How to Calculate Electricity Bill

Electricity ·
How to Calculate Electricity Bill
Table of Contents

If you want to know how to calculate electricity bills or costs, all you need to do is use the following formula:

Electricity Costs = How much you use your appliances × How much electricity your appliances use in kilowatts × Electricity rate at the time you are using the appliance

Or in simple formula, Electricity Bill = Kilowatts × Time of Usage × Electricity Rate Per kWh

Let's take an example to understand better:

Suppose you use an appliance with a power consumption of 2000W (or 2kW) for 2 hours daily. In this case, the monthly kilowatt-hour consumption will be 2kW × 2 hours × 30 days = 120kWh per month. If the electricity rate is 12 cents per kWh, the monthly electricity bill will be $14.4.

Jackery Solar Generators are robust and reliable charging solutions that supply steady power to household appliances, including refrigerators, water heaters, ACs, sump pumps, well pumps, LED lights, and CPAP machines. These battery backups for the home can help you offset high electricity bills by switching to free solar energy.

How to Read Your Electric Bill?

If you want to learn how to calculate electricity bills from meter readings, the first step is understanding the energy costs and several home energy charges in the bill. Let's explain each term briefly:

Electricity Cost

On your home's electricity bill, you'll see the electricity used per month (in kilowatt-hours or kWh). There are two ways to reduce the total electricity cost: reduce the total usage or choose a supplier offering a fixed-rate plan to avoid cost fluctuations.

Capacity Cost

The capacity cost is the fees incurred by commercial customers. It ensures the utility company has enough capacity to meet the total power use demand of all its customers. If you want to reduce these costs, your best bet is to reduce energy consumption during peak electricity hours and switch machinery usage to off-peak times.

Utility Delivery Charge

The utility delivery charge on the electric bill is the expense involved in line maintenance and upkeep to ensure a consistent power supply to homes and small businesses. While you might sometimes see a different term like transmission fee, the impact on the electricity bill remains the same. If you want to understand how to calculate demand charges in electricity bills, multiply the highest 15-minute interval of power consumption by the current per kW rate.

How to Read Your Electric Meter?

Every home gadget or appliance adds to the electrical bill. Understanding how to read your electric or digital meter will help you determine what appliances cost you more than they should. This will help you lower your overall carbon footprint and lower your electricity bill simultaneously. Electric meters read the electricity in kWh (kilowatt-hour). Here are the three different types of electric meters and how to read them:

Digital Meter

Digital meters usually use digital displays instead of dials. You only need to check out the first five numbers shown for digital meters. Remember, you need to ignore the numbers that start with 0.1 after the five numbers on the digital meter. Generally, the amount of energy units used in the billing period equals the difference between one month's reading and the next.

Dial Meter

The dials of the meter represent the total amount of energy you consume. If you are using more energy, the dial will turn more and increase the figure. You will usually see five different dials when dealing with a dial meter. If the dial lies between two numbers, use the number that's been passed. On the other hand, if the dial is directly over the number and has passed zero on the right side, read that number.

Smart Meter

Smart meters use digital technology to capture and store energy. They are equipped with two-way radio communication to record and automatically send the energy usage to SRP.

How to Calculate an Electricity Bill?

There are several terms and concepts you'll need to keep in mind when calculating the electricity bill. Here are a few of them:

Common Term


Kilowatt-hour (kWh)

It's a unit that measures the amount of electricity consumed and represents one kilowatt of power consumed in one hour.

Meter Reading

Electric meters measure electricity usage and consist of two readings: the previous reading and the current reading. You need to subtract these two to determine energy consumption over a specific period.


It is the pricing plan or rate structure set by the utility company that determines the billing of electricity usage. Some tariff structures include tiered rates, flat rates, and time-of-use rates.

Demand Charges

These are the additional fees the utility company imposes based on the peak electricity hours during a specific period. It's worth noting that these charges differ from energy consumption charges.

Energy Charges

The electricity consumption cost is typically calculated based on the kilowatt-hour used. It's one of the essential components of the electricity bill and is charged at a rate per kilowatt-hour.

Taxes and Fees

There are some additional charges, taxes, and fees added to the electricity bills, including regulatory fees, surcharges, taxes, and other government taxes imposed on electricity consumption.

Step-by-Step Process to Manually Calculate the Electricity Bill

Now that you know the different terms associated with the electricity bills, here's how to calculate the electricity bill:

Step 1: Find the Appliance Wattage and Estimate the Monthly Usage

The first step is to create a list of all the appliances you use at your home and write their wattage next to the name. Create a column next to this and write the estimated monthly use of every electrical appliance. The wattage is typically found at the back of the product itself. If there's no label, you can check the appliance wattage chart or use the formula: Watts = Amps × Volts. Once you've found the appliance's wattage, note down how many hours you use each appliance.

Step 2: Calculate the Appliance Monthly Consumption

The next step is to determine each appliance's electricity consumption in kilowatt-hours per month.

Here are the formulas you'll need to use.

1. Watt-hour = Appliance Wattage × Estimated Monthly Usage (In Hours)

2. Kilowatt-hour = Watt-hour / 1000

For example, let's assume you run a dishwasher consuming 1200W for 1 hour per day. The total monthly wattage in watt hours will be 1200W × 1H × 30 = 36000Wh.

how to find watt hours

You can divide the obtained number by 1000 to convert Wh into kWh.

Kilowatt-hour = 36,000Wh ÷ 1000 = 36kWh

how to convert wh to kwh

This means a dishwasher (1200W) running for 1 hour per day will consume around 36kWh per month. Similarly, you can calculate the monthly electricity consumption of other household appliances in kilowatt-hours.

Step 3: Calculate the Total kWh Consumed and the Electric Bill

Now, you'll need to add the kilowatt-hour consumption of all the appliances you measured in the previous step. This will help you get the total kWh usage. You can multiply the total kWh usage by the electricity bill (typically available on your utility bill) to get the amount you pay on the electricity bill.

Use an Online Electricity Bill Estimation Calculator

If you want to use an easy way to calculate estimated electricity bills, you may consider using online electric bill calculators. They can give you a rough estimation based on your household appliances. They use national averages to calculate the costs and are easy to use. However, they come with a downside: they are not so accurate.

Use Household Averages to Calculate Electricity Bill

If you want a general idea of how much electricity each household appliance consumes, you can check out the household averages. Here's an image that reflects which appliances consume more electricity at home.

what appliances use the most energy at home

Why Is My Electricity Bill So High?

There are numerous times when the monthly electricity bills exceed expectations, and you're left wondering, "Why is my electricity bill so high." Here, we will explore the different potential reasons behind high electricity bills:

You Have Older Appliances

Older appliances were not manufactured with efficiency standards in mind, and hence, they consume more electricity to generate the same amount of power as newer Energy Star appliances. Using older appliances at home can contribute to high monthly electricity bills. Even if you are using new appliances, they can degrade and lose efficiency after some time. It's better to upgrade to more energy-efficient appliances for significant annual savings.

Inefficient Use of Appliances

Many modern electronics continue to draw a small amount of electricity from the outlet even when they are fully powered. This is because these appliances have entered the "standby mode" until they are turned on. Such appliances are called "vampire appliances" and may include garage door openers, DVR systems, phone chargers, microwaves, etc.

Electricity Rates Are Increasing

The average electricity bill varies by state and has typically increased over time. Rising energy costs, including natural gas and oil, contribute to high electricity rates and bills.

Less Efficient Heating & Cooling Systems

Heating and cooling your residential space can be expensive, especially if you are dealing with winter storms, rising temperatures, and other natural calamities. If you're using an older HVAC system, it might not be running quite efficiently.

Changes in Seasons and Weather

The space heater works harder on cold days, and your air conditioner needs to run for long hours in the summer. This means you'll be using more electricity than in previous months, and hence, the electricity bill is higher.

Inadequate Home Insulation

In extremely hot or cold months, inadequate insulation can make the HVAC system work harder to heat or cool your home. As a result, you may experience high electric bills.

Using Energy During Peak Times

Demand for electricity changes throughout the day. For example, the electricity rate decreases when only a few people are using the electricity. If you are using electricity during the peak hours when the demand and rate of electricity are higher, you may experience high electricity bills.

How to Reduce My Electricity Bill?

When the temperature increases in summer, the demand for electricity increases. This increase in electricity demand is passed on to customers as a result of higher energy bills. If you want to reduce the energy costs, here are some of the tips to follow:

Choose Energy Efficient Appliances

If the home appliances or HVAC systems are not as efficient as they should be, consider investing in household appliances with Energy Star ratings. They are known to consume less power and reduce the high electricity bills.

Adjust the Thermostat

A straightforward way to reduce electricity bills is to adjust the thermostat. If you change the thermostat by 7 to 10 degrees up to 8 hours a day, you can probably save up to 10% on your heating and cooling costs. You can adjust the thermostat when you're asleep or away from home. If you don't want the manual hassle, you can invest in a smart thermostat that can automatically adjust during such hours.

Use Solar Energy

Sometimes, it's not possible to offset a significant portion of your electricity bills. If that's the case, consider investing in eco-friendly solutions like solar generators. Jackery Solar Generators are designed to charge most household appliances using the free solar energy generated by the Jackery SolarSaga Solar Panels. This will help you reduce the reliance on the electricity grid and lower monthly electricity bills. Additionally, they act as emergency battery backup power sources that can keep appliances running during unexpected power outages or blackouts.

Turn Down Your Water Heater

Most manufacturers set thermostats at 140°F or 60°C, but you only need to set them at a maximum of 120°F. Lowering the water heater's temperature can help you save thousands of dollars per year. Before proceeding, make sure you check the user manual for instructions on how to turn down the water heater.

Turn Off & Unplug When Not Using the Appliance

If you often leave home appliances plugged in or turned on when not in use, you're unnecessarily driving up your electricity bills. In order to reduce the bills, start by turning off lights or other appliances when not required. Additionally, unplug chargers or other appliances that might be drawing power on standby mode.

Jackery Solar Generators for Lowering Electricity Bill

Jackery is a global brand that manufactures high-quality and efficient portable power stations, solar panels, and solar generators. The Jackery Solar Generators consist of Jackery Portable Power Stations and Jackery SolarSaga Solar Panels, which charge essential household appliances for long hours.

The direct sun's rays are absorbed and converted to DC electricity by the Jackery SolarSaga Solar Panels, which is then converted to AC electricity by the pure sine wave inverter of the Jackery Portable Power Stations. The powerful solar generators have wheels and sturdy rods for easy and quick movements. With solar generators, you can reduce the monthly electricity bills and save more money.

Jackery Solar Generator 3000 Pro

If you want to charge most household appliances for long hours and offset a significant portion of your electricity bills, then the Jackery Solar Generator 3000 Pro might make more sense. It's an ideal charging solution capable of supplying steady power to heavy-duty appliances, such as refrigerators, air conditioners, heaters, etc., to reduce monthly power consumption. It has pull rods and double wheels to move the solar generator wherever needed.

Appliances running time:

  • TV (100W) = 25.7H
  • Coffee Maker (800W) = 3.2H
  • Microwave (1100W) = 2.3H
  • AC (1000W) = 2.5H
  • Refrigerator (400W) = 6.4H

jackery solar generator 3000 pro to lower electricity bills

Customer Review

"Living in a condo leaves very few options for a generator during power outages. I cannot have any fuel-type generators on the balcony. I have tested its mettle by running a few power-hungry small appliances simultaneously and keeping the refrigerator going. It held up very nicely." — Wendy Horn.

Jackery Solar Generator 2000 Plus

The Jackery Solar Generator 2000 Plus is an expandable and versatile charging solution that can power 99% of household appliances. You can expand the battery capacity all the way to 24kWh, making the solar generator ideal for off-grid living, long-term power outages, and extended blackouts. Its LiFePO4 battery can supply safe and stable electricity to refrigerators, space heaters, tankless water heaters, and ACs. With the expandable battery backup, you can reduce the high electricity bills and save money.

Appliances running time:

  • TV (100W) = 17.3H
  • Coffee Maker (800W) = 2.1H
  • Microwave (1100W) = 1.5H
  • AC (1000W) = 1.7H
  • Refrigerator (400W) = 4.3H

jackery solar generator 2000 plus to lower electricity bills

Customer Review

"Very good quality, the battery lasts a very long time. Very easy to move around with the built-in tires. Love the upgradeability. The best solar generator I have ever had." — Marc.

Jackery Solar Generator 2000 Plus Kit (4kWh)

If you are looking to practice off-grid living and lower your reliance on the electricity grid, consider investing in a Jackery Solar Generator 2000 Plus Kit (4kWh). It can help you charge most household appliances and safeguard yourself from unexpected power outages. It's compatible with Jackery SolarSaga 200W Solar Panels, so you can recharge the battery using free solar energy.

Appliances running time:

  • TV (100W) = 34.7H
  • Coffee Maker (800W) = 4.3H
  • Microwave (1100W) = 3.1H
  • AC (1000W) = 3.4H
  • Refrigerator (400W) = 8.6H

jackery solar generator 2000 plus kit 4kwh to lower electricity bills

Customer Review

"The Jackery Explorer 2000 Plus and Battery Pack with the 400W solar panels package is a great combination for home backup and RV usage. The 120VAC and RV receptacles and the others are great to have on the unit. I like the idea of purchasing another battery pack if I need more power in the future." — Larry Gee.

How to Calculate Electricity Bill FAQs

What size of solar generator do I need for my house?

The size of a solar generator for a house depends on the appliances you've at home, the wattage consumption of each appliance, and the number of hours you would like to charge.

Let's assume you are charging a refrigerator (400W), portable water heater (400W), and AC (1000W) at the same time with the help of the Jackery Solar Generator 3000 Pro. The working hours of solar generators can be quickly calculated as follows:

Working Hours = Battery Capacity in Wh × 0.85 / Operating Wattage of Appliances = 3024Wh × 0.85 / 1800W = 1.4H.

Note: The battery capacity is multiplied by 0.85 because there will be some power loss when charging the appliances.

How do you calculate the cost per kWh? 

The cost per kilowatt-hour is the rate at which power is supplied by the electricity provider. If you want to calculate the price per kWh, divide the total power bill minus taxes by the total power consumption.

Cost Per kWh = (Total Power Bill — Taxes) ÷ Total Power Consumption

For example, if the total power bill is $300 and taxes are $50, the cost per kWh for 2500kWh consumption will be ($300 – $50) ÷ 2500kWh = $0.10 per kWh.

How to calculate monthly electricity consumption?

To calculate monthly electricity consumption, you must multiply the daily power consumption by the number of days a month. If you use a TV (100W) for 2 hours daily, the total monthly electricity consumption will be 100W × 2H × 30 days = 6000Wh or 6kWh.

Is 40kWh per day a lot?

A home with over 3000 square feet typically uses an average of 42kWh per day, which is twice the average usage of a house with less than 1000 square feet. If the US home is around 2000 square feet, the average usage will be around 30 - 33kWh daily.

What uses the most electricity in a home?

Some household appliances that cost the most electricity include cooling and heating, water heaters, washers and dryers, lighting, refrigerators, electric ovens, TVs, DVDs, cable boxes, dishwashers, and computers.

Lower Your Electricity Bills With Solar Generators

Understanding how to calculate electricity bills will help you offset the high electricity costs and save money. Once you know your monthly electricity bills and the reasons behind high bills, you may consider investing in energy-efficient appliances and solar generators. Jackery Solar Generators are reliable and robust charging solutions that supply power to 99% of household appliances. With these solar generators, you can offset the high electricity bills.

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