doesn't cause electronic transitions. That's because typical electronic transition energies are a few electron volts or around 100kT at room temperature.

In a metal the electrons aren't in discrete energy levels but instead reside in a continuous band of energy levels called the conduction band. While thermal energy can excite electrons within this band it makes little difference to the electron mobility as electrons in the conduction band are already highly mobile.

Electrical resistance arises because electrons scatter off the crystal lattice formed by the atoms making up the metal. The kinetic energy ends up transferred to the lattice where is appears as vibrations of the lattice i.e. heat. If the lattice is already vibrating, i.e. already hot, then it in effect presents a bigger target and the scattering increases and this is why conductivity of metals falls with temperature. If you heat the metal you increase the amplitude of the lattice vibrations and the electrons are scattered more strongly by the vibrating lattice.

However something like the effect you describe is seen in semiconductors. In many semiconductors the energy difference between the energy bands and gap states is comparable with $kT$. If you heat a semiconductor you can excite electrons and that does increase the conductivity. Just as in a metal the electrons are scattered by the lattice, and this scattering increases with temperature, however at moderate temperatures the excitation of the electrons wins and the resistance goes down.

For example look at this graph of the the conductivity-temperature curve for the metal tungsten and the semiconductor silicon:


(diagram from this article)

This shows how the conductivity of the metal falls with temperature while the conductivity of the silicon rises.