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How to Understand Your Electric and Gas Bills

When you get your electric and gas bills in the mail every month, you probably don't take too much time to read through your consumption rates. Since it's all written in the dense, technical language of energy scientists, it doesn't exactly make for easy reading.

However, what few people realize is that the bill itself offers quite a few avenues for increasing energy efficiency. While gas is typically easy enough to manage, electricity can be somewhat trickier. To reduce your electric bill, you need the advice of an expert in home and commercial electricity.

Nevertheless, there are surprising benefits to be had by paying attention to your consumption as stated on your monthly bills.

Understanding your Electric Bill

One of the most commonly overlooked terms in the average electric billing statement is also the most important: kilowatt-hours.

Kilowatt-hours are the standard measure of energy usage in residential contexts. The average American home consumes around 10,000 kilowatt-hours of electricity per month, according to EIA.gov. Prices vary, but you can expect to pay somewhere around $0.10 per kilowatt-hour.

This information is key to understanding how to cut costs and reduce your electricity bill. The itemized statement included with your bill includes the actual price you pay per kilowatt-hour, which is what you can use to determine how many individual appliances are costing you on a monthly basis.

For instance, a 60 W light bulb running for 5 hours per day at a price of $0.10 per kilowatt-hours will cost $0.06 per day. That might not seem like much, but it adds up—your home probably has at least twenty to thirty light bulbs and many remain on for far longer than five hours per day.

You can make the same calculation for your heavy appliances, which are likely to make up a much larger part of your energy consumption. Consider the refrigerator, for example— 1000 W running 24 hours a day: $2.4 per day, or $70 per month. Use this handy electric bill calculator to find out more.

 Understanding Your Gas Bill

Understanding your gas bill is significantly easier than understanding your electric bill, mostly because fewer appliances in the average home use natural gas. Obviously, your furnace is going to be a heavy draw, especially during the winter months.

The one tricky part of understanding your gas bill is getting used to calculating according to the units your utility provider uses. Use this calculator to convert between Imperial and Metric systems—this is recommended because it converts to kilowatt-hours, which is a unit we are now already familiar with.

You may also calculate the cost of individual appliances using this web application from People's Gas. It measures in BTUs and translates that directly into dollar amounts—just input your cost per BTU as stated on your gas bill and begin. Helpfully, you have a conversion table available so even if your bill is stated in kilowatt-hours, you'll be able to calculate easily.

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