TL;DR: Electricity costs vary widely by state and depend on factors like home size, family size, appliance usage, and energy rates. Learn how utility companies calculate bills, state averages, and tips to lower your monthly electricity expenses.
Key Points:
- Electricity Rate Factors: Rates depend on location, kilowatt hours (kWh) used, and time-of-use pricing.
- State Averages: Hawaii has the highest rates, Utah the lowest; U.S. average is $145/month.
- Influential Factors: Home size, family size, appliance efficiency, and seasonal demand impact bills.
- Deregulated Energy States: Many states offer options to choose lower-cost suppliers.
- Energy-Saving Tips: Opt for fixed rates, energy-efficient appliances, and unplug devices when not in use.
You’ve heard the same advice again and again: make a monthly budget to keep up with your bills.
The problem? That advice only works if you can accurately predict your monthly expenses. One bill that often yields surprises is your monthly electricity bill.
How much is electricity per month, and are you paying too much?
Every state has unique guidelines governing how home and business owners pay for and receive their electricity. This means rates can fluctuate tremendously depending on where in the country you live or work.
Hawaiian residents often pay $230 or more for electricity each month. In contrast, the average Utah resident pays closer to $85 per month. That’s a difference of $1,740 or more per year!
The question is: why?
In this guide, we’ll explain the factors that determine your monthly electricity rates. Keep reading to find out how utility companies calculate your rate. Plus, discover tips for lowering it.
How Do Utility Companies Calculate Electricity Bills?
In the United States, your electricity is based on the number of kilowatt hours (kWh) used in a month. A kWh refers to the amount of electricity used when a 1,000-watt appliance runs for one hour.
In most cases, your electricity usage is tracked by a meter. It records how much electricity flows into your home. Your bill is calculated by multiplying the rate per kWh by the number of kWh used in a month.
In some cases, factors other than your electricity usage may determine how much you pay. For example, some energy companies use a tiered system. Utility companies may also charge higher rates during peak times. This is known as a time-of-use rate.
If possible, consider opting for a fixed electricity rate to better predict your monthly energy costs.
Furthermore, 32 states (plus Washington D.C.) are considered deregulated energy states. That means homeowners and business owners can choose their own electricity supplier. That allows them to compare and shop for lower monthly electricity rates.
How Much Is an Electric Bill Per Month in the United States?
When it comes to electricity rates, Hawaii and Utah are both outliers. Hawaiians pay the most for their electricity (41.27 cents per kWh). Utahans pay the least (11.42 cents per kWh). Rates in most states fall somewhere in between.
According to the U.S. Energy Information Administration (EIA), the average residential electricity rate is 16.94 cents per kWh. This data is accurate as of January 2024 but is likely to change due to market fluctuations.
According to the BLS, the average monthly energy usage in American households is approximately 855 - 900 kWh per month. Based on that data, the average monthly electric bill is approximately $145 per month.
States with the highest average electricity rates include:
- Hawaii
- California
- Connecticut
- Massachusetts
- Rhode Island
- Maine
We already shared that Hawaii is an outlier when it comes to electricity. That’s because the state relies on imported oil to keep it running.
As the second most expensive state, how much is electricity in California per month? The average Californian pays 30.22 cents per kWh. However, California is deregulated, so you may be able to shop for a lower rate.
States with the lowest average electricity rates include:
- Utah
- Louisiana
- Arkansas
- North Dakota
- Idaho
Utah’s rates are low because they have an incredibly diverse mix of energy sources. As a result, they export their surplus energy, keeping rates low for residents.
However, energy rates alone aren’t responsible for determining your monthly electricity bill. Additional factors determine how much you will pay each month.
Factors that Influence Your Monthly Electricity Bill
The answer to “How much is electric per month?” is more complex than knowing your rate. Electricity rates fluctuate based on supply and demand. That means you can anticipate seasonal variations in some markets. Likewise, your energy usage can fluctuate based on your lifestyle.
Let’s explore some of the factors that contribute to your electricity bill.
Home Size
A larger home generally means a higher electricity bill. You have more rooms to light, heat, and cool. You might also have more appliances that require more power to operate. Ensuring your large home is properly insulated and sealed is one way to manage your monthly electricity bill.
Family Size
In a larger household, there are typically more individuals using appliances and electronics. In many cases, these appliances may be drawing power simultaneously. Individual energy consumption habits are also a factor. As a result, the larger the family, the higher the average monthly electricity bill.
Likewise, the smaller the family, the less you can expect to pay per month. How much is electricity per month for one person? Depending on location and usage, one person might pay about $50.
Appliance Usage
Some appliances draw more power than others. Heating and cooling appliances, like air conditioners and space heaters, tend to use a lot of power. That’s why you will likely see the highest electricity bills in summer and winter. Of course, this also depends on your local climate.
Likewise, older appliances tend to draw more power than newer, more efficient appliances. One example is television sets. Old-fashioned cathode ray tube (CRT) televisions draw a lot more power than modern OLED televisions.
Furthermore, opting for Energy Star-certified products is a sustainable way to save money on your monthly bill. All products with an Energy Star label meet strict energy-efficiency specifications set by the government.
Another way to reduce your monthly bill is to ensure you turn off (or even unplug) appliances when not in use. Be aware that appliances draw a small amount of power when plugged in, even if they’re not running. Energy-efficient appliances will draw less power when plugged in and turned off.
How Much Is Your Electric Bill Per Month?
If you live in a deregulated energy state, you have more control over your electricity bill than you think. EnergyPricing.com is an online energy marketplace that makes it easy to compare rates. You can switch to a lower monthly electricity rate in minutes. Our knowledgeable team is here to answer any questions you have before you make the switch.
Lower your monthly bill today. Find lower costs on Energy with just your ZIP Code!
