Understanding Your Electric Bill

Most of us don't give too much thought about where our electricity comes from. The majority of people look at their electricity usage in terms of dollars and cents. The bill comes and we pay it. Only when the bill takes a wild swing do we start to investigate. When it comes to solar-electric, you need to look at your electricity bill a little differently.

Each month you are billed on the amount of electricity you use. This amount is measured in kilowatt-hours(kWh).



In order to understand a kilowatt-hour, we must start with a little Electricity 101. We're probably all familiar with the term Watt. A Watt is a term used to express the rate electricity consumption or production. Because a Watt is rate, we must multiply it by time to determine an actual amount of electricity used. For example, if you have a 100 Watt light bulb on for 10 hours:

100 Watts x 10 hours = 1,000 Watt-hours (Wh)

1,000 watts = 1 kilowatt(kW)

1,000 Wh = 1 kWh

Therefore, a 100 Watt light bulb on for 10 hours will use 1 kWh of electricity.

Your utility charges you each month based on the number of kWh's you use. In Arizona, you may be billed at a rate of 10.5-14.5¢ per kWh. This will vary depending on how many kWh's a month you actually use. You may be charged 10.5¢ for the first 400 kWh you use each month and 12.5¢ for next 400 kWh. In addition to the kWh rate, you'll also notice a number of surcharges, connection fees, and taxes. These amounts will vary depending on the amount of electricity you use.

Also, you may also be set up on a time of use rate structure. This means that you may be charged a premium rate during times when electricity demand is high. This typically occurs between noon and 6 pm during the summer months. Check with your utility to determine how you are billed and what other options may be available to you.


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