How to Estimate Electric Bill for a New House

When purchasing a new home, many buyers understandably focus on mortgage payments, property taxes, and insurance costs. However, utility expenses, particularly electricity bills, can also make a significant impact on your monthly budget. Estimating the electric bill for a potential home before purchasing can help you better understand overall living costs and avoid unexpected financial burdens.

Gather information from the current homeowner

One of the easiest ways to estimate electricity costs is by asking the current homeowner for past utility bills. This can provide real, location-specific data that reflects actual usage patterns. With a previous utility bill, you can also compare their current electricity with other electricity plans.

Tips for asking homeowners for utility information:

There is a chance the seller is hesitant to share utility information. If that is the case you can try any of the following approaches:

Explain that utility costs are an essential factor in the purchasing decision for your offer.
Offer to sign a non-disclosure agreement if privacy is their concern.
Request an average of electricity costs rather than full bill details.
Check with the local utility provider, as some may provide past billing data upon request.

Questions to ask the homeowner

If you succeed in acquiring a recent utility bill, it would benefit you to ask these questions so you can understand how electricity bills may fluctuate throughout the year.

What’s the average monthly electricity cost? This provides a baseline for what to expect throughout the year.
Are there seasonal fluctuations? Some homes may have high summer cooling costs or increased winter heating expenses.
What type of heating and cooling system is in place? Older systems may be less energy-efficient which can be replaced & reduce your energy usage.
Are any of the major appliances rated ENERGY STAR Efficient? Appliances like refrigerators, washers, and dryers can significantly impact electricity usage.
How well is the home insulated? Poor insulation can lead to higher heating and cooling costs.
Are you signed up with a fixed or variable electricity rate plan? This can affect how much you pay per kWh over time with seasonal fluctuations in energy usage.
Are there additional power-consuming features? Pools, hot tubs, or electric vehicle chargers can add to the monthly electricity bill.

Leverage online energy calculators

If past energy bills are available, online calculators can help estimate electricity costs based on home size, location, and appliance usage. One such resource is our energy cost calculator, which allows you to input details to estimate monthly electricity expenses. The information you will need from the past utility bill is outlined below:

kWh usage: This measures exactly how much electricity was used in a given time period
Energy rate: The price per kWh that you pay to your retail electricity provider
TDU delivery rate: The per kWh charge you pay your regional utility for maintaining power lines and delivering electricity to your home
TDU monthly delivery charge: TDUs charge a flat monthly fee, along with the per kWh rate, to maintain electricity infrastructure.

Manually calculating your own energy usage

If the homeowner isn’t able to provide a past utility bill for any reason. You can follow these steps to estimate how many kilowatt hours your appliances and devices require. This will only be applicable if you know the exact appliances you plan to use.

Find the energy label for the major appliances you plan to use and look for the wattage.
Then divide that wattage by 1,000 to get the energy usage in kilowatts. (1000 watts = 1 kilowatt)
Next, calculate the kilowatt-hour usage of each appliance. Then, multiply the kilowatts by the average number of hours the appliance is used per day.
Take that average daily kilowatt-hour rate & multiply it by 30 to get the usage in an average month.
Lastly, multiply the average monthly kWh usage of the appliance by your average kWh rate on the Electricity Facts Label of the energy plan you are signing up for to get the electricity cost of that appliance.

Research local energy costs

Electricity rates vary widely depending on location, electricity provider, and regional policies. The time of year is also a factor in estimating energy usage and costs. In Texas, electricity is often cheapest between late February and early May, and mid-September to early December. During these months energy companies typically offer lower prices due to demand being lower at that time.

Researching local rates will give you a better sense of potential costs. A few good websites that the Public Utility Commission of Texas maintains are:

powertochoose.org
powertosavetexas.org

These sites can help electricity shoppers to find low rates. When shopping there, be careful to avoid potential gimmicks that make plans appear cheaper than they actually are.

Factors affecting energy costs & electricity usage

Local kWh rates: Look up the average cost per kilowatt-hour (kWh) in the area
Climate and weather patterns: Homes in extreme climates (like a Texas summer) may have significantly higher electricity usage due to heating or cooling needs
Thermostat settings: Research shows that in Summer every degree you raise the temperature, you can save up to 3% on your cooling costs
Age of HVAC system: On average HVAC systems last 10-15 years. Upgrading to a modern & more efficient model can help reduce energy usage
Age of roof: The type of shingle, materials used, the insulation levels, and the roof angle will all affect the heat retention or the ability of cool air to escape
Major appliances: According to data from the EIA, refrigerators alone make up 8% of total average energy usage

Tips to Lower Electricity Costs

If after your analysis the projected electricity bill seems high, there may be opportunities to reduce costs after purchasing the home.

Upgrading insulation & windows: Proper insulation reduces heating and cooling demands
Replacing old appliances: Energy-efficient appliances consume less power
Installing smart thermostats: Automated temperature control can optimize energy usage
Install dimmer switches: Switch from regular on/off light switches to dimmer switches to control the brightness of your bulbs

In summary, the best way to estimate your electricity bills is by using real, location-specific data. The most accurate data will be previous utility bills. If those aren’t available, researching local energy costs and manually calculating your monthly energy usage will be the next best way to estimate your electricity bills.

Simple fixed rates lead to lower bills

At BKVE, we offer straightforward, no-gimmick electricity plans designed to help Texans save money. The transparent pricing and excellent customer service we offer are perfect for first-time homebuyers or existing homeowners buying a new home.

Enter your zip code today to compare your options and find your plan.

Written by Graham Lumley

Graham Lumley, Digital Marketing Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 8 years of marketing experience, he creates content to help consumers understand and save on their energy bills, bringing a fresh and dynamic approach to the industry.