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Electricity and Natural Gas Bills – Introducing
Electricity natural gas bills are your best energy value. Remember when energy choices were easy? Electricity was used for lighting, electronics, and motors. For heating, the obvious choice was natural gas. In today’s changing energy market, technological innovations and fluctuating energy costs are causing some decision-makers to rethink energy options.
To make decisions more complicated, varying billing structures and pricing options make understanding charges challenging and effectively comparing electricity costs to natural gas. The following information will help your business or organization sort through the options and make informed decisions. As you will read, historically, natural gas has been an excellent energy value and, for most applications, continues to be a better choice than electricity.
The cost difference between Electricity and Natural Gas Bills
Because electricity is billed in kilowatt hours (kWh) and natural gas in a thermos, it can be challenging to compare costs. Delivery and other charges make it even more difficult to assess cost differences accurately. The following table adjusts for the disparities, showing actual natural gas and electricity prices for Minnesota commercial/industrial customers. As proved, even when a range of electric prices is considered, natural gas prices are steadily two to three times lower than electric prices.
When all charges are careful, for a $0.06 per kilowatt hour (kWh) electricity rate to be competitive, natural gas would have to cost $1.77 per therm. Historically and currently, natural gas costs are well below that price. The highest commercial/industrial natural gas firm rate on record is only $1.38 per therm. The higher cost resulted from 2005’s unusually active and destructive hurricane season. See Table 1 below for an electric versus natural gas price comparison.
Another consideration is that electric utilities nationwide are projecting significantly increased costs as they update aging infrastructure to accommodate increased demand. Those costs will be passed along to the consumer and could widen the gap between natural gas and electric costs.
Bills could go up a lot, especially in Texas, the largest natural gas-consuming state, followed by California. The National Energy Assistance Directors Suggestion (NEADA) estimates the average family may pay more than $1,200 to heat their home this winter. That’s $175 more than last winter, which is notable because nearly 40% of families were previously financially strapped.
The 40% of U.S. households that use usual gas could see their winter heating costs increase by a third, rendering to NEADA, which could keep inflation up. But much of this also depends on winter weather. The U.S. could be spared a considerable spike if it’s a mild midwinter.
About Electricity And Natural Gas Bills
To keep an eye on your energy budget, it is essential to fully understand the monthly energy costs and charges on your electricity and natural gas bills. When reading your electric or natural gas bills, you may wonder what electric or natural gas utility charges are, what a kWh is, how they calculate, or other issues understanding your energy bills. Constellation wants to help you achieve your energy costs by educating you about how energy consumption could affect your monthly bill.
What Are The Fees And Charges On My Electricity Bill
Electricity Bills
On your bill (or this example electricity bill), you will see a list of how much electricity your household used during the month, in kilowatt-hours or kWh. You have two ways to control this part of your bill. First, you can lower your home energy bills by reducing your consumption. Second, you can have more control by choosing a provider that offers a fixed price plan to avoid price fluctuations due to seasonal changes, power supply changes, or other external factors.
Capacity Cost
Another necessary charge to understand on your electric bill is the capacity cost. This charge, which generally applies to commercial customers, ensures that the utility has sufficient available capacity to meet all of its customers’ energy needs.
Utility Charges On Electricity Bills
Another common question regarding electricity billing concerns utility charges. The delivery charge on your electric bill is your share of the maintenance and upkeep of the line, helping you run your home or small business. Your account (like this utility bill example) may contain a different term, e.g. “Transfer fee” or something similar, but the impact on your electricity bill remains the same.
How Utility Bills Calculate?
To understand how your electricity bill remains calculated, you need to know the rates you pay and how much energy you use. Ultimately determining your home’s electricity bill. If you read your electricity bill, you will see the total cost of energy consumption for that month. It calculates by multiplying the rate you pay per kWh by the number of kilowatt-hours your home has used during the month. Knowing this formula (below) gives you an essential way to understand your energy costs.
Explanation Of Your Natural Gas Bill
Understanding your energy costs is more than understanding your electricity bill. Your natural gas bill can make up a large portion of your home energy bills. Liable on where you live and your supplier, you may need to familiarize yourself with several terms to understand your natural gas bill.
Fixed and variable tariffs are different billing plans and affect your natural gas bill. Understanding your natural gas bill becomes a bit more complex when you’re billing at a variable rate that can change. Every month. Fixed price bills are less complicated than variable rates and maintain the same rate you pay for the gas each month; usage varies.
Some Of The Most Common Terms On Natural Gas Bills
- What is a CCF? CCF is the reading of how much natural gas you used in a month, measured in hundreds of cubic feet.
- What is a BTU? A British Thermal Unit or BTU energy measurement uses to calculate. The amount of energy needed to raise the temperature of a pound of water by 1 degree Fahrenheit.
- What is a term? One therm equals 100,000 BTUs. It is usually the unit used to calculate the energy used when determining your monthly natural gas bill.
- What is the price per therm? It is the price you pay per therm according to your contract. This price may vary depending on the time of year, supply, and other cost factors. If you have a variable rate plan.
- You may also have customer service fees. Transmission fees, capacity fees, and other similar fees your state or local carrier requires.
Conclusion
The price of energy is one factor in determining fuel choice. But, it’s also important to consider price in the context of efficiency. The example below compares an electric and natural gas heating system. Even with the efficiency factor difference, the lower cost of natural gas makes it a much better choice. Use this table to help make comparisons in your facility.