Operating Cost Resource

Interactive Sizing & Electrical Reference

Understanding the Electricity Bill

Your electricity bill is based on how much energy you consume over a billing period, usually measured in kilowatt-hours (kWh). To calculate how much a specific appliance costs to run, you need to understand the relationship between watts, time, and your local electricity rate.

The Conversion Steps

Follow these steps to determine the cost of running any device:

1. Find the Wattage

Locate the power rating on the appliance's label. This is usually listed in watts (W). If it only lists amps (A) and volts (V), use the formula: Watts = Amps × Volts.

2. Convert watts to kilowatts

Since utilities bill in kilowatt-hours, you first need to convert watts to kilowatts.

Kilowatts (kW) = Watts ÷ 1,000

3. Calculate Kilowatt-Hours (kWh)

Multiply the kilowatts by the number of hours the appliance runs.

kWh = Kilowatts (kW) × Hours of use

4. Calculate Cost

Multiply the kWh by your local electricity rate (cost per kWh).

Cost = kWh × Rate (e.g., $0.15)

Worked Example: Space Heater

Let's calculate the cost of running a 1,500W space heater for 8 hours a day, assuming an electricity rate of $0.15 per kWh.

  • Kilowatts: 1,500 W ÷ 1,000 = 1.5 kW
  • Daily kWh: 1.5 kW × 8 hours = 12 kWh
  • Daily Cost: 12 kWh × $0.15 = $1.80
  • Monthly Cost (30 days): $1.80 × 30 = $54.00
Tip: Devices like refrigerators or AC units cycle on and off, so they don't draw their maximum wattage continuously. For these, use the estimated annual kWh usage on the EnergyGuide label.

Common Household Appliances Costs

Appliance Avg Wattage Avg Monthly Usage Est. Monthly Cost (@ $0.15/kWh)
Refrigerator300W - 800W50 kWh$7.50
Desktop Computer200W120 hrs$3.60
Central Air Conditioner3,500W200 hrs$105.00
LED Light Bulb10W150 hrs$0.22

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