High electricity costs

For most householders, their monthly energy bill is the only indicator of how much energy is being used in the house. Sometimes the size of the bill can come as a shock.

Perhaps your bill has increased significantly compared to the previous month, or you may have discovered that you are using much more energy than your neighbours or friends and don't know why. This information sheet will look at both these possibilities to help you diagnose what is causing your high bills and what actions you can take

 If the bill is much higher than previous months there are several possible causes:

• You may be using a lot more energy for useful purposes, but you don't know it.
• New appliances
• Problems with your hot water cylinder
• There may be a problem with the bill itself
• There may have been an increase in electricity or gas prices.

If you discover your bills is much higher than your friends and neighbours there are some additional things to think about.

These include:

• Checking your hot water use
• Checking the number and condition of your appliances, plus how you use them.
• Considering whether you are on the right energy plan for your circumstance
• Checking how well your home is insulated
• Checking the way you are heating your house.

Have there been sudden changes in your bill?

Have you used more electricity than you normally do? Sudden increases to your electricity bill could be related to:

A change in circumstances

• Guests or extra people (e.g. a new baby) result in more heating and lighting, showers/baths and extra laundry which all have an impact on your energy use.
• A change in how much time you spend at home and your heating requirements; e.g. retiring from work, school holidays, or sick leave.

Cold and hot weather

• High bills in the winter and lower bills in the summer can be a sign that these peaks are related primarily to your winter heating costs. A colder month usually results in heaters and electric blankets being used for longer.
• Use of a dehumidifier or a clothes drier during the cooler months of the year.
• Slightly more energy is required to heat hot water in winter.
• Households running an air conditioner all day in very hot weather may also experience higher summer bills.
• An older refrigerator or freezer may contribute to larger energy bills in summer

New Appliances

• Upgrading or adding large appliances (e.g. a big television) will change your electricity use.
• Installing and running a heat pump all day could also increase your electricity bills.

Problems with your hot water cylinder

• The thermostat on the hot water cylinder could be faulty or set too high. The thermostat should be set to 60C°, and the hot water should come out of your taps at around 55C°.
• There may be some a fault with the hot water cylinder, or it may be very old. If you notice any hot water leaking from pipes from the cylinder this should be checked by an electrician and/or a plumber.

Problems with the bill itself

Your electricity costs could also be higher than expected for a number of reasons relating to the bill itself:

• There may be an opening balance on the bill which is included in the cost for the month. This could be because of an unpaid previous account, fees applied such as reconnection, disconnection, fault fee, etc. If you know that you paid your previous bill but this is showing as an opening balance, check with your electricity supplier because there may be an error. This is common if you have moved house recently.
• You may be on the wrong pricing plan for your circumstance. For example, you may be on a ‘low user' pricing plan but you have actually used more that the allowable units per year. This would mean any additional units would be charged at a much higher rate. You should contact your supplier to discuss the most appropriate pricing plan for your situation.
• The billing period could be more than the usual 30 days.
• The meter reading may be an ‘estimate' rather than an ‘actual' reading. If this is the case you can call your electricity supplier with an ‘actual' reading (by reading the number of units off your meter) and they can re-bill the property and cancel the estimated bill.
• The previous bill may have been under-estimated so when an actual reading was taken the account has caught up with itself.
• You may have recently changed your meter type which has resulted in a larger bill. For example you may have changed from an ‘Economy 24 Plan' to a ‘Day/Night Plan'.
• You may not be on the best energy plan best suited for your needs and use. Talk to your electricity supplier or the Energy Advice Service to identify the right plan for you.
• Please note that when meters are faulty they tend to read slower rather than quicker so a high bill is not normally the result of a faulty meter. A high bill is usually the result of an increase in energy being drawn through the meter.

An increase in electricity or gas prices

Your electricity or gas supplier may have recently increased their prices. All suppliers are required to give advance notice of an increase.

If you are concerned by this increase, check the Powerswitch website (http://www.powerswitch.co.nz/) to compare unit prices and charges from all of the electricity suppliers. This will help you to identify if you are paying the best price for your electricity, or if other providers can offer a cheaper rate.

If you are unsure how to do this or don't have access to the Internet, call the Energy Advice Service on 0800 388 588 for assistance.

Are your bills high all the time?

If your bills seem high all the time, not just during the peak winter heating season, that's a clue that some of the things you are using, or the way you use them may not be as efficient as they could be.

Hot water use

Hot water heating accounts for around 34% of electricity use in NZ homes. A high number of showers on a daily basis, long showers, baths, plus frequently washing clothes in hot water will be a substantial portion of your electricity bill regardless of the time of year.

Appliances

Electricity ‘vampires': 20% of household electricity use is now used to run all the appliances and gadgets in a house! Leaving appliances on standby (that usually means there is a light on somewhere) will use electricity even when your appliances aren't in use. Turning appliances off at the wall is one of the easiest and cheapest things you can do to save electricity. Common electricity ‘vampires' include:

• Frequent use of an electric clothes dryer
• Leaving your heated towel rail on 24 hours a day
• Frequent use of a spa pool/hot tub
• Water beds
• Faulty appliances
• Leaving televisions and computers on standby

A faulty appliance: A fault may have developed with an appliance, causing it to use excess energy.

Refrigeration: About 15% of electricity is used for refrigeration. It's worth making sure your fridge is efficient. A refrigerator older than 13 years, more than one fridge, and large chest freezers will all add up.

A fridge that has old or faulty door seals, has lost some gas or has a broken thermostat or controller may still appear to be working, but will be running a lot more often (or even continuously) to maintain cold temperatures inside. This could double or triple the cost of using that fridge.

How much does it cost to run an appliance?

If you want to find out how much individual appliances are using, energy monitors are available that plug into a wall socket and give a reading in Watts as well as the actual running cost in cents per hour for individual appliances. There are different brands but one of them is "Powermate" and they can be purchased from hardware stores such as Bunnings, Mitre 10, etc for around $25.

For up-to-date information about appliance running costs, visit http://www.consumer.org.nz/, and search for ‘appliance running costs'.

If you want to find out how much electricity your whole house is using, a Centameter measures the electricity being used and displays the cost per hour on a portable display located inside the home. You can order one of these online from http://www.centameter.co.nz/.

For more information about running costs and appliances, visit the Energywise website at

http://energywise.govt.nz/how-to-be-energy-efficient/appliances/appliance-running-costs-and-smart-use

Are you on the right energy plan? Talk with your energy retailer

If you have checked all of the above possible causes for a high bill contact your electricity supplier, tell them your concerns and ask them to explain why the bill is so high. They may be able to book a meter check for you but if there is no fault found with the meter your supplier will charge you for the visit. Alternatively, your electricity supplier can compare the current bill with the same billing period last year which may put your mind at rest. 

The Energy Advice Service can also provide an independent assessment of your energy plan.

Is your house under-insulated?

Many people do not realise the effectiveness of their ceiling insulation reduces over time. It will settle and become thinner and less effective after about 15 years, and a house will slowly become colder and more and more expensive to heat. This is easily fixed by installing another ‘top-up' layer of insulation.

The Energy Advice Service can advise on financial assistance for insulation and heating available for home owners and landlords.

Check the way you are heating your house

Running lots of plug-in electric heaters (e.g. fan, oil, panel, or convection heaters) at the same time in different rooms for long periods of time will be expensive.  Here is an example based on electricity costs of 24c/kWh) [1]:

• 1. If you run a heater at 1.2kW in the morning and in the evening (say 8 hours per day) it will cost: $2.30 per day or $64.50 per month (28 days).

• 2. If you run the same heater for 8 hours per day but on its full heat setting (2.4kW) it will cost twice as much to run: $4.60 per day or $129 per month (28 days)

Heat pumps are much cheaper to run than plug in electric heaters. A good heat pump will cost about a third of the cost of a plug in heater.

For more advice about heat pumps, including financial assistance to install one into your home, call the Energy Advice Service on 0800 355 588, or email energyadvice.cea.co.nz

[1] The actual cost you pay will depend on the tariff plan, 24c/kWh is a typical price in October 2011, including GST and the prompt payment discount. Some tariffs will be a little lower than this (e.g.all day economy tariffs) and some will be a little higher (low user, all day economy tariff).