Electricity rates can vary from state to state and even from zip code to zip code. They depend on supply and demand, as well as fuel costs.
But there are ways to keep your electricity costs down, no matter where you live. You can start by making energy-efficient choices and reducing your consumption.
Cost Per Kilowatt-Hour (kWh)
Your electricity rate measures how much energy you use in kilowatt-hours (kWh). You pay for your power by the number of kilowatt-hours that you use each month.
Numerous variables affect the price per kilowatt-hour. These include how much you use, your home’s energy efficiency, and your behavior. It also includes charges for generating and transporting the power to your home or business.
A kilowatt-hour is a unit of energy used to measure how much power you use over time on different devices or appliances. It’s the same way you calculate how much electricity you use to power your TV or car.
To figure out how many kilowatt-hours you’re using on a particular device, multiply the wattage of that device by the number of hours it runs in one day. Then, divide that kilowatt-hour usage by 1000 to get the kWh you used.
Running things like light bulbs and appliances takes a lot of energy. But you can lower your energy costs by replacing old incandescent lights with compact fluorescent (CFL) and light-emitting diode (LED) bulbs.
You can also save money by switching to intelligent appliances. These include smart thermostats, smart air conditioners, and smart refrigerators that can help you conserve electricity. In addition, many new devices are made with energy-efficient technology that can make them more affordable to operate.
Variable-Rate Plans
Selecting your house’s best electricity rate plan can take time and effort. It comes down to how you use energy, your preferred budgeting methods and your local energy prices.
Variable-rate plans allow you to pay an energy rate based on market conditions. This can help you get a lower starting rate or take advantage of lows in the market, but it also increases your risk of paying higher rates when demand and wholesale costs spike.
The recent Texas winter power crisis is an excellent example of how variable-rate plans can cost customers more money than they should. The soaring natural gas prices were awful for customers with these plans, who were suddenly hit with thousands of percent price jumps.
On the other hand, fixed-rate plans keep your energy price stable for the length of your contract. This can be a good option for customers who want to avoid price changes until their contract ends.
Both fixed- and variable-rate plans have pros and cons, and it’s up to you to decide which is best for your energy needs. You can use Power Wizard’s Shopping Tool to find the best rates in under five minutes.
Time-of-Use Rates
Most people get a monthly electric bill with a simple calculation: total usage (kilowatt-hours) multiplied by the rate. The rate may vary across a day, week or month to reflect different periods of energy use and costs.
For example, electricity is often priced higher during “peak” hours. When it’s most in demand, utility companies need more power plants online to meet customer demand for energy. This is why time-of-use rates are designed to encourage customers to spread their energy consumption to other times of the day, which helps take the stress off the grid and promote a more efficient and sustainable power system.
When you switch to a TOU rate plan, you’ll pay lower rates for 21 hours a day when energy demand is most inadequate and renewable resources like solar power are most abundant. This will reduce the power needed to operate your home and help California progress toward its clean energy goals.
To get consumers on board, however, you’ll need to start by making them aware of time-of-use rates and their benefits. The Smart Energy Consumer Collaborative found that only 40% of residential customers knew these rate plans.
The good news is that TOU rates are easy to understand and can be an excellent way to save money on electricity bills. You’ll need to do some homework and choose the right plan for your needs.
Smart Metering
Smart meters provide detailed information about your electricity use, and you can use this information to save energy and reduce your bill. They can also better understand how your electricity usage compares to the average energy consumption across your area. This can help you decide how to adjust your behavior and avoid over-consuming during high-price periods.
As a result, smart metering offers significant advantages to utilities and consumers alike. For example, it allows utility companies to manage electricity usage throughout the day and into the night, which helps them cope with a rise in electric vehicles (EVs) while keeping costs reasonable for customers.
Another benefit of smart metering is that it can help utilities reduce labor costs. The digitized nature of these devices allows them to be remotely read by a computer, eliminating the need for human labor. This reduces costs by reducing the number of employees needed to collect meter readings and ensures that all data is accurately recorded and transmitted.
In addition, smart metering helps improve the grid’s reliability by allowing power companies to react quickly to outages and other issues. It also helps monitor the grid’s status and can be used to predict system failures before they occur.
Smart metering is a relatively new technology that has come a long way in just a few years. While some people are hesitant to embrace it, it can make our lives easier and improve the quality of our energy supply.
