Why is my electric bill so high? And how do I fix it?

If you’re wondering why your electric bill is so high, you’re not alone. In the wake of the pandemic, each of the 13 largest U.S. metropolitan areas has seen higher bills, with the East Coast leading the way. Monthly electric bills have rocketed up by an additional $37 per month in Philadelphia, $34 in New York, and $27 in Boston.[1]

In my seven years of experience working in the residential energy sector, I don’t think I’ve seen such a dramatic spike. Fortunately, there are several solutions that help, especially for homeowners looking to go beyond basic energy saving tips.

In this article, I’ll explore why electric bills are spiking and introduce a major energy-saving tip you probably haven’t heard about.

Why your electric bill is so high: An explanation

There are many reasons why electric bills are higher these days. The obvious reasons include more people staying at home due to the pandemic, as well as the need to crank up the AC during the summer. Both increase energy consumption.

But there’s another, often unexpected reason for higher electric bills: higher rates on that extra consumption. With most household items, the more you buy, the more you save per unit — hence, the logic of bulk purchases. But electricity is different.

The reason why your electricity bills are so high is that the more electricity you use, the more you pay per unit of electricity. So, if your electricity bill is twice as high as usual, it’s not simply because you used twice as much electricity. It’s more likely that your utility is charging you more per kilowatt hour for that extra energy beyond your typical base rate.

If your typical electricity usage is 900 kWh per month, and your average cents per kWh is $0.15, you would pay something around $135 per month.

During the pandemic, let’s say you’ve used 30 percent more energy, or 1,170 kWh. If your utility starts charging you a higher rate of $0.25 cents per kWh anywhere above 1,000 kW, you’ll end up paying $192.50. But $192.50 is far more than 30 percent — the amount of additional energy consumed — it’s 42.5 percent. That extra 12.5 percent is what we experts in the industry call a “double whammy.”

   Before pandemic    After pandemic
   Electricity consumption    900 kWh    1,170 kWh
   Rate: Cents per kWH    $0.15    $0.15 (and $0.25 for 170 kWh)
   Total electric bill    $135    $192.50

   Percentage increase in your electricity  consumption (kWh)    30%
   Percentage increase in your electric bill ($)    42.5%

Ways to save electricity that go beyond the basics

Most of us know about common ways to save energy, so I won’t spend much time telling you to turn off the lights.

However, one question I hear often is, “Do you really save energy by unplugging appliances?” The short answer to that is, “Yes.” According to the Lawrence Berkeley National Lab, standby power accounts for as much as 10 percent of your total home energy use[2] — another reason why your electric bill may be so high.

When it comes to appliances, my advice is to balance effort and reward. Unplugging your cell phone charger may only save a few cents a month, so you could let that go. But there may be an old heater or spare TV in your basement that’s eating up $10 a month.

A man holding a phone with the Wiser Energy app that helps save energy

How to discover hidden electricity waste

But wait, how would you ever notice this basement energy hog? What about other sources of waste? Unless you want to look up the power draw for each one of your electronics, it’s going to be tough to make informed decisions about how to save energy, either through unplugging appliances or other actions.

There’s an easier way to do this. It involves something called a home energy monitor. The Wiser Energy™ home energy monitor is special because it can measure electricity use for each device in your home. Wiser Energy combines an app with an internet-connected smart device that easily clips onto your home’s electrical panel.

The cool thing about Wiser Energy is that it can make even your 25-year-old dishwasher “connected.” The system’s machine learning detects the dishwashers’ unique electrical signature, and then tracks it whenever it turns on and off. It’s like a wearable fitness tracker, but for your home.

Once Wiser Energy learns your home’s devices, it monitors when they turn on/off, how long they run, and how much electricity each one uses. From there, you can set monthly savings targets, spot energy waste, and estimate your next electric bill. It answers the main question of this blog post, “Why is my electric bill so high?” by showing you exactly where you’re using energy, and thereby demystifying your bill.

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