Reading your electricity bill doesnโt have to be frustrating or difficult, you just have to know what to look for. Weโre going to outline for you some important definitions, things to look for on your energy bill and most importantly what you need to look at so that you can compare your cost so that you can compare your rates to others so that you can save some money.
Definitions:
๐ก kWh: a measure of electrical energy equivalent to a power consumption of 1,000 watts for 1 hour.
๐ก Energy Rate: How much an energy provider charges a customer per kilowatt for their electricity use ๐ก Base Charge: A set dollar amount that will be charged each month regardless of the amount of kWh used.
๐กDelivery Charges: These are charges by your Transmission and Distribution Utility provider (TDU). TDU delivery charges pay for the maintenance of the poles and wires that deliver electricity to your home and for the meters that measure it. TDU companies are: Oncor, American Electric Power (AEP), Centerpoint, or Texas New Mexico Power (TNMP)
๐กAverage Rate: The combination of the energy rate, base charge and the delivery charges (the price you end up paying per kWh)
๐ก Variable Rate Plan: A variable plan is a plan that the rates will vary month to month as they are dependent on the pricing at the energy market. Generally, these plans are not locked in and you can switch at any time.
๐ก Fixed Rate Plan: Fixed rated plans are generally contracted term plans for a set number of months. Your energy rates are locked in for those set number of months. These plans are typically 6, 12, or 25 months long.
How to read your bill:
Electricity Bill Math:
In order to find the Average Rate, you will need the following formula:
(Energy Charges + TDU Delivery Charges)/Amount of kWh used= Average Rate
From the example above
Energy Charges: 608kWh x 0.087= 53.32
TDU Deliver Charges: 26.79
(53.32 + 26.79)/608 = 13.17kWh Average rate
Weโre all looking for ways to save money on our energy bills. The best way to do that is be educated and find a transparent company that will work with you to ensure you understand what you are signing up for. Please visit us at powernowtx.com, weโd love to serve you.
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