Where your bill goes
You cannot fix what you cannot see. An energy bill is a surprisingly good map of where a home loses money, once you know which lines to read.
The two numbers that matter
Every bill has a usage figure and a rate. Usage is what your home consumed: electricity in kilowatt-hours (kWh), natural gas in therms or CCF, oil and propane in gallons. The rate is what the utility charges per unit. Most of what you can change is usage; the rate is mostly set by your utility and your tariff.
- A kilowatt-hour is 1,000 watts running for one hour. A typical space heater uses about 1.5 kWh for every hour it runs. A phone charger uses about 0.005.
- A therm is a unit of heat, roughly what a gas furnace burns in an hour on a cold day. One therm is about 29 kWh of energy.
Read twelve months, not one
A single bill tells you very little. Twelve bills in a row tell you almost everything. Most utilities show a 12- or 13-month usage chart on the bill or in the online account. Look at its shape:
| Shape of the chart | What it usually means | Read next |
|---|---|---|
| High in winter, low in summer | Heating dominates. Air leaks, insulation and the heating system are the levers. | The winter-ready home |
| High in summer, low in winter | Cooling dominates. Attic heat, duct leaks, shading and the AC's efficiency matter most. | Heat pumps, explained |
| Flat and high all year | A "baseload" problem: water heating, an old fridge or freezer, a pool pump, electronics left on. | The baseload section below |
| Two peaks, winter and summer | Both heating and cooling are expensive. The envelope (walls, attic, windows) is usually the common cause. | The winter-ready home |
Find your baseload
Your baseload is what the home uses in a mild month when neither heating nor cooling runs much, usually April or October. Divide that month's kWh by the number of days. Many homes sit around 10 to 20 kWh per day; a baseload well above that is worth investigating, and the usual suspects are an electric water heater, a second refrigerator or freezer, a well or pool pump, and electric heating left on in a garage or basement.
Where the heat goes
For most homes in a cold or mixed climate, heating is the largest single cost. The heat leaves through roughly these routes, in this order of importance: air leaks (gaps around the attic hatch, plumbing penetrations, recessed lights, rim joists), the attic, walls, windows and doors, and the floor or basement. That order is why energy auditors talk about air sealing and attic insulation before anything else: they are the cheapest fixes for the largest losses.
Hot water, the quiet second place
Water heating is often the second-largest cost and the easiest to ignore because it runs all year. The fixes are usually simple: a lower tank setting, insulated hot-water pipes near the tank, low-flow shower heads, and, when the tank is due for replacement, a heat-pump water heater, which uses a fraction of the electricity of a standard electric tank.
What to do with what you learned
- Decide which season drives your cost. That tells you which guide to read next.
- Note your baseload. If it is high, fix that before touching heating or cooling.
- Consider a home energy assessment. Many utilities and states run assessment programs, some at reduced or no cost. Check current terms with your utility.
- Only then look at equipment, and only then look at which programs may help pay.