# How Much Does Electricity Usage Cost?

Winter is approaching which means the refreshing crispness in the air will lead to higher heating costs.   For the most part, modern houses built in Newfoundland use electricity for heat, whereas places like Toronto, use natural gas.  Even if you don’t use electric based heat, you likely use electricity for your washer/dryer, dishwasher, refrigerator, stove and the power hungry hot water heater.  But how much does it really cost you?

The first step is to figure out how much your local electric utility is charging you for electricity.  In NL, the current local rate is around \$0.12/KWh.  You can find the rate in your area by visiting the utility website, or simply looking at your most recent electricity bill.

But what is KWh?  It’s a measure of power consumption and is basically two units of measure; power (kilowatts or 1000 * watts) and hours.  In other words, KiloWatt-hours (KWh) indicates the power you have used for a specified period of time.

In case you wanted to know, Power = voltage * current (measured in Watts or W).

### Typical Household Power Hogs

The Dryer

A typical dryer uses around 5500W of power, or 5.5KW.  If you use the dryer for 1 hour to dry a load of clothes, then you are using 5.5KW * 1hr = 5.5KWh.  Say that your utility charges \$0.12/KWh, then multiply your power consumption by the price the utility charges.  In this case, it would be 5.5KWh * \$0.12/KWh =  \$0.66.  For NLers, every time you dry a load of clothes in an electric dryer, it will cost you around \$0.66.  Say that you do 15 loads in a month, this works out to be around \$10/month added to your electricity bill.  Frugal Tip:  Make sure that lint trap is clean and use a clothes line when weather permits!

Lights

Using CFL bulbs are popular these days due to the decreased energy usage and increased life of the CFL bulb.  We use them where possible at our house which leads to some savings.  Incredibly, a 60W incandescent light bulb (traditional bulb) can be replaced with a 13W CFL bulb and have approximately the same light impact on a room.  A 60W bulb used 5 hrs a day (0.060KW * 5 hrs = 0.30 KWh) would cost around \$0.04/day to use.  Not a big deal, but multiply that by 30 or so bulbs in a house, and it works out to be about \$30/month.  Replacing the incandescent with CFLs would result in paying \$7/month instead.  The higher initial cost of CFLs will quickly pay for themselves over the years.  Frugal Tip:  Use CFLs but wait for them to go on sale!

Hot Water

An electric hot water heater also requires a lot of energy to keep running.  Every time hot water is needed, like for a shower, dishwasher or clothes washer, hot water is pulled from the water tank but gets refilled with cold water.  The drop in tank temperature results in the heating elements turning on until the water temperature reaches the programmed set point.  There are a few variables in determining energy usage of a hot water tank, but lets assume an average 5500W tank and 3 hours of water usage a day.  Using the trusty formula above and assuming \$0.12 KWh, results in a cost of about \$2 per day or \$60 per month.  While this cost can go higher with larger families, the good news is that there are some tricks of the trade to reduce hot water usage.  Frugal Tips: Use low-flow shower heads, try the “quick” setting on your dishwasher rather than the “normal” setting, and wash your clothes in cold water instead of hot.

Electric Baseboard Heaters

While dryers and water heaters are power hogs, the kings of power consumption are electric baseboard heaters, especially in areas with colder climates.  It is estimated that for every foot of baseboard heater equates to 225W of power consumption.  So a 10×10 room with a 4.5ft baseboard heater will use approximately 1KW of power.  In the winter, heating a modest 1000 sq ft living space could cost \$180 (assuming 5 hours per day of heating) or more depending on how warm you like your space and how well insulated your home is.  Frugal Tips:  Use programmable thermostats to automatically turn down the heat when you are at work and when you are sleeping.

TV

A lot of people turn on the TV and leave it on as back ground noise.  With LCD and LED technology, power consumption on even the larger screens aren’t too onerous.  A newer 50″ LCD TV typically uses 150W, which if used 5 hours every day would only run you about \$2.70/month.

Refrigerator

Another appliance that doesn’t use as much energy as you might think is your refrigerator.  According to Fortis, a modern 18 cu ft refrigerator will use about 56 KWh/month or about \$6.72/month (based on \$0.12 KWh), even less if you have one that is Energy Star compliant.

### Final Thoughts

To calculate how much power an appliance is consuming in your house you need to determine the KWh of that device.  To get this:

1. Find out the power rating of your device (Watts or W);
2. Divide by 1000 (to give you KW);
3. Then multiply by the number of hours that you use the device (to give you KWh).
4. Once you determine the KWh, multiply by the rate that your utility charges per KWh.

You will notice that most of your energy is used by a couple of  items namely electric baseboard heat and the hot water boiler.  In colder climates, electric heat can make up 60% of your utility bill.  For us, we have put a lot of effort into reducing our heat bill, here’s more on how we save energy around the house.

If you would like to read more articles like this, you can sign up for my free newsletter service below (we will not spam you).

About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from \$200,000 in 2006 to \$1,000,000 by 2014. You can read more about him here.

• Sebastien Benoit October 27, 2014, 9:21 am

Fyi: kWh is energy, not power. (1kWh=3.6 million Joules). Watts alone is power.

• Big-D October 27, 2014, 10:28 am

Simple thought I use on the hot water heater. Most people are home only part of the day, so like a programmable thermostat, why not do the same for the hot water heater. Mine is set for 2 hours in the AM for showers, Noon for 15 minutes, 5pm, and 8pm for 30 minutes. The tank is insulated and keeps the water warm (enough) for the weekends and I never find I run out of hot water. 15 minutes should be enough to get semi warm water up to temp on a hot water heater. I just know the times in my house where I use the water (lunchtime, mornings, dinner time, and PM for dishes). Laundry is on sunday and we start at 5pm.

• nobleea October 27, 2014, 11:02 am

Bg-D, be careful about Legionnaire’s disease. You want to keep your tank at 50C or higher continuously and then have an antiscald mixing valve afterwards. What you are explaining is very risky.

• Big-D October 27, 2014, 1:24 pm

No more than drinking water directly from the tap (cold water) .. I just read up on it and it is not like the bacteria/amoeba die at 55 degrees (standard cold water temperature). I guess that is why they put chlorine and florine in the city water.

• G October 27, 2014, 3:30 pm

No problems with this article I monitor my monthly smart meter and record the kwh on a calander with winter(heatpump) & summer air conditioning it can be as high as 100 kwh / day for a 1200sq ft house. The daily average without is about 25 kwh and we use oil for hot water. The bill comes in and dividing the total gets me a cost of \$0.20 kwh.

• RICARDO October 27, 2014, 4:27 pm

The hot water tank i sprobably th elargest cunsumer of KWH is your house.
It keeps the water hot all day long whether or not you are using it. If you are going out on vacation you can turn it off. It does not take that much time to heat the hot water up to temperature wen you come back.

WOW! Thirty light bulds? No wonder the astronomers are complaing about light polution. LOL
Rememebr, one mitigating factor for the old incandescent light bulb is that during colder months they are throwing off more heat and therefor their efficiency just might be better than commonly thought off as they both produce light and heat. So, during the heating months they are fairly efficient.

• Bob October 27, 2014, 10:39 pm

Regardless of how much it costs we try to be very conscious of how we use it. There are certain things that you cannot cut back such as the running of the refrigerator or cooking with the stove, but other things like drying clothes outdoors, or even indoors during the winter months, turning off lights and TV when not in use, and using fans during the summer instead of the AC can reduce your usage by a measurable amount on a monthly basis. It’s not just about saving money, it’s also good for the environment.

• Cool Koshur October 29, 2014, 12:46 am

You missed elephant in the room. Electric stoves for cooking and Ovens
They are both electricity guzzlers. Majority of homes have electric stoves as compared to gas stoves.

• Hamilton October 29, 2014, 3:33 pm

Cool Koshur, cooking is actually a very small fraction of most households’ energy consumption: http://www.eia.gov/todayinenergy/detail.cfm?id=10271

Natural gas is cheaper to cook with than electricity (for the moment), but not by that much, and certainly not to quickly cover the cost of a new stove and gas fitting, if necessary. Gas may not be available where the poster is in Newfoundland- even if it were, it comes with fixed costs that would make cooking with gas an uneconomical option.

Anyway, cooking is such a small part of the big picture that most people need not worry about it too much.

• Cool Koshur October 29, 2014, 7:25 pm

@Hamilton
It is for US. Check this link with Appliance Usage Chart from Toronto Hydro

http://www.torontohydro.com/sites/electricsystem/residential/yourbilloverview/Pages/ApplianceChart.aspx

If you scroll through and u will see “Electric Stove” costs ~\$67/ month under Domestic appliances. When you compare it with Electric Dryer which costs around \$13/month. It even scores more than Water heater (\$55/month) for family of 4. IMHO, Electric Stove is No. 1 electricity sucker

• nobleea October 31, 2014, 2:20 pm

Cool Koshur,

That chart states 100hrs of operation on the stove per month. Who has their stove on full blast for 3 hrs and 20 mins every day?? That’s ludicrous. MAYBE an hour a day at best. And it won’t draw full power for the duration its on either.

• Sean Cooper, Financial Journalist November 1, 2014, 12:19 am

When your a landlord, an important decision is whether to make the utilities inclusive. Although it’s less of a hassle when you make them inclusive, there’s no incentive for your tenants to conserve energy. In fact, my tenants left the electric heater on all day and double my energy bill. I learned from this mistake and made sure my tenants pay a percentage of utilities going forward.

• Cool Koshur November 1, 2014, 11:52 pm

@nobleaa
Good catch. I tend to agree that using 6.5 hours per day doesn’t make sense. But this raises a question, how did Toronto Hydro came up with these numbers.

@ Sean Cooper
You raised a important point. I have been bitten by it myself to a point where I ended up disposing off my rental property. Hydro & Water rates have been increasing in GTA at an alarming rate in last 10 years. On average they raise by 10% every year particularly water.

• Sarlock November 6, 2014, 12:16 pm

We have a couple of fold-up laundry stands that we use. We take the wet (damp, after the spin cycle) laundry and hang it up on the racks in front of the washer/dryer. It’s usually dry within 24 hours and saves a ton in electricity.

• nospam November 7, 2014, 8:45 am

Note to electric baseboard heater users on Time of Use power. Use programmable thermostats to turn the heat up at night during off peak, then shut them off during prime on peak hours. Electricity is way cheaper at night for time of use customers. Setting your thermostats the other way is a sure fire way of getting a nasty energy bill at the end of the month.

• Wolfhead November 12, 2014, 11:51 am

I live in rural mid-northern Ontario in a 600 sq ft reasonably insulated and air-tight house. I heat with electricity (gas or oil are not available but I should get a wood stove) and do all the tricks mentioned in the post plus more (there is only 2 adults). My electrical power bill is \$2400 for the year. I will be doing more homework on what is sucking the electrical power but in the meantime, I have invested in the local power generating company and the power distribution company – the both pay over 4% – and the dividends are paying my power bill.

• SST November 12, 2014, 3:04 pm

@Wolfhead: have you looked into any ptions for connecting to the grid via solar and selling your extra power (eg. microFIT)?

• Walter November 12, 2014, 6:31 pm

I have been tracking my energy bills for many years. The past 4yr avg. use is 655Kwh/month with a net avg. electricity cost of \$56.44/month. Now add Administration, Distribution, Transmission, Rider, Pool and GST to this and the actual monthly average bill comes to \$148.83/month or a touch under 23cents/Kwh. That is the actual amount which comes out of my pocket. I am not on a fixed rate contract, therefore my monthly bills have fluctuated from a low of \$95.00/mo to a high of \$225.00/mo depending on the time of year etc.

• Mark Lancester November 13, 2014, 11:31 am

Like others, I think 6.5 hours per day seems not practical. Just wondering where did Toronto Hydro fork out these numbers anyway.