Understanding Your Electric Company Bill – A Complete Breakdown

Understanding your energy bill can feel like a daunting task. It’s filled with lots of vague terms and fees.

Many moving parts can influence your electricity costs, whether you’re on a fixed rate plan or a variable one. Understanding these charges will help you identify opportunities for cost savings.


Understanding the charges that make up your electric bill and how they can affect your energy costs is important. Your bill is broken down into two sections: Supply and Delivery. The Supply section covers the costs associated with the electricity you use in your home. This includes the kWh rate and your usage total. The kWh rate on your home energy bill can vary depending on if you live in a regulated or deregulated market. In a deregulated market, you can shop and find better rates for your home energy needs.

Generally speaking, utility companies use a system that involves “tiers.” This means you pay less for electricity when you consume below certain thresholds. Once you pass those thresholds, the kWh rate increases. This is a way to help control peak demand on the system and keep prices lower for all customers.

A Corpus Christi electric company offers plans that allow you to lock in a fixed price for your contract term. This helps you avoid market rate fluctuations, which can change by season and time of day. It also allows you to budget your energy costs for the length of your contract. To get started, you can compare electricity rates in your area by entering your zip code below.

Meter Readings

The next section of your bill shows the total amount of electricity your home used in kilowatt-hours (kWh). You have some control over this number by working to reduce your home energy usage. Other controls include avoiding variable-rate plans and choosing a fixed-rate plan.

The meter reading is an important part of the kWh consumption portion of your electric bill. A physical meter reading can be done in one of three ways: Actual, estimated, or average. Actual means someone from your energy provider comes to your property and physically reads the meter. Estimated is when a company estimates your consumption from historical data. Average is when the company adds up the past month’s usage based on your meter reading and other information.

Some meter meters have dials that turn, while others are digital. If you have a dial meter, write down the first five numbers on your meter from left to right (ignoring any red numbers). If you have a digital meter, you should see two numbers on your display – the top row is labeled ‘low’ or ‘night,’, and the bottom is ‘normal.’ You’ll need to give your supplier the top and bottom readings.

If you have an NYSEG meter, the letter A or E at the end of your meter reading indicates that a meter reader couldn’t access your meter. This will result in an estimated meter reading for that billing period, which can cause significant variances in your monthly charges. The best way to avoid these variances is to learn how to read your meter yourself and send in the readings.


A “home energy” charge on your electric bill refers to the electricity you use in your home during a billing period. This is listed in kilowatt-hours (kWh). You have some control over this portion of your bill by working to reduce your consumption.

However, you also control your price for this energy by comparing rates and finding a competitive supplier. When you shop, compare the rate and additional utility charges like grid connection fees, distribution service charges, late fees, and low-income assistance charges.

Besides energy consumption, your bill will show two types of demand – actual and billing demand. The actual demand is the average of your 15-minute demand for that month, while billing demand is based on your highest demand for previous months.

If your peak demand is a concern, you can work to reduce your demand by scheduling appliances for non-peak hours and by reducing usage during those times. This is especially important during summer when your demand will be higher than normal. If you’re on a time-of-use plan, your electric company will offer pricing that rewards you for using power during off-peak times and penalizes you for using it during peak periods. This is called demand ratcheting.


There are several different fees that your electric company charges for services. These can include metering, billing, and customer service charges. However, supply and delivery rates are two of the most important. Supply rates cover the energy used in your home, and delivery rates include the costs of delivering the electricity through local power lines.

The supply rate is the actual cost of the electricity you use measured in kilowatt-hours (kWh). This is calculated by multiplying your current usage by the applicable rate. Many utilities also include tiers within these rates, which is how they try to control demand. These tiers are generally based on how much usage you have above your baseline. This can be a good way to save money by reducing your energy consumption during peak periods, which vary depending on the season and location.

Another bill component is called a capacity charge, a flat fee that covers the electric company’s costs for ensuring it has enough capacity to meet your electricity demand. Larger businesses often incur this fee, but it can also be seen on residential bills. It is a good idea to contact your electricity provider for more information on how these fees are determined since they change throughout the year.

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