How to Calculate Your Electric Bill

Inspire Clean Energy

7 min read

category: Clean Energy 101

Calculate Electricity Usage

Budgeting for your monthly bills is just part of being a responsible adult. Even if you have enough money to pay your electricity bill without worrying about it, it’s still a good idea to keep an eye on your energy usage and ensure that your bills are correct.

To calculate your electricity bill, you’ll need to find out the usage of each appliance and device in your home, particularly those used daily. If life were a little easier, we’d all live in smart homes with an app that breaks down the usage for us! Unfortunately, that’s not yet the case. The good news is that it’s not as difficult as it sounds to find out how much electricity each appliance uses and calculate your monthly bill.

How do you calculate electricity usage?

The first thing you need to do to calculate electricity usage is to find out how many watts of electricity each of your appliances and devices are using per day. You can do this simply by multiplying the appliance's wattage by the number of hours it is used per day (see equation below).

  • appliance or device wattage (watts) x hours used (per day) = watt-hours (per day)

Since this gives you watt-hours and you need kilowatt-hours, you need to divide that number by 1,000 (a kilowatt equals 1,000 watts). This will give you the kWh usage per day of the appliance or device.

To estimate usage per month, you then need to multiply that sum by 30 (the average number of days in one month).

  • daily usage (kWh) x 30 = approx. monthly electric usage (kWh/month)

How do you calculate the cost of running an electrical item?

To get the most accurate estimate for the cost of running a particular electrical item, it is a good idea to invest in an electricity usage monitor, which can be bought for around $25 to $50 at the hardware store. These monitors typically measure the usage of devices that run on 120 volts, so you may find that your monitor cannot measure the electricity usage of your larger appliances.

With an electricity usage monitor, you simply plug it into an outlet and then plug the device into it. Once the device is turned on, the monitor will display a reading of how many watts the device is using at that time. You can also read the display after an hour, a day, or longer, to find out how much energy the device has used during that period.

It is a good idea to find a monitor that gives you the ability to enter your utility’s electric rate as it will then give you a fairly accurate estimate of how much the device is costing you each day.

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Calculate electricity cost for appliances

To calculate each appliance's electricity cost, you simply need to multiply the monthly usage, in kWh, by your electric rate as set by your utility company and/or electric plan.

  • monthly usage (kWh) x monthly electric rate ($/kWh) = approx. cost per month

If you are on a variable tariff, you may find that calculating this cost isn’t quite that easy, which is why an electricity usage monitor that gives an estimated cost may be beneficial.

How do you calculate cost per kWh?

To calculate cost per kWh, you need to know how much you pay per kWh, also known as your electric rate as set by your electricity supplier. (You can usually find this on your last bill.) You then need to find the wattage of the device or appliance, which can usually be found somewhere on the product itself (or with a quick Google search!).

Next, use this formula:

  • (device or appliance wattage x hours used per day) ÷ 1,000 x electric rate per kWh

This will give you the cost per kWh for that specific appliance or device.

How much money is a kWh?

This varies a lot depending on where you live and what tariff you’re on. The average in the US is 13.19 cents. The best way to find out is to look at your last bill. We also have a list of electricity rates by state here.

How much is an average electricity bill?

According to the Energy Information Administration (EIA), the average electricity consumption for a resident in a year was 10,649 kWh in 2019. That’s an average of around 877 kWh/month. In terms of cost, that’s around $117.65 per month on average.

Why is my electric bill so high?

If your electric bill is particularly high, that could be for several reasons. Many of us spend more time at home and therefore use more electricity than we would if we were going out to work every day. Electric bills also tend to be higher in the summer when we need to have the AC on all day to keep our homes cool, or conversely in winter when we’re using heat, depending on where you live.

Other reasons for high electric bills include:

  • Appliances and devices left on standby – electronics continue to take in small amounts of electricity even when they are “off,” which wastes electricity and causes bills to be higher.
  • Using large appliances more often than necessary – dishwashers, washers, and dryers need to take in a lot of electricity to run, so using these types of appliances every day can really add up.
  • Outdated appliances – old appliances simply use more energy than newer models, which are specifically built to be energy-efficient. That doesn’t mean you should go and throw out your appliances if they work perfectly well, but if they are on their way out, look into replacing them with more energy-efficient models.

How can I reduce my electric bill?

With these points in mind, you can easily make a number of changes to reduce your electricity usage and in turn your electric bill.

  1. Turn off appliances and devices at the outlet. You could use timer plugs that automatically turn electronics off at certain times, or get smart sockets that can be turned off from your phone.
  2. Use larger appliances only when necessary. Stick to running the dishwasher only when it is completely filled, using the shortest possible cycle and the lowest temperature when you can. Similarly, with washers and dryers, try to reduce usage to a single laundry day per week, filling each appliance to capacity, and using the lowest heat setting.
  3. Make your home draught-proof. Get hold of a draught-proofing kit or draught excluders to keep heat in your home and cold air out. Focus on any exterior doors and windows in particular.
  4. Only heat and cool rooms you’re actually using. Heating and cooling tend to be the biggest electricity expenses, so reducing the space your system needs to heat and cool will naturally reduce costs. Another thing you can do in the realm of heating and cooling is to set your thermostat just a few degrees warmer or cooler than you normally would. Keep your home at a temperature where you’re comfortable in a t-shirt in the summer and a sweater in the winter.
  5. Switch to LED lightbulbs throughout your house. It’s a relatively big expense upfront, but they last for many years and will drastically reduce the costs of lighting your home.
  6. Consider drying clothes outside in the summer. A clothes dryer is a wonderful invention few of us could live without, but running it during the kind of weather where your clothes can dry in 30 minutes is counter-intuitive. Simply hang them out on the line and avoid the cost of running your dryer.

Related: How to Save Energy in 2021

Calculating your electricity bill is a good way to ensure that you stay on budget for the month and are able to determine if you need to cut down a little on your energy usage habits. If you are looking to make a change to more environmentally friendly energy, switch to Inspire Clean Energy.

We provide you with 100% clean energy at a flat monthly price, so there will be no surprises when that monthly bill arrives. With Inspire, not only will you have a consistent monthly electric bill, you will be helping in the fight against climate change, working toward a greener energy market for the future. Find out more and sign up for your clean energy subscription today.

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