# Your Electricity Bill Explained

Electricity bills can be daunting. If you aren’t sure how to read your statement, you will have a harder time trying to decide how to lower your bill or prevent high payments. To better understand what you’re paying for, it’s helpful to know exactly how companies calculate your electricity bill. Then, once you know how to determine the amount you owe, you’ll be able to find ways to save money.

### How is my bill calculated?

To estimate your upcoming electricity bill yourself, you’ll need to determine the amount of energy that every device in your home uses. You’ll need to find the wattage of each appliance, how much you use it every day, and how much your electricity provider charges you per kWh (kilowatt-hour).

A kWh is a measurement of the amount of energy you use. It equals the amount of energy used if you keep a 1000 watt appliance on for an hour. For example, a 100-watt item would have to be on for 10 hours before reaching one kWh. You can find your kWh rate on your electricity bill.

Once you have all of the previously listed information, plug the numbers into the following formula:

1. Device wattage x number of hours you use it every day
2. Divide the product by 1000
3. Multiply that number by your kWh rate

Calculating your energy cost per appliance will take a lot of time and thought, so if you want a quicker option, consider investing in technology that does the math for you. Some companies have online tools and products that connect to your electrical panel and directly track your energy usage. Still, they can get expensive, and you usually need to hire someone to install it professionally. For a cheaper alternative, you can get smart plugs equipped with wattage monitoring.

## Reasons for Higher Bills

If you find yourself with a statement that’s higher than usual, consider the potential causes. If there’s been a change in weather, increased energy use caused by your air conditioner or heater can result in a more expensive bill. Other reasons for a higher bill include your electricity provider changing their electric rates, a change in your billing period, or old appliances draining energy.

You may also use more electricity than usual during holiday seasons if you or your family members are home more often. If you find yourself throwing more parties during vacation times, try to find ways to enjoy yourselves without spending an excessive amount of additional energy.

For example, if you tend to throw more hot tub parties during warmer weather, consider researching hot tub party tips that share advice on keeping the energy consumption down while still having fun. You can also look into alternative hot tubs powered by solar energy, which may be the best option if you want to lower your electricity bill while still enjoying your hot tub parties.

You always have the option to shop for electricity providers that serve you better if you feel you could get a more reasonable deal elsewhere. There are tons of electric plans and retail energy providers to choose from, and you can directly compare electricity providers using iSelect to find the best price for you.

## Ways to Lower your Bill

There are steps you can take if you want to lower your energy consumption. One great idea is to try to turn off any unnecessary energy drainers when you leave your home. Remember to turn off your air conditioner, switch off the lights, and unplug any unused appliances when you aren’t using them. You can also try to use less hot water to do laundry, and take shorter showers when possible.

Another way to lower your electricity rates is to invest in energy-efficient appliances. Your old stove or dishwasher can potentially drain a lot of energy simply because they’re outdated. Many eco-friendly appliance brands on the market can help you manage your energy. To go even further, you can install renewable energy sources into your home, like solar panels.