10 Reasons Your Electricity Bills are High and 10 Ways to Lower Them

From simple DIYs to factors outside of your control, here’s what you need to know about fighting your rising electricity bills.

If you think your electricity bills keep getting more expensive, you’re not going crazy.

According to data from the U.S. Energy Information Administration (EIA), the average American household uses 901 kWh a month and pays an average price of 13.12 cents per kWh.

That’s a jump from previous year’s nationwide average price of 12.68 cents per kWh.

It also means the average American faces an electricity bill of at least $118 every month, and over $1,400 every year.

While it’s hard enough dealing with an expensive bill, it’s even more difficult to prepare for these unpredictable spikes in your budget.

Unlike your mortgage or insurance payment, your electricity bills can be higher or lower from one month to the next.

So how can you finally lower your home’s electricity bills for good?

You have to learn what’s to blame for your high energy bills in the first place.

10 Reasons Your Electricity Bill is High and 10 Ways to Lower Them

Even though many of the factors contributing to your electricity bill are within your control, there are others you simply can’t change.

If you’re suffering from high electricity bills, it may be because:

1) Your Appliances and Light Bulbs Aren’t Energy Efficient

Since appliances account for one of the biggest chunks of your electricity bill, it’s crucial that you’re not running ol’ clunkers when you should be upgrading to energy-efficient models instead.

That Energy Star logo is more than a cute design on your washing machine or dishwasher.

They may cost a bit more than traditional machines, but Energy Star appliances use less energy to get the job done just as well (or better) than their other electricity-zapping counterparts.

Appliances with the Energy Star logo let consumers know they’re making a conscious choice to use less electricity and lower their energy bills.

The same goes for all the light bulbs in your house.

If you’re still using traditional incandescent bulbs, you’re way behind the times.

LED lights use 80–90% less energy, provide better bright light, and last pretty much forever.

Image source: Cooler Concord

LEDs used to be out of most homeowner’s budgets, but now they’re more affordable and only cost pennies more than other bulbs. You won’t find better lifetime savings for the small upfront expense.

Lower your electricity bill by: Upgrading all your appliances to Energy Star rated models. Switch out your old bulbs as they burn out for new LEDs, or replace your 5 most-used bulbs today

2) Your Home Needs a Serious Insulation Overhaul

Another majority of your electric bill gets routed to heating and cooling your home.

So if your home’s not properly insulated, all the money you spend on heating and cooling will go right out your vintage windows and drafty attic space.

That means you’re spending more time and money to work your unit harder, just to get to the temperature you want.

Lower your electricity bill by: Replacing all the old windows and doors in your home with well-fitting, multi-pane choices. You can always install weatherstripping around your doors and windows too.

Check out this handy guide from Energy.gov to find out how much insulation your home needs depending on where you live.

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3) Weather has been Extreme in Your Area

Since close to half of your home’s electricity costs stem from your heating and cooling expenses, extreme weather conditions can cause major damage to your wallet.

Since you’re not in control of the weather, it’s best to program your thermostat to safeguard against spikes in your energy consumption like these.

Raise your thermostat just one degree in the summer and you could save 3% on your electricity costs. Lower it one degree in the winter and that savings jumps to an average of 5%.

Lower your electricity bill by: Programming your thermostat to 78°F in the summer and 68°F in the winter. Bundle in layers or hang out in your swimsuit when temperatures become extreme before changing the thermostat.

4) Your Water Heater Needs Some Help

You can run hot water from your tap in under 30 seconds because your water heater is constantly warming the water in the tank.

Even though you may not be using the hot water, your heater will always get close to the temperature you set. But you may not need your water temperature set so high.

Lowering the temperature of your water heater saves money because you don’t need as much electricity to maintain that high heat.

You can also give your water heater an insulation jacket and add insulation to the outside of the pipes to keep the temperature (and your savings) locked in.

Lower your electricity bill by: Lowering the temperature of your water heater to 120°F and adding extra insulation to maintain that temperature efficiently.

Check out this Energy Savings Project video from the US Department of Energy (DOE) to learn how to insulate your water heater tank on your own

5) You’re Keeping Too Many Devices in Standby Mode and Summoning the Phantom Power Vampires

When you turn off your computer, DVR, PlayStation, and other devices, they usually go into standby mode — instead of completely powering off — when they’re plugged in.

But your devices aren’t asleep during standby. They’re regularly performing updates, downloading content, and wasting energy while you’re not using them.

Blame phantom power draws from devices still plugged in for over 10% of your power bill, according to the DOE.

4 Tips to Keep Your Energy Bill from Haunting You (U.S. Department of Energy)

Don’t think those vampire drains are enough to worry about?

The Lawrence Berkeley National Laboratory compiled a list of how much energy devices consume while in standby mode.

The data shows that when plugged in, a:

  • Desktop computer will draw 21.13 watts in sleep mode and 2.84 watts when off.
  • USB hub uses just as much energy on (2.06 watts) as it does when off (1.44 watts).
  • DVR box that’s off uses 1 less watt (36.68 watts) than a DVR that’s on, but not recording (37.64 watts).

Lower your electricity bill by: Plugging your devices into power strips over individual outlets. Instead of having to unplug everything or crawl behind heavy furniture, simply turn off the power strip and unplug that.

As Alina Bradford writes for CNET, you can test your home for vampire or leaking energy.

Bradford says turn off your AC or heating unit and hot water heater. Then turn off everything else in your home, but leave it all plugged in.

Now head to your electric meter box. See the numbers still going up?

You shouldn’t see any energy consumption, in theory, so if you do, that means you have a few vampire devices draining your electricity (and wallet).

There are also plug-in devices available on the market to measure your home’s energy usage if you’re struggling to identify these vampires on your own.

6) You’re Not Running Your Appliances Efficiently

Confused about your high electricity bills even after switching to Energy Star appliances?

You may not be maintaining or running them efficiently enough to notice supreme energy savings.

Image source: EPA

Many people simply forget to clean their appliances. But just like your vacuum works overtime when it’s clogged with dust and grime, your appliances have to work harder when they’re not maintained as well.

When your appliances have to work harder, they’re going to use more energy.

Lower your electricity bill by: Following these best practices for running your appliances without running up your bill:

  • Always change your AC air filters.
  • Clean your fridge’s condenser coils.
  • Line/air dry your laundry once a week (or more).
  • Always wash/dry a full load of clothes.
  • Turn off the heated dry setting on your dishwasher.
  • Install a dimmer switch on your lights.
  • Keep your fridge and freezer full, but not crowded.
  • Always clean the lint trap in your dryer.

7) Your Electricity Rate Fluctuates by the Hour — and You’re Consuming at the Wrong Times

Peak hours of energy consumption happen during the day and into the early evening. This is when the utility companies experience the most demand for power.

Certain utility companies will charge their customers different rates depending on the time of day. So your electricity rate may be higher during peak hours and lower during off-peak hours.

Lower your electricity bill by: Finding out when it’s cheapest to run your appliances. If your utility company charges an average rate for these hour-by-hour fluctuations, it’s still better to run your appliances at night when everyone’s sleeping.

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8) You Have a New Big, Beautiful House

The Residential Energy Consumption Survey shows that homes built during and after the 1990s are 27% larger than homes built in the decades before.

Now, new homes in the US are 1,000 square feet larger than they were back in 1973.

Image source: Property Shark

The average size of a new house built in the US “increased to an all-time high of 2,687 square feet” during 2015. And the median size of a new house currently breaks records at 2,467 square feet.

All this extra room comes with extra heating and cooling expenses.

Lower your electricity bill by: Making your new home the most energy-efficient house in the neighborhood. Though newer houses are bigger, they’re also built for energy savings and outfitted with new windows, insulation, and Energy Star appliances.

If you really want to add next-level technology to your new energy-efficient home, solar panels will cut your electricity bill in half (or more).

9) Where You Live

A factor that may be hard to change, where you live has a lot to do with how much you’re paying for electricity.

Here’s what the average monthly electricity bill may look like where you live, according to data compiled by the EIA:

  • New England (CT, ME, MA, NH, RI, VT): $174
  • Mid-Atlantic (NY, NJ, PA): $148
  • East North Central (IL, IN, MI, OH, WI): $118
  • West North Central (IA, KS, MN, MO, NE, ND, SD): $121
  • South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV): $110
  • East South Central (AL, KY, MS, TN): $102
  • West South Central (AR, LA, OK, TX): $97
  • Mountain (AZ, CO, ID, MT, NV, NM, UT, WY): $111
  • Pacific Contiguous (CA, WA, OR): $148
  • Pacific Noncontiguous (AK, HI): $240

You may be paying more (or less) than these averages due to your local jurisdictions specifically.

For example, the average monthly electric bill for residents in California is much higher ($170) than what residents in Washington pay for their monthly bills ($89) though they’re in the same region.

So what are you supposed to do about saving money if moving isn’t in the cards?

Lower your electricity bill by: Switching to solar energy. Your may be charged a lot for electricity where you live, but your state may also have tons of incentives, tax credits, and rebates to make the cost of going solar more affordable.

Over 48 states offer their residents renewable energy incentives. Check out the Database of State Incentives for Renewable Energy to see which solar incentives you qualify for.

10) You’re Paying for Costs Outside of Your Control

As we mentioned earlier, you can’t totally take control of your electricity bill if you’re still buying energy from the utility or power company.

Unfortunately for consumers, the price of electricity has increased an average of 33% over the last 10 years.

Electricity rates are rising faster than the rate of inflation and what most Americans receive in the way of cost-of-living raises at work.

Want to talk escalating electricity costs in real-time?

Between 2000 and 2014 in Colorado,

  • The average electricity price increased 67%.
  • The rate of inflation increased a paltry 34% in comparison.
  • Household income barely increased at all (24%).
  • Electricity rates went from 7.47 cents/kWh (2001) to 12.18 cents/kWh hour (2014).

What’s the reason electricity is so expensive?

The EIA says there are several factors affecting the price of electricity, such as:

  • The cost of generating fuels like coal, natural gas, etc.
  • Business operating expenses of the utility companies, such as paying their employees, constructing new power plants, advertising expenses, etc.
  • Costs to distribute electricity via power lines and grids, and maintaining them.
  • Extreme weather conditions create an unusually high demand for electricity, which raises the rates for everyone. Natural disasters can also damage infrastructure and the expense of the repairs gets passed on to customers.
  • Complying with government regulations can be costly even though they’re designed to protect our environment.

The biggest expense of the bunch is the cost of acquiring and generating the fuel we use for that electricity:


Lower your electricity bill by: Switching to solar energy. The sun’s energy is totally free, which eliminates the need to generate costly fuels.

Switch to Solar and You’ll Not Only Lower Your Electricity Bills Each Month, You May Completely Eliminate them Forever

Switching to solar energy means you’ll have a trusted solar energy provider install solar panels on your property to capture power from the sun.

Your solar panel installation will start producing electricity the very first day it’s connected. And since it will most likely generate more energy than your home can use, you’ll be generating credits to discount your future electricity bills.

You should be able to offset 70–90% of your home’s energy use with a properly-sized solar array. That means solar owners, on average, save about $100 every month.

Multiply that one month of savings for the entire year and you’ll bank $1,200 in savings in year one alone.

Over time, your savings will help you pay off your solar installation costs so it’s like having free electricity for the rest of your life.

You’ll save the most money the sooner you start, so don’t fall for one of these common excuses people use to delay switching to solar energy.

When you follow all the energy-saving tips today, you’ll reduce the amount of energy your home requires on a daily basis. Then you’ll need fewer solar panels to generate the energy your home needs.

So use these money-saving hacks to lower your electricity bill as your stepping stones to the ultimate goal of $0 electricity bills with solar energy.

Seriously, how does switching to solar energy zero out your electricity bill? Click here to download our free guide and find out now!How Solar Energy Eliminates You Electricity Bill eBook




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