Electricity Cost Calculator

The calculation itself

Watts times hours divided by a thousand gives kilowatt-hours. Multiply by the rate and you have the cost.

The division by a thousand is the only thing that trips people: a watt-hour is the natural product, and the meter counts in kilowatt-hours.

In practice

A 100 W device running five hours a day uses 0.5 kWh. At 15 cents that is 7.5 cents a day.

Which sounds like nothing, and is $2.25 a month and $27.38 a year. Same device, same load — the only thing that changed is the window you look at it through.

That is the whole argument for showing the annual figure as the headline. Nobody changes behaviour over seven cents; a good many people would change it over twenty-seven dollars.

Standby power is the same trick in reverse. Five watts continuously seems ignorable and comes to 44 kWh a year, more energy than a high-wattage device used briefly ever consumes.

Getting the two inputs right

Wattage first. The rating plate gives a maximum rather than an average, and anything that cycles — fridges, freezers, air conditioning — draws its rated figure only part of the time. A plug-in energy meter gives a truer number than any nameplate.

Then the rate. Use the one your bill actually implies, including per-kWh delivery and distribution charges, not just the headline supply rate. In many markets the delivery component is a third or more of the real per-unit cost, and leaving it out understates every answer here proportionally.

Time-of-use tariffs complicate it further: the same appliance costs different amounts depending on when it runs, which is exactly the calculation that makes shifting a dishwasher to overnight worthwhile.

Where the figure deceives

This costs one load. A bill is every load plus standing charges, and tiered tariffs price later units higher — so the marginal cost of adding a device can exceed your average rate.

It also assumes constant draw. For a cycling appliance the honest input is average power over a day rather than nameplate wattage, and those can differ by a factor of three.

And it says nothing about whether a replacement is worth buying. That needs the difference in running cost set against the purchase price and the remaining life of the old device — a payback calculation rather than a cost one.

Acting on it

Rank your loads by annual cost rather than by wattage. A modest continuous load usually beats a large intermittent one.

Meter anything that cycles before trusting the nameplate.

Use your marginal rate, including delivery charges, when deciding whether an efficiency upgrade pays.