With our homes equipped with many high-tech devices, working out electricity bills could be daunting. It involves thoroughly investigating each appliance's power consumption patterns, understanding your power plans, and different charges on your electricity bills.
While the task is difficult, it can offer valuable insights into your monthly energy needs. Eventually, it will identify lacunas that can lower your power bills and help you with your household budgeting and power management.
This article will be an easy guide to working out your electricity bills. We will discuss how to calculate electricity bills, the role of electricity plans, how to find the energy consumption of different devices, and how to save on your electricity bills.
How Work Out Electricity Bill?
Electricity is billed based on kilowatt-hours (kWh) used. To calculate your monthly electricity bill check the end reading on your previous month's bill and subtract it from your current reading. For example, if your current reading is 1000 kWh and the previous month's reading was 870 kWh, subtract 870 from 1000 to get a total usage of 130 kWh for the month.
Now multiply your total monthly kWh usage by the price per kWh set by your utility provider. The result will be your monthly electricity bill.
Though the process is simple, you may find that the cost given on your bill is more than your calculations. This is due to various other charges that are applied.
What Are The Different Charges On Electricity Bills?
An electricity bill does not only constitute the amount for your power usage. Instead, it comes with many other taxes like delivery rates, capacity charges, TDU, etc. Below are details of these charges for an easy understanding of how your electricity bill actually works.`
Energy use in kWh
kWh usage is the fundamental part of your energy bill that denotes the power you have consumed to run your household appliances. Your monthly bills are most affected by these charges. For example, if you use less power, it will not only reduce your cost per kWh but also lower other related charges.
Energy Rates By Plan
The power market is deregulated in many states of the US. This means, you are charged per kWh depending on your power plan that could be fixed, time of use (TOU) or any other according to your specific electricity provider.
TDU Charges
Another term you will find on your energy bills is TDU charges. These are the tariffs electricity companies charge as per kWh delivery cost, accounting for the management and maintenance of infrastructure and power grid lines.
These charges vary depending on your electricity provider. However, these rates renew every six months and are approved by local government authorities.
Capacity Payments
During peak hours, energy-use boosts require additional infrastructure to fulfill the demand and supply gap. This additional infrastructure is useless during non-peak hours. Thus, electric companies charge capacity payments to maintain a continuous power supply during peak hours. However, capacity payments are charged by only a few power suppliers and are not applicable everywhere.
How To Calculate Electricity Cost Of Specific Appliances?
While you can estimate your total bill by multiplying the total kWh energy consumed with the price per kWh, calculating the electricity cost of each appliance requires a little more effort.
For this, you need to consider two parameters, the wattage requirements of the appliance, usually given on their labels, and their running hours. For example, if an AC uses 2000 watts per hour and you run it for 5 hours daily, its total power consumption will be 10000. You can convert this into kW by dividing with 1000.
Calculating Electricity Bills For Different Power Plans
Your energy plan also affects your monthly bills. Electric companies in the deregulated energy market offer various plans based on individual preferences, which directly influence your power bills.
Suppose you have opted for fixed rates. Your per-kWh rate will not be subject to market energy price hikes and will also be independent of time of use. Conversely, with TOU plans, your per-kWh rate will vary during different times of the day. Some companies also offer other plans, like free nights and free weekends, for customer acquisition.
Below you can find detailed mathematical expressions for working out your electricity bills according to your plan.
Fixed Plan Calculations
You can use the equation below to calculate your monthly bills for a fixed plan.
Monthly electricity bill = Total Energy used in kWh x Price per kWh + Monthly TDU + Capacity Payments (If applicable)
The monthly power consumption of an average US household is 900 kWh, the rate per kWh is $0.23, and the average monthly TDU is $6. Based on these numbers, your monthly electricity bill will be
Monthly electricity bill = 500kWh x $0.23 + $6 = $121
Free Weekend Plan Calculations
As their name indicates, this plan offers free electricity on weekends. Now, let's assume your weekend energy consumption is 20% of your total power used. Here is how to calculate your monthly electricity bills.
Monthly electricity bill = Total Energy used in kWh - 20% x Price per kWh + Monthly TDU
Monthly electricity bill = 500kWh - 100 x $0.23 + $6 = $98
Time Of Use Plan Calculations
In TOU plans, a day is divided into two parts, peak hours and off-peak hours. Energy rates are different for both. For example, the per-kWh price during peak hours is $0.50, and for off-peak hours, it is $0.15. Now, if you consume 200 kWh and 300 kWh of electricity during both periods, here’s how you can work out your electricity bill.
Monthly electricity bill = Total Energy used in peak hours x price per kWh in peak hours + Total Energy used in off-peak hours x price per kWh in off-peak hours + Monthly TDU
Monthly electricity bill = 200 kWh x $0.50 + 300kWh x $0.15 + $6 = $151
Free Nights Plan Calculations
The method for calculating energy bills in the free nights plan will be the same as for free weekends. But because these plans offer more free time, we will increase the free energy from 20% to 40%. Now, the calculations will be like this.
Monthly electricity bill = Total Energy used in kWh - 40% x Price per kWh + Monthly TDU
Monthly electricity bill = 500kWh - 200 x $0.23 + $6 = $75
How Can I Reduce My Monthly Electricity Bill?
With soaring electricity prices, lowering electricity bills has never been more critical. Various practices, like using energy-efficient appliances, opting for a more sustainable lifestyle, ensuring the proper maintenance of appliances, upgrading HVAC, and so on, could achieve the desired outcomes.
Another step that can help you go completely off-grid and ensure your zero carbon footprint is going solar. With innovative advancements in solar panels and the battery industry, solar energy is a viable solution that can fulfill all of a home's power needs. Though its upfront costs are high, these are paid within half the life span of the system, and you ultimately have free electricity.
Below are two solar generator kits from BLUETTI that can help you effectively lower your electricity bills.
BLUETTI AC200MAX + 2*B230 + 3*PV200
- AC200MAX is a pure sine wave inverter with a 2200W output capacity and 4800W surge, enough to run multiple appliances simultaneously.
- Its pre-built battery capacity is 2048Wh, supporting your home power needs for hours. Still, if you find this low, the system is modular, and battery capacity can be extended up to 8192Wh with additional B230 batteries.
- You can recharge your system through seven different streams, including an AC wall outlet, solar, car battery, lead battery, and solar+AC. The last charging method is most effective as it ensures 1400W current flow and requires only two hours to fully charge the batteries.
- Its LiFePO4 battery is the most recommended battery for home power backups with zero environmental impact. This battery also ensures a lifespan of more than 10 years with 3500+ charge cycles.
- Lastly, its price match guarantee ensures you get the best deal in the town. If you get a similar unit that is lower priced than this, you can claim the extra amount within 30 days of your purchase.
BLUETTI EP500 + 3*PV200
- EP500, with its sleek designs and tires, is effective for both indoor and outdoor uses.
- The system’s extensive 5120Wh battery capacity can fulfill the power needs of your off-grid camping for days. Further, this LiFePO4 battery comes with 6000+ charge cycles, extending its lifespan by more than ten years.
- Your safety is of utmost concern from BLUETTI. Thus, the unit integrates a smart Battery Management System that ensures safety and optimum working in all tough weather conditions, ultimately boosting durability.
- The inclusion of a dual-core microcomputer allows for smooth operations through Wifi, Bluetooth, BLUETTI smart app.
- With 10+ output ports, the EP500 is compatible with almost all home appliances and can run them simultaneously.
- Lastly, experience rapid fast charging by adding a 1200W MPPT solar charger, minimizing your dependence on stored power and generating more direct electricity from solar radiations.
The Bottom Line
Calculating electricity costs could seem daunting, given the different charges and plans. However, this little effort can yield exceptional benefits in terms of electricity cost reduction. Calculate your bill by checking your total kWh of electricity consumed and multiplying it by the cost per kWh. Then, thoroughly probe into the electricity different appliances consume to understand your consumption patterns.
One good idea to save on your electricity bills is to go solar, and BLUETTI solar generators are exceptional. Explore a slew of their quality products and opt for what aligns best with your preferences.
