Utility Bills 101: Tips, Average Costs, Fees, and More

What provides you with clean water, comfort, and energy and keeps you connected to the entire world? Here’s a hint: it’s mostly invisible during the day and night, but magically shows up on your monthly bills.

The answer: utilities

Whether you rent or own your home, utilities are a part of life and thus a part of your budget. Broadly speaking, they include the following: electricity, gas, water, garbage, internet, and cable. In addition (but to a lesser extent), there’s the landline to consider, and across the country some residents pay for recycling on top of normal garbage disposal fees. The rule of thumb—at least for apartment renters—is to budget at least $200 per month for utilities.

Unless you live “off the grid,” most of the aforementioned categories are going to cost you something, every quarter or every month. Considering that the average consumer will spend 7 percent of his or her annual income on energy, let’s take a look at what you’ll be paying for your utilities, depending on where you live and the size of your home.

infographic break down monthly utilities budget

Size does matter: Heating and cooling costs

According to the U.S. Department of Energy, the typical U.S. family spends at least $2,200 per year on energy bills—with nearly half of that paying for heating and cooling. Of course, this cost fluctuates depending on where you live, the size of your house or apartment, and the extent to which you make smart decisions about conserving energy.

Let’s start with size. For apartments, the median size in multifamily units is 1,074 square feet. The average size will likely get smaller, as more than half of new units are one-bedroom apartments or studios. A smaller apartment—if it has modern windows and is properly insulated—will cost less to keep warm during the winter and cool in the summer than a larger home.

In terms of houses, according to the American Enterprise Institute, today’s new homes, at an average of 2,690 square feet, boast living space per person that has doubled since 1973. Coupled with greater energy efficiency than their earlier counterparts, new homes are going to be less expensive per square foot to heat and cool than in previous decades.

The U.S. Department of Energy’s consumer website, Energy.gov, offers tips on how to save energy, and therefore save money, whether you live in one of the newly built studios on the market or a king-size house:  

  • Program your thermostat as closely as possible to the lowest temperature you’re comfortable with in the winter and the highest in the summer; you can always make adjustments manually if necessary.
  • Clean furnace and AC filters at least once a month.
  • Keep baseboard heaters and radiators clean of dust and debris, and make sure they are not blocked by furniture or curtains.
  • Turn off kitchen and bathroom fans as soon as possible after using them.
  • Use your curtains or blinds methodically. Depending on the type of windows you have, that can mean letting sunshine (warmth) in during winter or blocking the cold with thermal curtains; in the summer, keep sunshine out to keep your home cool.

Electricity: How much do my appliances need?

No matter how much heating and cooling you’re doing, the electrical usage  on your monthly electric bill is going to show up in terms of “kWh” or kilowatt-hours. Running an air conditioner uses far more kWh than, for example, charging your mobile phone. This chart gives detailed breakdowns of kWh use by various appliances.

The price of electricity is measured in cents per kilowatt-hour (kWh). Across U.S. households, the average price per kWh is 12.43 cents, according to the U.S. Energy Information Administration. If it seems that your electric bill is higher than ever before, that’s because it is! At the start of 2001, the price of electricity was 7.25 cents per kWh.  

How does that translate into how much you’ll need to pay per month? WalletHub.com prepared a chart of monthly averages by state (note, when looking at the total, that their chart includes the cost of fuel—a form a energy, yes, but not a “utility” that we’ll cover in this article).

There’s more to life than hot and cold: electric usage by type

While heating and cooling account for most of our energy expenditures, there’s a lot more going on inside our homes. PG&E (Pacific Gas & Electric, providing gas and electric in California) breaks down energy use by appliance, basing energy use on 14 cents per kilowatt-hour and average conditions.  

  • Air conditioner: $23–$137 per month
  • Electric clothes dryer: $0.33–$0.56 per load
  • Washing machine (cold water): $0.04 per load (not including the cost of water)
  • Refrigerator: $8.69–$9.84 per month
  • LCD or plasma TV: $0.02–$0.06 per hour
  • Cable box, standby mode: $19.98 per year
  • Hair dryer: $0.02 per use
  • Nightlight: $0.02 per month

If your housemate bugs you about all the energy your nightlight takes, be sure to give him or her your two cents.

What about natural gas?

Natural gas is used to warm your house, to keep the hot water running, and, in many instances, to cook. Gas companies typically procure the natural gas, and then charge you for gas plus the process of getting it to your home. Reading your gas bill may feel like reading a science report, so let’s get down to the most important acronym, “BTU.” It’s short for British Thermal Unit, a unit of energy.

HouseLogic.com sheds some light on how BTUs add up for the average household: “According to the American Gas Association, the average U.S. household consumes about 72.5 million BTUs of natural gas per year, at an annual cost of $992.”

Here’s a chart of the average natural gas cost by state (the term “therm” on the chart equals 100,000 BTUs). In addition to charges for BTUs, you may see some other items on your gas bill—including taxes and fees. SoCalGas is among the providers offering a detailed explanation of all the elements that add up to your total monthly gas cost. Check with your local provider for details in your state.

Taking out the trash: Your garbage bill, explained

The cost of collecting trash—on average between $12 and $20 per month—is, according to the National Solid Wastes Management Association, “one of a household’s biggest bargains.”

On average, Americans generate about 4.4 pounds of trash every day. Imagine if we had to carry that to a waste station once a week! Instead, according the Environmental Protection Agency, 100,000 trash collection trucks are out on the road daily, picking up our household garbage. Americans have become increasingly mindful about recycling, and now about 34% of our residential “waste” is taken away in recycling bins. While recycling doesn’t typically show up as a line item on your garbage bill, according to Consumers Digest, Americans with curbside recycling are being charged between 50 cents and $10 per month for the service, rolled into the garbage bill. Sometimes water, sewage, and trash are all on one bill, with one monthly fee.

Water: The price is rising

Across America, the price of water has risen 41 percent since 2010, and sewer prices and fees have risen even more dramatically during that time. This comes as a result of severe droughts in California and Texas, combined with a failing infrastructure. According to the nonprofit organization Circle of Blue, the average water bill in the U.S. is about $40 per month, based on a family of four using 100 gallons per person, per day, with a high of $73 in Atlanta.

I want my MTV: The cost of cable and internet

In the old days, “hooking up the TV” meant plugging it into the wall and adding a wire coat hanger as an antenna. Back then, television was essentially free. Today, cable prices are all over the map—and most are not regulated by the FCC. You can, of course, watch basic channels free, but the average cable bill is about $100 per month. For many companies, you can bundle internet and cable into one bill, saving money on both utilities. Otherwise, the monthly cost of your internet will vary widely based on connection type speed. Slow dial-up connections cost as little as $10 per month, but the fastest fiber optic connections can cost upwards of $150 each month.

Going mobile: Will it replace traditional utilities?

Your mobile phone, and its ability to connect to towers and via Wi-Fi, is the only “utility” you can take with you once you leave the house. (That is certainly a lot easier than strapping an electric grid to your back.)

The question of whether a mobile phone can be categorized as a utility is an interesting one. Some argue that the formal definition of “utilities” is limited to services relative to a specific location—the water you use at home, the garbage that’s picked up weekly at your curb, your home’s internet and cable connections, and the heating and cooling processes related to your domicile.

However, according to the Pew Research Center, 92% of American adults own a mobile phone, and less than half of U.S. homes still have a landline. Ultimately, mobile phones may replace other traditional utilities, as more and more people rely on them for internet connectivity away from home and use them as “hotspots” at home rather than using (and paying for) an internet connection.

On average, Americans check their mobile phones 150 times per day, according to Kleiner Perkins’ “Internet Trends Report 2016.” Some of the time spent on a mobile includes viewing movies and television, with the potential—in the not-too-distant future—to make cable a less-commonly purchased utility.

As far as the other 100 or so glances, we’re guessing that at least a few involve looking up how to save money on utilities at home. Soon, that $200 per month that you’ve budgeted for utilities may not be enough to cover the rising costs of water, electricity, and gas. As the costs of natural resources escalate, taking steps to conserve energy will help keep your utility bills in check.

Conna Shannon

Conna Shannon

Conna Shannon is a writer and aspiring filmmaker. She lives in Monterey, California, where she enjoys sailing and hiking with her yellow lab, Daisy.
Conna Shannon