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- We're all paying more than we used to for electricity, mostly because we keep using more.
- Electricity takes more of our income as time goes by, unless income goes up too (which hasn't been happening lately).
- Your options to deal with this - use less, pay less, (or earn more). We recommend all three. Alphabuyer can help you find a better rate now, and in the future.
The price of electricity for residential customers has increased over the last decade, but only modestly. One kilowatt-hour of electricity cost 8.43 cents on average in the US (in 1997 dollars), and 11.26 cents in 2008, according to figures from the U.S. Energy Administration.
When adjusted for inflation, a kilowatt has actually stayed fairly flat. But keep in mind the cost of a kilowatt-hour is only one factor in what you're paying. How much electricity you use can obviously have a big effect on your overall bill.
Here, we see the trend has been ever upward. While appliances and electronic devices have become more efficient, we've added more of them, and also upgraded to more power-hungry devices like flat-screen TVs and more powerful PCs. According to the Bureau of Labor Statistics, here's what's happened to average electricity usage in US residential households over the last decade:
The Spending Picture - More money, and more of our income
When we put both factors (price and amount used) together, we see a slow but steady rise in the amount of money an average retail customer actually spends on electricity over the same period. In 1997, the average US household spent $847.11 on electricity, compared to $1,243.71 in 2008:
This trend becomes more unsettling when we take into account the effect this has had on household budgets. Household incomes were still growing through the late 1990s, but as income growth has leveled off, electricity has started taking a bigger and bigger bite.
In other words, we are typically spending more of our available money on electricity than we did ten years ago, and that trend seems likely to accelerate as both prices and usage slowly rise, especially while income growth remains stagnant.
Reversing the trend
Most of us have one option for keeping electricity from taking more of our income – reduce demand through conservation. This is a good thing to do, but as we've seen, we keep finding more ways to use electricity. For those of us who live in places that have been opened to competition, we can also try to reduce our costs by shopping around for a better rate, which can have an immediate impact. Real opportunities to save money on electricity by switching suppliers do exist in some regions of the country, but finding them requires researching what competitors (if any) are offering service where you live, what their prices and terms are, and comparing them to your current usage and cost. If you do find a better price, you'll need to re-evaluate frequently to make sure you're still getting the best deal, since prices change frequently.
That's where Alphabuyer can help. We constantly research the competitive market region by region, talk with alternative suppliers, and negotiate for the best overall rates and terms for our members. We make the shopping process easier by bringing you only truly competitive, relevant offers, and explain the terms and switching process in simple, straightforward language. Once you enroll, we'll ensure a smooth switching process. Best of all, we'll keep an eye on your contract for you, let you know when it’s time to shop around again, and suggest a best option. We want to make it easy to save money on your electric bill now – and keep saving, year in and year out.