A Step-By-Step Guide on Reading Your Electric Bill

Ask yourself the following question. Do you really analyze your utility bill before paying it? For most of us, we look for one thing when we open the statement: the amount due. And even if you did analyze the rest of the bill, it probably wouldn’t make sense to you. At the end of the day all you can do is trust that all the numbers are correct, and you’re not being overcharged.

That being said, there are advantages in learning more about your energy bill. For example, you could look at your bills from month to month to see if you can recognize any patterns. But the biggest advantage of studying and understanding your energy bill is that it will make you more knowledgeable if you are considering switching providers.

So, if you have a recent copy of your utility bill, now is the time to gather it and follow along with the guide below. What you’re about to learn are the most fundamental and important portions of the statement.


  1. Account Number: Besides the total amount due, the account number is the most important part of the statement. It identifies who you are to billing and customer support. And this number is used to aid in the process of switching providers. It is an absolute necessity to enroll for an alternate energy supplier.
  2. Last Payment: This dollar figure refers to your most recent payment and the date it was paid.
  3. Current Charges: This dollar figure refers to the current amount due, the part of the statement that 99.999% of us look for as soon as we open it. It is the total amount due including all taxes and miscellaneous fees.
  4. Applicable Taxes: This portion of the bill gives a breakdown on all taxes that were applied to your bill. If you’re good with math, a simple calculation would provide you with what percentage of your bill is used for state taxes.
  5. Price to Compare: This is a very important portion of your statement. It displays your energy company’s current price per kilowatt hour (kWh). It is this number/rate that you will use to compare with other available energy providers in your area.
  6. Payment Slip: This is the portion of the bill that you will detach and mail to the energy provider along with your payment. It may also display a phone number or website with alternate payment instructions. 
  7. kWh Usage: The total kWh usage for the previous month. In relation to the overall amount due, this figure represents a majority of the total cost.
  8. Bill Breakdown (individual services): This part of the bill may be the most difficult to understand. Basically, it is a breakdown of all the different services used to assist in providing energy to your home or business.
  9. Bill Breakdown (individual prices of services): This portion of the bill displays the prices of the services mentioned in the previous bullet point. If you pay close attention, you will notice that the generation charges represent the largest portion of your statement. The generation service also happens to be the service that you can shop for (and perhaps find cheaper) in today’s deregulated market.
  10. Historical kWh Usage: This helpful chart is a visual representation of energy usage from prior months. For the most part, this chart will be self-explanatory. For example, most of us use our air conditioners 24/7 during hot summer months and our heaters during cold winter months. This chart would show a high spike in summer and winter months while showing smaller usage for those “in-between” months.
  11. Usage Profile: This is an interesting part of the statement that most of us never pay attention to. It displays your overall energy usage from last month and this time last year. And to help you better understand the numbers, it also displays the average daily temperature during these particular months.

Now you have a better understanding of the different portions of your energy bill. So the next time you receive your statement in the mail, don’t just look at the total amount due — look at the rest of the bill to see what went into that total amount.

2017-12-14T10:33:47+00:00 December 15th, 2017|