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Calculating Your Electricity Costs

A number of different factors affect the amount of electricity your household uses per year, on average, and in turn your electricity costs. In order to estimate your average usage and costs, a number of things need to be taken into account.

Main Uses For Electricity

The greatest uses of electricity in a household per year include:

  • Water Heating
  • Heating & Cooling

How Much Does My Water Heater Cost Per Year?

There are a few different types of home water heaters: Gas, Oil, & Electric. Gas water heaters use a very small amount of electricity to keep the gas valve open. For Americans with electric water heaters, you can estimate your annual cost associated with water heating with the following equation from (based on the hot water needs of a household of 3):

365 days/year x 12.03 kWh/day ÷ Energy Factor (EF) x Fuel Cost ($/kWh) = annual cost of operation

The Energy Factor (EF) measures a water heater's fuel efficency, which you can normally find in your water heater's product manual (

Water Heater Cost Calculator
Estimate your home's water heating costs at

Estimating Your Heating & Cooling Costs

Heating and Cooling make up the largest energy cost for American households, taking up more than half of their energy expenditures.

Electric Heating Costs

A variety of factors impact the amount you pay for electric heating, including:

  • The size of your home or apartment
  • Your home's construction date
  • Home insulation
  • Your electricity price per kWh

In addition, the type of heating system you have can greatly impact your bill.

  • Heat Pump Systems - generally much cheaper but are not recommended for drier climates
  • Electric Resistance Heat Systems
    • Forced-air electric furnaces
    • Room heaters (Including radiant and space heaters)

Since electric heating can get expensive, be sure to use your thermostat to lower your heat at night or when you are not home. In addition, some utility companies allow "electric thermal storage" which residents can use to load up heat during non-peak times of the day (usually the nighttime) and using it later as needed ( This helps to reduce heating costs in a Time-of-Use electricity plan.

Electric Heating Cost Calculator
You can estimate your home's electric heating costs with Connecticut Light & Power

Estimate Your Electric Cooling Costs

The cost to cool your home in the summer months can get expensive. The cost required to cool your home depends on the following factors:

  • The size of your home or apartment
  • The energy efficiency of your air conditioner(s)
  • Hours of use
  • Price of Electricity per kWh
  • Your insulation

How Much Does it Cost to Run My Appliance?

EnergyGuide Label

Many appliances have an EnergyGuide label, which takes out the guess work in your calculations.

Above: The EnergyGuide label estimates the appliance's average annual:

  • (3) Cost under normal use
  • (5) Number of kilowatt-hours used

The Label also shows how your appliance compares to the cost of running other similar models (4), and the Energy Star logo (6) is shown for appliances which have met the government's standard for higher energy efficiency.

How to Calculate an Appliance's Energy Usage

It is important to note that many devices still use electricity even when they are turned off. Referred to as "phantom" use, appliances like your television often still use energy when not in use. You can avoid this problem by using power strips with an on/off button, since turning them off helps to eliminate phantom costs.

Estimating Costs & Usage

1. Note the amount of time you use an appliance. Either estimate or keep track of the amount of time you use an appliance. For refrigerators, divide the amount of time it is plugged in by three, since they normally cycle on and off during use.

2. Find the wattage used by your appliance. You can either find the wattage stamped on your appliance, or look at a list of common wattages used.

The below chart calculates average annual wattage, average use and kilowatt-hours, and average annual cost for a number of common household appliances.


Power Used (Watts)
[When Active]

Average Active
Use, in Hours/Year

Ann. Consumption

Est. Annual Cost ¤
Appliances: Average Annual Energy Usage
Coffee Maker 1,000 38 58 $5.60
Dishwasher*   365 120 $11.60
Microwave 1,500 70 131 $12.60
Refrigerator-Freezer     660 $63.10
18-W Compact Fluorescent lightbulb 18 1,189 20 $2.10
Torchiere Lamp-Halogen 300 1,460 440 $42.00
Hair Dryer 710 50 40 $3.40
Clothes Dryer   359 1,000 96.0
Clothes Washer*   392 110 10.4
Desktop Computer 75 2,990 237 $22.80
Desktop Computer Monitors 42 1,865 85 $8.20
Analog Television, <40" 86 1,095 184 $17.70
Digital, ED/HD Television, <40" 150 1,095 301 $28.90
Furnace Fan 295 1,350 400 38.2
Water Heater-Family of 4 4,500 64 4,770 458.3
Space Heater 1,320 584 314 $30.10
Vacuum 542 37 55 $5.30
Toaster Oven 1,051 37 54 $5.20
Stereo Systems 33 1,510 119 $11.40
Ceiling Fan (only fan motor) 35 2,310 81 $7.80

* Figures do not include the electricity for heating water and drying.
¤Based on rate of 9.6 cents per kilowatt-hour
See more examples at the US Department of Energy website.

Manual Calculations

To do your own calculations, recommends the following equations:

  1. To find out the number of kilowatt-hours you consume per day for an appliance:
    1. (Wattage × Hours Used Per Day) ÷ 1000 = Daily Kilowatt-hour (kWh) consumption
  2. To calculate the appliance's kWh use per day:
    1. Daily kWh consumption × number of days used per year = annual energy consumption
  3. To estimate an appliance's annual cost:
    1. Annual energy consumption × utility rate per kWh = annual cost to run appliance

Energy Star Appliances

In order to help consumers save money and make more environmentally-friendly choices, the US Environmental Protection Agency (EPA) established the Energy Star program in 1992. Energy Star labeled products meet the EPA's standards for energy efficiency, and homes can even be approved by Energy Star as energy-efficient. Electricity and cost savings with Energy Star appliances can be significant. For example, a new Energy Star clothes washing machine can save the average family $110 a year on electricity bills compared with pre-1994 models. (NRDC)