Trying to understand the complexities of your electricity bill can be both difficult and time consuming. Which is why we’re here to break it down for you in layman’s terms – that way you can become a bit more informed, while possibly even saving yourself some cash in the long run.
Technology is evolving at a rapid pace. With the new developments in research, and the constant change in our climate, our energy markets have begun to shift towards a more natural gas dominant industry – with renewable energy right behind it.
Now you’re probably asking yourself, “What does this have to do with electricity costs and savings?” Well, it has everything to do with it. The constant flux in the planet’s climate has led to some brutal winters and storms around the U.S. Because of these extraneous times, people are using more energy than ever before.
According to the Energy Information Administration (EIA), residential electricity rates have increased across the nation by about 24 percent within the last 10 years. This percentage may seem small, but when you think of the millions of Americans paying for energy, a 24% increase adds up to be quite large.
A number of factors can impact electric rates, including the resource being used. Natural gas will generate roughly 34 percent of the U.S. electricity in 2019, which will cause prices to continue to rise because of the higher demand that is consistent with natural gas.
On the plus side though, renewable energy continues to expand across the nation. It’s increased availability, plus it’s worldwide impact, has led to major growth within the energy sector. As technological advances in renewable energy continue, costs may begin to decline, because of the efficiency that derives from using some form of renewable energy.
Before we jump into comparing electricity prices and suppliers, we first need to get a solid grasp on what variables affect your energy bill.
What factors impact your energy bill?
An electricity rate is simply the amount you pay per kilowatt-hour (¢/kWh). The average home uses roughly 897 kilowatt-hours (kWh) per month. This leaves the average bill for 2018 at roughly $119 per month.
Even though the estimate above is the average energy bill cost, prices often vary due to various factors. One major factor is your household’s energy use. The amount of appliances you have and how often you use them will have a profound effect on your overall energy bill. Everything from the efficiency of your appliances, to the times you specifically use them play a part in calculating your final electricity bill.
That’s why it’s important to have energy efficient appliances. For example, making an investment into something as small as LED lightbulbs can go a long way into really improving the overall cost of your electricity bill. LED lightbulbs use over five times less energy, while also lasting twenty five times longer than your standard 60 watt incandescent bulb. If you still don’t believe us, check out our blog, “LED vs. regular lightbulbs: Do they really make a difference?”
The climate of where you live will also have a profound effect on your electricity bill. If you happen to live in the north east - where various towns have been struck with deadly winter storms - chances are your energy bill is much higher than those who live in warmer climates. The extensive use of appliances to keep you warm, plus faulty insulation could make your electricity bill much higher than it really should be (which is why we recommend conducting a home energy efficiency audit).
Your biggest energy appliance culprits are typically your central AC unit, water heater, and refrigerator. These three usually consume the most energy. That’s why looking into Energy Star appliances is usually worth it.
How renewable energy is changing the game.
As we mentioned before, the average electricity cost is $119 per month. This is dependent on how efficient you are with your appliances, the climate of where you live, and what type of energy you’re using. As of now, electricity from natural gas accounts for 34 percent, while energy from coal accounts for 30 percent. With these two trending in opposite directions – with the former trending upward – most people will be getting their electricity from natural gas plants.
It’s obvious that the demand for natural gas means prices will continue to rise. But in effect this creates a major opportunity for renewable energy. Wind turbine stations, and solar panel stations continue to pop up across the country. Both wind and solar cost less than half the amount per megawatt hour of what coal costs. The only problem is the current availability of renewable energy. Depending on where you live, this option may not be feasible. Which is why you should already be taking advantage of what Arcadia Power offers.
Through our system, you will be able to access clean energy while also potentially saving on your energy bill. By connecting your local utility account to our clean energy and savings program, you’ll be able to save monthly, while consuming energy from renewable energy projects.
Beginning the investment now into renewable energy will not only reduce your energy costs, but it might also might help lead to lower prices for natural gas and coal in the future. With renewable energy expanding, the demand for natural gas and coal will begin to decline. Once the demand for these commodities begins to drop, prices will follow. Eventually these two pollutant-causing forms of energy will lose control of the energy market to renewable energy.
Once you’ve identified the source of your energy, you can begin to formulate a plan that will reduce your bill. Remember, there’s plenty of DIY tips that you can do that will pay immediate dividends – but none may pay off greater, than switching your energy supplier to some form of renewable energy.