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Your electric bill: so much Billshit, so little time

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Your utility bill: so much Billshit, so little timeSince October, I’ve spent only about $25 a month on electricity. Impressive, eh?

Well, maybe I shouldn’t toot my own horn quite so loudly. Because last summer, I spent an average of $130 a month on electricity. Since then I’ve made an effort to reduce my energy usage, and it looks like it paid off. As you can see from the screenshot below, my total energy bill for October-December was $49.32. That’s for two months, and that’s the lowest my electric bill has been. Ever.

In this edition of Billshit, I decided to inspect my energy bill to learn more about each charge and see if I could cut it down even more. Let’s check it out.

When it comes to your electric bill, there's so much billshit, so little time

Subtotal Energy Charges: $43.57

In Los Angeles, our energy bill comes every two months. In case you’re not great at math, this averages out to about $22 a month. Granted, in recent months, I haven’t been using the air conditioning and no doubt that makes a huge difference.  But there are two more ways I’ve cut back on energy in recent months:

  • I unplug cellphone and other chargers when not in use.
  • I use smart power strips.

Anyway, at $22/month, I’m content with this charge. But there’s an interesting finding on this bill.

Energy Tiers

When it comes to your electric bill, there's so much billshit, so little time

On this bill, I’ve only fallen under a “Tier 1 Energy” rate, which is 0.13/kWh. Here’s the thing. On my last bill, most of my usage fell under Tier 1, but some fell under Tier 2, which was more expensive. The Tier 2 rate is 0.16/kWh. Once you reach 1,000 kWh of usage, you’re bumped up to a more expensive Tier. I called LADWP to confirm:

“So the more energy I use, the more expensive the rate is?”

“After a certain amount, yes,” the rep told me.

It’s kind of like paying for extra minutes when you go over your cellphone plan. Or being in a higher tax bracket. For a more formal explanation, here’s how the California Public Utilities Commission spits it:

“The rate structure is divided into tiers with a baseline as the basic allocation. Baseline is your energy allowance for basic needs and is billed at the lowest rate.”

Electricity rates are determined by the state, and there’s not much you can do about them. Except–keep yourself at the “baseline,” which means using less energy. Once you pass the baseline, you’re paying even more for your energy usage.

Taxes and surcharges: $4.45

Taxes on your electric bill

This month, my city of Los Angeles utility tax was $4.36. As long as I’m a resident, I don’t have much choice but to pay this:

“All residential and business customers with a billing or service address in the unincorporated areas of the County of Los Angeles are required to pay the UUT. The service supplier (i.e., your gas, telephone, or electric supplier) is responsible for the collection of the UUT and the remittance of the UUT to the Los Angeles County Treasurer and Tax Collector.”

But here’s the thing. This tax is a whopping 10 percent of my bill. That’s even higher than our state sales tax (for now). As is the case with all that Tier business, it pays to have a lower bill. Which sounds kind of obvious, but you know what I mean.

The same goes for the State Energy Surcharge:

“State law directs electric utility companies to gather a state energy surcharge. As of November 8, 2010, this is set at .29 of one mil ($0.00029) per kilowatt/hour (kWh) of electricity consumed by all electrical customers. These funds are segregated in the state treasury as the Energy Resources Program Account.”

Point is, the more energy you use, the higher these taxes and charges are going to be. My previous bill was $276. $26 of that came from taxes and surcharges. This month, my taxes and surcharges totaled less than five bucks.

Solid waste charge: $1.30

In a separate section on my bill is a “Solid Waste Charge” from the LA Bureau of Sanitation. I’ve never noticed this charge on my bill before, but it’s been there. The $1.30 is a “Bulky Item Fee.”

“Is this mandatory?” I asked the rep. “I live in an apartment complex.”

She explained, kindly, that the fee is specifically for apartment buildings that use private trash services. The fee pays for bulky item pick-ups from the City.

“So if you ever need to get rid of something big, like a couch, you can call us and we’ll come pick it up,” she told me.

Good to know.

The lessons here? It’s worth checking your bills and taking the five minutes to research or ask about a charge. You might not be able to do anything about some of them, but you could be paying for a valuable service you’re not using.

Plus, I realized just how much it pays to conserve energy. With the taxes, surcharges and rate difference, you’re basically paying money to pay money. As evidenced by the difference in my latest two bills from LADWP, a few changes can make a big difference.

What do you think? How do you cut down your electric bill?

(Photo: Todd)

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28 Responses to “Your electric bill: so much Billshit, so little time”

  1. Cole Brodine says:

    I actually work for a power company and can give a few tips of my own.

    The two biggest energy users in almost any home is lighting and HVAC (Heat/air), depending on your locale. (Minnesotans are going to pay more to heat/cool their house than people in San Francisco just due to climate, and there isn’t much you can do about it)

    You can really reduce on lighting costs by using compact fluorescents or LED bulbs. A 60 W incandesant bulb gives the same lights as a 13 W Compact Fluorescent Bulb and an LED will be even less. If you have problems with the CFS or LEDs burning out too quickly, try buying a “name brand” bulb versus a cheaper bulb from Wal-Mart or some other place. Check with your utility company. They might even have a rebate or coupons for those types of bulbs. As always, shut off lights when you aren’t using them. If you can install things like motion sensors or timers for certain lighting, it can really make a difference.

    HVAC is the same old tips you always hear. Turn up the temp in the summer so the AC doesn’t run as much and turn down the heat in the winter. Depending on what kind of HVAC system you have, you might be able to replace it with a more efficient system. (Think some type of heat pump versus a forced air furnace). Seal up all the leaks in your house. Put the winterizing plastic on the windows. Get a programmable thermostat like the NEST or even a cheaper Honeywell model. It can make a big difference.

    Another thing to think about is that the rates typically change depending on season. Most areas in the USA will have a cheaper electric rate during the winter than the summer. This means that things like clothes-lines will really help you save a lot of money because you aren’t running your dryer (which also heats the house up and makes the AC run more). Reducing usage in any way during the summer will make a much bigger impact on your bill.

  2. Meagan says:

    Great tips! I also have one if my kids be on “light patrol” and there job is to turn off all the lights before we leave the house

  3. Wilma says:

    I live in the northeast and for years I did the turn the heat down when you’re out and turn it up when you’re home thing. This year with the temps being so low I opted for a straight 67 degrees. No touching the thermostat. Guess what? No difference. I think I even used less oil than usual. The furnace runs less. So I won’t be doing the up and down any more. Will turn it off on warmer days though. Had a few friends end up with frozen pipes doing the up and down temp thing. So is it really worth it?

    As for the electric bill? Mine is usually around $40 to $50. I only turn on lights in the room I’m in. Don’t watch TV. My computer is my entertainment as well as books. I hate the new light bulbs. Not saving money replacing them after 6 months. Just had my carport florescent bulb die after 17 years of extreme cold and warm temps. You can’t convince me the new LED’s or CFL’s are better. They aren’t. I have old flash lights and new LED flash lights. No comparison. The old are better. Much brighter. I have flash lights all over the house for emergencies.

    I use my toaster oven instead of the big one. Only 15 minute showers. Unplug everything or use power strips that can but turned off when things aren’t in use. Vigilance is key to saving a buck. Make a game of it with the kids. If you explain things to them instead of saying “Because I said so” they’re way more cooperative. Now that they’re off on their own I see they’re continuing the conservation effort I started with them.

  4. amy says:

    I do live in the Bay area. our bill (elec/gas) is high even though we don’t use HVAC! (maybe 5 days a yr-the house doesn’t even have central AC cuz it’s quite mild in the summers here)
    I did try to track our bills and called to change our electrical billing to “by time of day” and opted to minimize our electric use from 5pm-8pm (during the peak hours) we can do this mostly because we’re rarely home during those hours. we also try not to charge laptops/cells during that time. and we turn off power strips. one big energy suck is our dehumidifier, but we’re moving to only using that overnight when the power is the cheapest.
    I think we swapped our longest running lights to CFL/LEDs already.

  5. Nick says:

    Great tips and totally support using less electricity to cut costs!
    I have seen two differences sources saying that leaving smart phones plugged in only uses a very minor amount of energy (if you never unplugged it, it would be about the same as leaving a 100 watt light bulb on one time while you were at work).
    As Cole says – you will get a much bigger bang for your buck (and time!) by replacing one high use light-bulb with a LED / CFL.

    http://www.slate.com/articles/health_and_science/the_green_lantern/2009/10/you_charged_me_all_night_long.html

    Also Exxon Mobile says that your smartphone would use the equivalent of one gallon of gasoline to power it for 3000 years. So probably not worth worrying about :)

    http://www.fool.com/investing/general/2013/12/22/exxonmobils-3000-smartphones-per-gallon.aspx

    • Nick says:

      Meant to say that if you never unplugged your smart phone over the course of an entire year, it would be equivalent to leaving a light-bulb on for roughly 8 hours.

      • jo says:

        Ah, but give us the numbers, please. Wattages of light bulb and charger?

      • Anonymous says:

        Yes! I’ve read the same thing–that the ‘vampire’ power thing is a myth. But, I dunno, when I became more conscious of it, my bill seemed to be greatly reduced. Then again, I didn’t just stop draining cellphone energy, but laptop/TV system, too.

      • Kristin Wong says:

        Ah, I was going to ask about this! I’ve read the same thing–that the ‘vampire’ power thing is a myth. But, I dunno, when I became more conscious of it, my bill seemed to be greatly reduced. Then again, I didn’t just stop draining cellphone energy, but laptop and other electronics, too.

  6. Stephen - NYC says:

    Another possibility is to check out your ESCOs. That is, Energy Supply Companies. Here in New York City, Consolidated Edison is the delivery company and since they were forced to divest their generation plants a number of years ago, we now have the joy of shopping for the supply side of the equation.
    Not all states have them. Vermont I know does not (I was visiting a friend in the state and I was trying find out how much he paid and his supply company is his delivery company. So, nothing he can do.

    I have a private house, and I heat with Oil (don’t get me started on their gouging).

    So for the month of Dec 2013, I used 440kWh.
    Here’s how the stuff breaks down:

    Basic service charge $17.34
    Charge for basic system infrastructure and customer-related services,including customer accounting, meter reading and meter
    maintenance.

    Delivery 440 kWh @11.3045¢/kWh $49.74
    Charge for maintaining the system through which Con Edison delivers electricity to you.

    SBC/RPS charges @0.6000¢/kWh $2.64
    The System Benefits Charge/Renewable Portfolio Standard charges fund New York State renewable energy, environmental and other related public policy programs.

    Temporary NY State Surcharge @0.3909¢/kWh $1.72
    Covers new fees imposed by the state.

    GRT & other tax surcharges $3.67
    Taxes on Con Edison gross receipts from sales of utility services and other tax surcharges.

    Sales tax @4.5000% $3.38
    Tax collected on behalf of New York City.

    Total delivery charges $78.49

    Now the supply side:
    33 day billing period from Nov 27, 2013 to Dec 30, 2013
    kWh used 440
    Customer charge $0.00
    Supply cost @10.1500¢ per kWh $44.66
    Sales tax @4.5000% $2.01
    Total electricity supply charges $46.67

    Total for the month: $125.16

    There are 2 people living in the house.

    I do not know if the basic service charge has a min value, but I know it does fluctuate every month and as I think about it, it might just be based on the # of days in the billing period.
    I have a 1-yr contract with an esco, and if their rate jumps too much later on this year, then I will search out another one and sign up with them. That’s what I did when my previous company jacked up their rates way beyond reasonable.

    As you live in an apartment, you probably have less rooms than I do where there are lights. You also probably don’t have an washing machine or dryer, so you don’t have those expenses as I do. But you do have to pay to get your laundry done (either by yourself or you drop it off and pay per pound).

    A nice thing about my ESCO (and probably the others, but I can’t say for sure) is that there is no tier concept. If I was to go hog-wild and run my a/c 24*7 in the dog days of summer, they’d be happy to take my money, but the supply cost is the same. I know that Con Ed has thresholds, but back in the day, I thought it was based on the usage supply. I don’t know if the raise the delivery price based on my usage. I have never seen a tier designation on my bill every since I switched to an ESCO. Not to worry, I have no plans to go wild with the A/C.
    Thanks for listening.

    • Kristin Wong says:

      Thanks for commenting! And for breaking down your own bill. We had the luxury of choosing when I lived in Texas, too. I don’t remember if the company I used had tiers, but I don’t think they did. Thanks for bringing up a great point!

  7. rick says:

    nice article. not sure if they use tiers here in nc. I’ve noticed that since the old dude left this newsletter, that some of the writers use foul language. Can you stop doing this? It’s enough to see and hear this on tv and filthy mouthers at work and in the marketplace. I may have to cancel this if not.

  8. Anthony says:

    I’m extremely impressed. Your daily kWh is 4.8. Mine is 43.9 kWh/day. I’m using 9, almost 10, times the amount of energy that you are!

    I certainly don’t feel like an energy hog, but I’m well over the national average. (I just Google’d it!) So, I will certainly put some of your advice to use.

    Other than that, I wanted to ask: Do you own a refrigerator? I know that there are some insanely efficient fridges these days. A typical EnergyStar fridge from 2010 uses 1.3 kWh/day (again, Google). That’s 28% of your total energy usage!

    Again, just incredible. Makes me rethink things…

    • Kristin Wong says:

      Man, now I’m just going to seem like I’m bragging. Ha! But no, we don’t have an energy efficient fridge. To give some context, there’s two of us, and we live in a townhouse that’s around 800 sq ft. So it’s not terribly big, which saves money on heating and cooling. But the power strip thing really seemed to make a difference. I keep all of my TV electronics on one strip, for example. Then, at the end of the day, I just turn the power strip off, and all of it turns off: TV, Blu-ray, speakers, etc. And, as others have also mentioned, the light bulb switch made a difference, too.
      I hope this helps!

    • Shahid Khan says:

      44 kWh per day is extreme. I use on average about 12 kWH per day and that is because I have a stay at home wife and a toddler who is at home all day.

  9. Wilma says:

    Oh, and I hang my wash up. On days too cold to dry outside I have a wooden folding rack. Puts moisture in the air.

  10. Sandy says:

    Insulate, insulate, and insulate. Go to your local utility company website to see what is recommended amount of insulation. It’s a lot more than even 20 years ago. My husband and son blew in an additional 21 inches of insulation in the attic. My HVAC system runs a lot less. The kWh price has increased, but I’m gaining on how much less power I use for the same amount of HVAC. The ONLY company that makes formaldahyde-free insulation is John’s Manville. Two years ago Lowe’s sold John’s Manville. We bought on sale, and used a 10% discount card, and at the time there was energy tax savings credit available for taxes. Because of the volume we bought, the blower rental was free. I don’t know how much of this applies today, but it’s worth checking.

  11. Mark Ross says:

    We are reducing our time using our appliances, and spending much of the day out of the house, reading books or sleeping. Our country is charging more than yours, that’s why we really need to save up. :(

  12. jonathanira says:

    you can switch to CFL bulbs which use 25% to 35% of what an incandescent uses – and in the summer no heat to drive up a/c costs. can be purchased at many 99¢ stores for 59¢ or 2/$1.00. I’ve also gotten these bulbs for 3/$1.00 and 4/$1.00 at verious times. LED bulbs are also very efficient, but about the same as CFL and cost much more.

  13. Dorothy DeMoss says:

    I am older and retired. Live alone. I am on levelized billing for heating (natural gas) 33.00 month and electric was levelized at around 130.00 a month. I live in the south so electric runs high in summers but with levelized billing I know pretty much what my bill will be each month. being on a fixed income it helps to budget. I just started doing this trick this past year I turn the breaker to my electric hot water heater off. I do not shower everyday maybe every other day I run my dishwasher when it is full.I only flip the breaker on 45 minutes before I shower or want to run the dishwaher.My levelized bill dropped to 79.00 amonth !!!I know with working couples with kids this might not work but it sure does for me.

  14. Marie @ 4HWD says:

    Last month was a bit higher electric bill for us. And now we are trying to save on our electric bill even my six-year old daughter knows how to conserve energy.

  15. Poupar Melhor says:

    I doubt that cellphone and other chargers use the amount of electricity you are implying. I have measured several devices, and they consume very little energy. My cellphone consumes about 1 kWh of energy all year:
    pouparmelhor.com/praticas/quanto-custa-carregar-o-meu-telemovel/

    I have measured several chargers, even some old ones, like,

    pouparmelhor.com/praticas/carregamento-de-um-telemovel-nokia-n97/

    and they all consume very little electricity, and almost none when the phone is disconnected.

    Now, set-top boxes are a completely different story…

  16. Shahid Khan says:

    I just have two simple questions:

    Does everyone here pay a separate supply charge & delivery charge for their electricity?

    The reason I ask this is because in NY (as Stephen stated above) Con Edison charges us both a supply charge and a delivery charge.

    Why does that make a difference? Because I feel like I am paying them twice. If I use 300kW in a month, they bill me for 300kW @ 13 cents per kW which roughly equals $39. But then they also bill you for delivery which equals 300kW at 13 or 14 cents per kW which again equals $39.

    So for using 300kW of power I pay approximately $78 plus sales tax, fees, government fees, etc. Not only do they do this for electricity…..but also for natural gas (a separate supply charge and delivery charge).

    My second question asks what does everyone pay per kW of electricity? Because according to my calculations, I am paying roughly 30 cents for every kW I use (this includes taxes & fees).

  17. Gaile says:

    My P.G,&E BILL USE TO BE 62.00 DOLLARS FIVE MONTHS AGO NO LATLEY ITS A HUNDRED AND FOURTY DOLLARS TWO ONEFIFTY AND MY WATER HAS WENT UP BUT NOT LIKE MY PG&E i dont think its fair. They know i am on a fix income i only get 877.00 a month

  18. Kelsie says:

    I wish I could get my electric bill down that low!
    I’d be happy with a $100 electric bill.

    We average around $250-$350/month where I live. Sometimes it’s even well over $400.

    We always leave our lights off unless we’re in the room… and even then, it has to be at night for us to turn them on.
    We completely switched to CFL’s at one point, and our bill never dropped. AT ALL.
    We even shut our furnace off… in the middle of an Ohio winter.

    Here’s a breakdown of all the taxes/charges/credits on it.
    - Consumer Charge: $13
    - Distribution Charge: 2220kWh – $51.06
    - Generation & Transmission Charge: $170.01
    - Rider A Adjust: $10.29
    - Water Heater Control Credit: -$1.25
    - Current Month Total: $243.11

    It’s just ridiculous.

    Our electric bills used to be roughly $12-$20/month about 10 or so years ago.
    That was before they started adding on all of those taxes/charges.
    Now look what we have to pay.

    And there’s also no way that we’re using 2220kWh.
    We’ve done everything we can to cut back on our power, but somehow it stays the same or goes up. NEVER down.
    Not even after turning our furnace off.

    We’ve been wanting to do an experiment, but we have to wait until spring to do it.
    We’ve been thinking about staying with my mom for a month, and unplugging everything. Turning everything off, and leaving it off for the entire month.
    We want to see if our bill is STILL that high.
    I guarantee it will be.
    On ripoff report, there are reports all over showing our electric company overcharging people in our area. It’s just sad.

  19. Al Pichardo says:

    We live in NYC and after using power supply strips that we turn off at night for TV, modems, cell chargers, etc. and changing all our light bulbs to LED or CFLs we cut our electric bill from $61 to $24 in one month. Talk about crazy charges, NYC electricity costs significantly more than other places in the US because it includes additional charges just for getting the electricity over the wires to you. New Yorkers pay more for a disintegrated system where the companies buy the supply, charge the consumer for that and then charge the consumer for the distribution. Even if the company buys and then distributes over their own power lines and produces electricity from their own power plants (e.g. ConEdison). I cringe every time I think about the guy who cuts the utility check for the billboards and screens in Time Square.


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