What Are Utility Bills

Do you think you know everything about utility bills? Either yes or no, this “What Are Utility Bills” will give you a clear picture.

Utility bills are very important in our everyday lives because they cannot do without. Therefore, in this article, I will discuss the meaning and its type in detail.

That’s not all; I will explain the utility bills extensively, especially on the electric bill, which is the most used utility across the globe. Also, I will take you through some ideas on saving costs on utility bills.

Without much ado, let’s dive into the article.

Utility Bill Explained

Utility Bill Explained

Whether in homes, apartments, or businesses, we cannot turn a blind eye to how vital utilities are. In economics, utility is simply the usefulness and satisfaction a consumer gets from goods or services.

Utilities are basic services that we need for proper functioning and to have a comfortable living. It includes electricity, water, natural gas, sewer, trash, and recycling.

That said, utility bills are invoices that give details on services consumed daily, and it is issued at the end of each month. People who use these services include households and businesses.

Moreover, businesses are usually charged more than an average household because they utilize more of these essential services.

Notably, businesses have more accounts and charges to monitor; therefore, they will need more of these essential services to function properly. Overall, a utility bill is a monthly statement that shows the number of essential services that a business or household utilizes.

Regardless of the services you consume, a total amount and usage of the service will be issued through the utility bill at the end of every month. A utility bill has basic information like the account number, invoice number, service address; that is, the address of the building and the service period.

Further, the meter carries more detailed information on how these services are used, including the amount due. Precisely, you will see if there are any new bill adjustments, new charges, and the total charges.

The cost of utilities can always vary. This depends on the location, the type of service, usage, and the size of your home or business.

Ultimately, the main factor that determines the utility cost is its usage.

Seem like you’re already gaining some information. Read further to know the types of utility bills.

Types Of Utility Bill

Types Of Utility Bill

There are different types of utility bills used to pay for different services. This section will give a breakdown of these types of bills.

Electric Bill

An electricity bill is a detailed invoice issued to either a household or business at the end of every month stating the total usage of the power/electricity for the month. It is the most popular and important type of bill issued across the globe.

Even more, this bill is calculated using a reading meter that is installed in every premises that uses this service. In terms of payment, businesses or consumers can pay for these services via online or physical payment- however, this depends on the location.

Above all, this service is charged according to its usage.

Gas Bill

Just like the electric bill, the gas bill also gives information on the total amount of gas used during a billing period by its consumers(households and businesses). Further, the amount charged for gas may vary due to your location.

The retail price for gas in location A may be lower than location B. As such, this affects the amount each consumer in these locations is billed at month-end.

Furthermore, gas bills also vary according to your household’s size and the number of gas-powered devices it contains.

For instance, for a larger home with appliances like furnaces and water heaters that require gas to function, the monthly bill will inevitably be higher. However, this will not be the same for a small home with lesser gas-powered devices.

In a nutshell, the gas bill is based on the amount your household consumes per month. In America, the average gas bill of a household per month will be $63.34 per month in 2021.

Water And Sewage Bill

Expectedly, this bill gives details about water consumption and sewage disposal that a household utilizes per month. However, many factors can influence water and sewage bill.

These factors include; water usage, local cost of water and sewage, rate structures, and the size of the water meter. However, water usage is the main factor influencing the bill because of its importance.

Even more, water usage varies based on the local climate and weather patterns, and location(city or country). For example, people who stay in the country are more likely to consume water than those in the city.

Your electric bill can also encompass water and sewage use for the month in some locations. The average water and sewage bill a household consumes per month is $70.93 as of 2021 in America.

Trash And Recycling Bill

Do you know that waste removal is a type of utility you consume?. Formally, It is called the trash and recycling bill.

This bill comprises the cost of disposing of garbage, recyclables, and organic waste. In some cities, there are different bins for different types of waste.

Thus, these bins are picked up at different rates. The billing and charges of removing trash can be manipulated depending on the authority of the state.

If you want to save cost on recycling and trash bills, you can reduce your garbage pickups or make use of a smaller garbage cart. Also, you can pay on a monthly basis if you want the city to pick up your waste every week.

In some areas or states, your trash and recycling bill may contain other city services you receive within a period. In 2021, the average trash and recycle bill in America will be $14.03

Internet, Telephone, And Cable Bills

Bills such as cable TV, internet, and telephone are utilities you enjoy as an individual. So, there are not classified as public utilities, but most people sign up for these services.

Services like this include internet connection, phone services, and cable TV. Hence, you can buy these services from different providers, and you will be charged according to what you need.

There are services providers who deliver services for the internet, TV, and phone. Further, you can either opt for internet, TV, and telephone plan(optional) services or just the internet and TV services.

Keep in mind you will be charged differently for any of these services you need.

Instead of relying on these services providers and spending more, you should buy your personal or home route if you can afford it. Alternatively, you can use media streaming in place of cable television.

However, these streaming services cost relatively lower than cable television subscriptions. Thus, the average internet and cable bill in America as of 2021 is $116 per month.

Having known the meaning and types of utility bills, the information won’t be complete without having the knowledge of the factors that affect these bills.

The next section will expose you to these factors. Read further.

Factors That Affects The Utility Bill

Factors That Affects The Utility Bill

There are some factors that affect the cost of utility levied on consumers and businesses during a billing period. These include;


One factor that can affect utility cost is where you live, as cost varies between areas or states. For example, electricity, water, or gas costs have different rates in different locations.

When consumptions rise, the price also increases. So, for example, the gas bill will become less during the summer as people will no longer need heaters for their home—likewise, the cost of electricity bill increases, when the consumption of air conditions rises.

In a nutshell, the weather condition and location can influence the prices of these essential services you consume.


This talks about the amount of services that a household utilizes. Hence, the more you consume these services, the more costly they yield.

For instance, in electricity and gas, the only way to monitor this usage is to install a thermostat.

Most smartphones can let you track your usage either weekly or monthly in recent times. It gives you a clear understanding of how you often turn off or on your cooling and heating system.

Also, it helps you to raise or reduce the temperature at given times. Not only that, it helps to turn off the system completely to save money eventually.

The bottom line is not to be charged too much; you have to be more calculative on your usage.

Energy Efficiency

Another factor that affects utility cost is how energy efficient your home is. Again, the help of insulators and windows will influence the average cost in a household.

Hence, when there are no insulators or properly installed windows to protect air transfer, energy can escape easily. Also, another thing that can contribute to heat loss is old, single-pane windows.

Size Of Your Home

The size of your home goes a long way to impact utility cost. A large house will consume more utility than a small apartment.

Thus, heating, cooling and lighting a home as large as 2500 square feet will cost more than a small home of 1400 square feet. This is because spaces with open floor plans cost more to heat and cool, unlike houses with separate areas.

In these homes, It is possible to shut the vents or doors regularly when the rooms are not in use and don’t require either cooling or heating.

Understanding Utility Bills: Electric Bills

Understanding Utility Bills_ Electric Bills

Here I will be explaining the charges and fees of an electric bill and how you can calculate this bill.

The way to understand your electric bill is by knowing your energy cost and the line items that you can see on your invoice. To understand this further, you need to get a copy of your electric bill.

Thus, each bill is divided into various home charges that may vary from the services. So, the next question here is, “what are the charges and fees on my electric bills.”

What Are The Charges And Fees On My Electricity Bills

What Are The Charges And Fees On My Electricity Bills

Electricity Cost

On your bill, you will see a listing of the amount of electricity your home makes use of in a month. It is usually listed in Kilowatt-hours or kWh.

However, there are two ways of controlling this part of the bill. One way is to work on cutting down the energy charges in your home by reducing your usage.

Another way is to control your bill is by selecting a supplier that offers a fixed-rate plan. This will help to avoid instability in rates that happens because of changes in seasons, energy supply, or other factors.

Capacity Cost

This is an important fee that you need to understand on your electric bill. Hence, this fee ensures that electricity has enough available capacity to cover their consumer’s total power use demand.

Most times, commercial consumers usually obtain this fee. However, oftentimes, you don’t have much information on assessing this rate.

However, you can try to control it to help lower the cost of all users. For example, you can do this by using major appliances and machinery when there is less demand for them.

Also, energy consumption can be reduced during busy hours. Although these busy hours vary by location and season, you can contact your provider for guidance on avoiding peak usage times in your area.

Delivery Charge On Electric Bills

Another thing on electricity that brings concerns is the electricity delivery charge. On the electric bill, you will see a delivery charge which is your part towards maintenance.

Regardless, the impact on your electric bill remains the same.

How To Calculate Your Electric Usage

How To Calculate Your Electric Usage

Knowing how to calculate your electric bill is more than knowing just the rates you pay. Thus, you need to also understand how much energy you are using because it is what determines the electric charge of your home.

Here I will give you a basic way to calculate your energy cost. The thing you observe from your electric bill is the amount of Kilowatt-hour you make use of in the month.

Unfortunately, you can not tell the amount of electricity your appliance consumes. Hence, you will find this helpful method;

First, you need to find a silver label on your appliance which shows the wattage of the appliance. Then, you will now divide that wattage by 1000 to get the appliance’s energy use in kilowatts.

After this, you will multiply the kilowatts by the average number of hours the appliance is in use. Then, multiply that number by 30 days.

Finally, the average number of kilowatt-hours your appliance uses in the month is the result you get.

How To Save Money Your Utility Bills

How To Save Money Your Utility Bills

How To Save Money On Your Electric Bills

It is important to know that some appliances and electronics use more power than others. For instance, running a cloth dryer consumes more energy than when you charge your mobile phone.

Here are some ideas for saving cost

Saving Tips

Here are some saving tips on your electric bills

First, it is important to unplug your electronics and appliances when not in use. As easy as this sounds, many times, people forget about it.

Also, try replacing your bulb with energy-efficient alternatives. This will help save cost because it consumes less power than a regular bulb.

Another thing is that you can also consider using solar panels as another option. This will help you save money on electricity and increase your home value.

Most water heater uses either natural gas flame or electricity to heat water. However, an electric water heater costs more than a gas one, increasing your electric bill.

Hence, if you use an electric heater, replacing it with gas-powered appliances is advisable to help you save on electric bills.

Another thing that will help you save money is to invest in smart power strips. This will save you from the trouble of unplugging the electronics and appliances when not in use.

How To Save Money On Your Gas Bills

In some areas, gas prices are quite expensive more than in other areas. For instance, the residents of Point A pay more for gas than Point B.

Most people use gas to keep the house warm in winter and keep how water runs and cook. Due to this, gas consumption most times is usually higher, especially during the winter season.

Hence this can further increase your gas bill. Here are some ideas on saving money

Saving Tips

First, you should try to replace the air filter of the furnace. This is because a dirty air filter can slow down the airflow through the furnace.

The effect of this is that it will cause it to work harder, thereby using a large amount of gas. Therefore, it is advisable to use a new filter once in three months and check the filter monthly during either summer or winter.

Also, you should perform annual maintenance for your furnace. This is because the furnace may not operate efficiently by not maintaining it.

The impact of this is the harder the furnace has to operate, the more it increases your gas bill. Also, you need always to set up filter reminders to replace your filter often.

How To Save Money On Your Water Bill

The way to reduce your water bill is to use less water. Therefore, it is essential to pay attention to your daily water usage.

Hence, you need to consider how you use water and see if you reduce it each time while still getting your satisfaction.

You can cut back on your water usage by taking some basic steps, for instance, turning off your tap while brushing your teeth.

Also, you can take shorter showers. For example, if you take a more extended shower initially, you reduce the timing. This will help save the amount of water you make use of daily.

However, this tiny change goes a long way to save your water bill.

How To Save Money On Trash Bill

Sometimes, water, sewage, and trash bills are all in the same invoice with their monthly charges. However, these are some ideas of saving costs for garbage or trash.

Saving Tips

The best way to save money on garbage is to create less waste. In some places, they charge for garbage collection services per bag.

Hence, the fewer the bag, the less they charge you. In a case where it is a private company that collects your trash, you need to find the one whose charges are lesser.

This will also help to save cost on your trash bill.

How To Save Money On Cable Tv, Internet, And Phone Bills

Saving Tips

You might want to reconsider your cable bill to see if there are lower packages for your cable bill. Hence, there is no need to pay for extra channels you are not watching.

Sometimes, you can do a bundle of both internet and cable into one bill, which is a wise way to save on both. Also, you can save costs by using streaming services like Netflix and forging cable tv.

With these streaming services, you can get multiple subscriptions which may cost just as much like cable tv or even lesser.

For the internet, Just as the cable tv, you should not be paying for the internet you don’t use. This will further reduce your internet speed and lower your data usage.

Also, it is better to buy instead of renting a modem or a router from an internet service provider. This is because buying your modem or router will help you save costs in the long run.

The best way to save is by watching out for mobile carrier promotions. Often, you will see promotions that advertise discount prices on phone plans and even on new smartphones.

Also, If you have concerns about your mobile data each month, it is better to opt for a prepaid data plan. Prepaid plans are mostly cheaper than the standard post-paid plans.

However, major mobile carriers have prepaid options to choose from.

My Conclusion

My Conclusion

Utility bills are very important in our day-to-day activities. This is because they help us keep a track record of how we use our utilities.

Hence, with utility bills, we can caution ourselves on using these services carelessly. Moreover, these bills are limited to a house and even small businesses.

I hope this article will give a clearer picture of the utility bills. Also, It will be helpful to be in control and manage our utilities wisely.

I hope you found this PowerVersity pick helpful?

If you found it helpful, kindly share your thoughts with the “Leave a Reply” form found towards the end of this page.

Finally, you may want to read other articles like this. Visit our below pages.

What Is An Electrical Fuse; Best Home Electrical protection

Electrical Panel Board Explained; Electrical Distribution Board

What Is An Electrical Switch

Oreoluwa Falujo
Oreoluwa Falujo is a content writer at PowerVersity.com. She has a B.Sc. in Political Science. She loves watching movies playing games and listening to music. Oreoluwa writes buying guides, reviews, and best pick articles for PowerVersity.com.


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