Trystan Casey
The cost of electricity is a significant concern for many, with monthly electric bills fluctuating based on seasonal changes, usage habits, and global issues. The average electric bill was $136.84 in 2023, with rates varying from 11.59¢ to 43.01¢ per kWh. These rates differ across states and regions, influenced by energy markets, utility fees, and local taxes. For instance, North Dakota has the lowest residential electricity rates at 11.69 cents per kWh, while Hawaii's rates are the highest at 42.44 cents per kWh. Energy-saving practices and switching energy suppliers are some ways consumers can manage their electricity costs.
| Characteristics | Values |
|---|---|
| Average monthly electricity bill for residential customers in the US in 2023 | $138 |
| Average monthly electricity bill for residential customers in the US in 2022 | $135 |
| Average monthly electricity bill in Utah in 2023 | $87 |
| Average monthly electricity bill in Louisiana in 2023 | $142 |
| Average monthly electricity bill in Hawaii in 2023 | $213 |
| Average monthly electricity bill for businesses in 2023 | $762.51 |
| Average monthly electricity usage in the US | 855 kWh |
| Average monthly electricity usage in California | 491 kWh |
| Average monthly electricity usage in Hawaii | Lowest in the US |
| Average monthly electricity rate in California | 31.77 cents per kWh |
| Average monthly electricity rate in North Dakota | 11.69 cents per kWh |
| Average monthly electricity rate in Hawaii | 42.44 cents per kWh |
| Average monthly electricity rate in Texas | 9 cents per kWh |
| Average monthly electricity rate in the US | 17.45 cents per kWh |
| Average monthly electricity rate in the UK | £2,500 for typical annual consumption levels up to June 2023 |
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What You'll Learn
How to calculate your monthly electricity bill
The cost of electricity varies depending on a range of factors, including location, the season, and usage habits. For example, the average monthly cost of electricity in Hawaii is $42.44 per kWh, whereas in North Dakota, it is $11.69 per kWh.
To calculate your monthly electricity bill, you can use the following formula:
Average monthly electricity cost = Average monthly electricity usage (in kWh) x Electricity rate (in $ per kWh)
For example, let's say you live in California, where the average electricity rate is 31.77 cents per kWh, and your monthly usage is 491 kWh. Your monthly electricity cost would be:
491 kWh x $0.3177 = $155.99
You can find the average electricity rate in your state or region by checking the latest data from the U.S. Energy Information Administration (EIA) or other energy comparison websites.
It's important to note that your monthly electricity bill may fluctuate due to seasonal changes and your usage habits. For example, during the summer months, increased use of air conditioning can lead to higher electricity bills. Similarly, if you have many appliances plugged in, even when they are turned off, they can still consume energy and impact your bill.
To optimize your electricity usage and manage your costs, you can consider the following:
- Using power strips and dimmer switches to cut off the electricity supply to modern appliances that consume energy even when idle.
- Switching to energy-efficient light bulbs to reduce electricity consumption.
- Adjusting the temperature settings on heating and cooling appliances, such as refrigerators, to eliminate extra energy consumption.
- Opting for renewable energy sources, such as solar energy, to generate your electricity onsite.
- Comparing rates and contract terms from different energy suppliers to find the most competitive rates and plans that match your usage habits.
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Reducing your monthly electricity costs
The average monthly cost of electricity varies depending on a range of factors, including location, the season, and usage habits. In 2023, the average monthly electric bill was about $137, but this can be much higher or lower depending on your circumstances.
Understand your energy usage
To reduce your energy bills, it's important to first understand your energy usage. You can use an online energy usage calculator to estimate your home's energy consumption and identify areas where you can cut back. For example, you might discover that certain appliances are using more energy than you realized, or that your energy usage is higher during certain seasons.
Reduce your energy consumption
The most straightforward way to lower your energy bills is to reduce your energy consumption. This can include simple steps such as switching to energy-efficient light bulbs, using power strips to cut off the electricity supply to devices that are not in use, and adjusting the temperature of your refrigerator. You can also look into larger changes, such as installing solar panels to generate your own electricity.
Choose a cheaper energy plan
If you live in a deregulated area, you may be able to choose your energy supplier and plan. Compare rates and contract terms to find a plan with a cheaper rate. However, keep in mind that lower rates do not always equate to lower bills, as your usage and the terms of the plan also factor in.
Seek expert advice
Consider seeking expert advice on reducing your energy bills. Energy experts can help you understand your energy consumption and provide advice on how to reduce your monthly bill. They can also provide insights into average electricity bills and how to consume energy wisely.
Consider renewable energy options
If sustainability is a priority for you, look for energy providers that offer renewable energy or green energy plans. Not only will this help reduce your carbon footprint, but it may also result in cost savings. Community Solar, for example, can help you save money on electricity while supporting clean, renewable energy generation.
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Factors that influence electricity costs
The monthly cost of electricity is influenced by a multitude of factors, which can be broadly categorised into supply-side determinants and demand-side considerations.
Supply-side factors
The cost of electricity is influenced by the cost of fuel, which is subject to fluctuations based on global events and supply chain issues. For instance, the Russia-Ukraine conflict has impacted fuel prices. Certain states, like Hawaii, have higher electricity costs due to their reliance on expensive imported fuel. Conversely, states with an abundance of natural resources for electricity generation, like Washington's hydroelectric infrastructure, can offer cost-effective electricity.
The age and efficiency of the grid infrastructure also play a role. Older, inefficient infrastructure can lead to higher costs for consumers. The deregulation of the energy market in certain states also impacts costs. In deregulated areas, consumers can benefit from price competition between providers, but this also exposes them to price volatility.
Demand-side factors
The size of a residence and the number of occupants influence electricity costs. Larger spaces, such as single-family homes, generally require more energy for lighting, heating, and cooling. Additionally, the use of energy-inefficient appliances can significantly increase electricity bills. Modern appliances, even when turned off, can still consume energy if they remain plugged in, acting as "energy vampires".
The season also impacts electricity usage, with higher electricity consumption during the summer due to air conditioning and high-voltage generation sources.
Location
Electricity rates vary significantly between states. As of July 2025, North Dakota had the cheapest residential electricity rates at 11.69 cents per kWh, while Hawaii had the highest at 42.44 cents per kWh.
Behavioural factors
Consumer behaviour also influences costs. Tracking energy usage and understanding which appliances consume the most energy can help reduce costs. Switching to energy-efficient light bulbs, utilising solar energy, and adjusting temperatures on appliances like refrigerators can all contribute to lower electricity bills.
In summary, the monthly cost of electricity is influenced by a complex interplay of supply-side factors, demand dynamics, consumer behaviour, location, and the efficiency of the grid infrastructure.
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Differences in electricity costs across states
The cost of electricity varies significantly across different states in the US, with several factors influencing these variations. As of July 2025, North Dakota boasts the lowest electricity rates in the country, with an average of 11.69 cents per kilowatt-hour (kWh) for residential customers and 7.18 cents/kWh for businesses. In contrast, Hawaii has the highest electricity rates, with an average of 42.44 cents per kWh.
Economic factors play a pivotal role in determining electricity costs. States with higher living costs or limited natural resources tend to have higher electricity rates. For instance, Hawaii, with its isolated location and limited resources, falls into this category. Conversely, states like North Dakota, with abundant natural resources, benefit from lower electricity rates.
Market dynamics, resource pricing, and structural elements also come into play. Fuel costs, including natural gas, coal, and oil prices, directly impact the cost of electricity generation. The cost of infrastructure, such as transmission lines and power plant upgrades, is another factor that contributes to the overall electricity rates.
Deregulation of the energy market in certain states, such as Texas, allows customers to choose their electricity provider. This competition among providers can lead to varying rates and plans, offering customers more choices to suit their needs. However, deregulation can also result in price volatility during peak demand.
The Northeast region of the US, including states like Massachusetts, Rhode Island, California, Connecticut, and New York, tends to have higher electricity rates. This is partly due to the high population density, increased demand, and higher cost of living in these states. In contrast, central states often experience lower electricity rates, along with lower demand and a lower cost of living.
Additionally, factors like weather, seasonal demand, and the availability of renewable energy sources can influence electricity prices across different states. Understanding these factors can help consumers make informed choices and potentially lower their electricity bills.
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Choosing an electricity supplier
The monthly cost of electricity depends on a variety of factors, including location, property size, energy usage, and the efficiency of appliances. The average monthly electric bill was approximately $137 in 2023, but this can vary significantly from state to state. For example, Hawaii, Massachusetts, California, and Alaska tend to have some of the most expensive electricity in the United States.
When it comes to choosing an electricity supplier, there are several factors to consider. Here are some guidelines to help you make an informed decision:
- Location and Licensing: Ensure that the supplier serves your state and has the necessary licenses to operate in your region. You can usually find this information on your state utility commission's website.
- Energy Sources: Determine the type of energy your home requires, such as electricity, natural gas, solar, or renewable energy. Verify that the supplier offers the desired energy source within your state.
- Cost and Pricing: Understand your current energy costs by reviewing recent bills or statements. Compare rates and contract terms from different suppliers to find the most cost-effective option for your needs. Consider any additional taxes, charges, or fees that may be included in the pricing.
- Customer Service: Choose a supplier with a reputation for excellent customer service. Look for prompt responses to inquiries and handle complaints effectively. You can check customer reviews or ask for recommendations from friends or on social media.
- Contract Terms and Conditions: Carefully read the terms and conditions of the contract. Pay attention to any fees associated with call-outs, cancellations, or late payments. Understand the cancellation process and any associated costs to avoid unexpected expenses if you decide to switch providers again in the future.
- Energy Plans: Consider the energy plan that best suits your needs. Some suppliers offer fixed-rate plans that provide a stable rate for the duration of the contract, while others may offer variable rates. Choose a plan that aligns with your energy usage patterns and budget.
- Sustainability: If sustainability is important to you, look for suppliers that offer renewable or green energy plans. These plans may include options for solar, wind, or hydroelectric power, allowing you to reduce your carbon footprint.
- Comparison and Switching: Utilize comparison websites or tools to easily compare rates, plans, and suppliers. These platforms can help you find the best deal and make switching suppliers more straightforward. Remember to review any exit fees from your current supplier before making the switch.
By considering these factors and doing your research, you can choose an electricity supplier that offers the best value, excellent customer service, and a plan that aligns with your energy needs and sustainability goals.
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Frequently asked questions
The average monthly electricity cost in the US was $137 in 2023.
The average US home consumes 855 kWh of electricity per month.
Your monthly electricity bill is a product of how much electricity you use and your electric rate. To calculate your average monthly bill, multiply your average electricity usage by the monthly cost per kWh in your state.
Reducing your electricity usage is the most straightforward way to lower your electricity bill. You can also reduce costs by installing solar panels or subscribing to a community solar farm. If you live in a deregulated area, you can also switch to a cheaper energy plan.
Electricity costs vary across the US. In July 2025, North Dakota had the lowest residential electricity rate at 11.69 cents per kWh, while Hawaii had the highest at 42.44 cents per kWh.
