How Can I Make My Electricity Bill More Affordable & Predictable Each Month?

By John Rose, August 30, 2016, Energy Efficiency, Save Money

Speaking from personal experience, living on a limited income can be quite difficult – and that’s putting it mildly. The necessities of daily life leave little wiggle room for any enjoyable extras, and even the necessities may have to be prioritized based on your budget.

How Can I Make My Electricity Bill More Affordable & Predictable Each Month? | Bounce Energy Blog

Yup. There are a lot of bills that must be paid each month – and your electricity bill probably sits atop that list.

And near the top of that list of life’s essentials is electricity. Keeping the power on means heat in the winter, air conditioning in the summer, refrigeration, cooking, hot water, lighting, communications, and so much more. It all depends upon electricity, which means you occasionally have to find ways to stretch your dollars to pay your utility bills. Fortunately, there are ways to get your electricity bill under control and to make it a predictable part of your monthly household budget.

1) It All Starts with Understanding Your Electricity Bill

How Can I Make My Electricity Bill More Affordable & Predictable Each Month? | Bounce Energy Blog

If you’ve never looked at your electricity bill before, you might be shocked at what you see. But try not to be this guy.

It really all starts with learning how to read that bill you receive once a month from your Texas electricity company.

Few people walk into a grocery store and fill their cart with a bunch of impractical produce and supplies, paying no attention to what they actually need or how much it will cost them. Yet, many of us do exactly that with our electricity habits. We don’t know how much electricity we use during the month, how much we really need, or how to budget our energy usage.

A home energy budget focuses on a targeted maximum monthly kilowatt-hour (kWh) usage, and it’s a fantastic way to reduce the likelihood of monthly bill surprises. The amount of energy we use each month depends on a lot of factors, but since a limited income doesn’t provide a lot of flexibility, reducing the volatility of your monthly electricity expenditure is an important tool for controlling your expenses and keeping the lights on.

Note: in order to reduce the likelihood of budget overruns, this approach is based on using a fixed-rate electricity plan where the cost per kWh does not vary month to month during your contract term. This is opposed to using a variable-rate plan where the cost per kWh changes each month.

2) Determine Your Actual Electricity Usage

How Can I Make My Electricity Bill More Affordable & Predictable Each Month? | Bounce Energy Blog

Just start the month by checking the number displayed on your electricity meter. Add 750 mentally, and take measures not to exceed that number.

Specifically, learn how much you use during peak usage months by reviewing old bills in order to establish some upper bounds for budgeting. For instance, if you historically use more electricity in January than in June, if you budget for January, you won’t likely go over in June.

There are a few things to consider when examining old electricity bills:

  • Unseasonable conditions can alter typical monthly usage patterns.
  • Pay attention to any lifestyle changes, such as children moving out or a change in sleeping patterns.
  • Keep an eye on how your energy provider bills you, as sometimes they use estimated bills (based on what you used at some time in the past). If you find you’re being billed based on estimated usage, request a bill adjustment that reflects your actual use.

Once you’ve narrowed down your peak usage month(s), make note of the kWh’s used – this figure will be your new electricity usage threshold.  Now that you know how much your maximum usage was in the past, you can now calculate a new target that better fits your budget. Here is an example of how to calculate a new usage target:

  • If your maximum usage was 1000 kW/h at $0.10 per kWh, you paid $100 that month for energy.
  • If you want to reduce your bill to a maximum of $75 per month (which helps if your rate stays the same, set your maximum monthly usage at 750 kWh’s.

3) Put Your Knowledge into Action

How Can I Make My Electricity Bill More Affordable & Predictable Each Month? | Bounce Energy Blog

An easy way to reduce your electricity usage? Set your air conditioner at 78 F during the day in summer and your heater at 66 F during the day in winter.

With your new usage target in mind, it’s time to make some changes. For example, if, like me, you prefer a lot of lighting, scale back on the number of lights you use and consider putting up some inexpensive mirrors that can help amplify the effect of the available light.

As you make these changes, monitor your usage on your electricity meter, which is simple if you have an AMS Smart Meter with a digital readout. Check daily at first in order to see how much energy is being used as you tweak your electricity usage. Continue to adjust until you find the amount of usage that fits your budget .

Once you’ve settled into a pattern that meets your needs, write down the kWh listed on your smart meter at the beginning of each month and add 750 to that number – this will be your maximum usage threshold you shouldn’t cross. As the month progresses, periodically check what you are using against your target. If you find yourself going over at any point, dial back your electricity usage a bit in order to get back on track.

With a plan in place, electricity bills can transform from a source of anxiety to a predictable part of your budget.  Getting into any new rhythm may take a little time, but before you know it, it’ll become second nature and you can look forward to one less unknown when it comes time to pay the bills.

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