Last Updated on August 28, 2022 by Mary Pressler
Why is My Electric Bill So High?
Many Texans can reduce their electricity bills by upgrading to more efficient appliances and installing solar panels. However, there are some cases where energy costs remain high even after these measures. If this is happening in your home, here are some possible causes that are not so evident.
Here are 5 possible reasons your power bill is abnormally expensive…
1) Your electricity plan is not suitable for your home or apartment
Some electricity plans look great at first, but once you check their Electricity Facts Label (EFL) the conditions are not so favorable.
- For example, they may advertise a very low kilowatt-hour price, but only after you reach a certain consumption level. By then, your monthly power bill is already high!
- There are also electricity plans with free energy periods, generally on nights and weekends, but they charge much higher prices at other times.
- Many plans show their benefits in large bold text, but you need to read the fine print to identify their less favorable terms.
We could give many other examples of electricity plans with tricky conditions, which make them seem better than what they really are. Therefore, you should always take your time to check the EFL and any other conditions when choosing an electricity provider. There are homeowners who save hundreds of dollars per year by simply switching to a better plan.
Keep in mind that some electricity providers switch you to a variable-rate plan at the end of a fixed-rate contract. If this happens, power bills can rise suddenly: You have been paying a fixed kWh price for months (or years), and suddenly that price is updated. To avoid this, look for another fixed-rate plan or renew your contract before you get switched to a variable-rate plan.
2) Your home has low insulation and air leaks
Space heating and air conditioning are the top energy expenses for most Texas homes, and they often represent over 50% of consumption in homes and businesses. However, heating and cooling costs can be even higher under the three following conditions:
- Your property uses old and inefficient HVAC equipment.
- Your thermostat uses extreme settings: the coldest possible temperature during summer, and the hottest possible temperature during winter.
- Your building envelope suffers from low insulation, excessive air leaks, or both.
In the first two cases, the reason for high energy bills can be easily identified, since you only need to check your equipment nameplates and thermostat settings. However, insulation and air leakage issues are harder to find, and your heating and cooling costs may remain high even after an equipment upgrade.
Low insulation and air leakage waste energy all year long. During summer, your air conditioner works harder to compensate for the extra heat entering your property. The opposite applies during winter, since your property loses too much heat and the space heating system consumes additional energy to keep up.
The most reliable solution to detect low insulation and air leakage is by getting an energy audit. However, if your energy costs remain high even with efficient HVAC units and smart thermostats, these issues are likely. Energy consultants can detect air leaks with a blower door test, while using a thermal imaging camera to detect poorly insulated areas.
3) Your water heater is running all the time
Older water heaters use analog controls, and in many cases their text and numbers have faded. This makes them confusing to use, and many homeowners simply leave them on to avoid the hassle. However, if you have an electric water heater, this can greatly increase your power bills. To make matters worse, aged heating systems tend to be very inefficient compared with modern units of the same capacity.
If you’re looking for an electric heater with a storage tank, buy a heat pump and not an electric resistance heater. Assuming the same heating capacity, an electric heat pump can reduce consumption by 50% or more. You can also use a tankless water heater, which remains off most of the time, only activating when water flows through. In both cases, you can find options with the ENERGY STAR label.
Even after upgrading your water heater, you could still be wasting power if the new unit is frequently left on or not configured properly. Regardless of the type of water heater you pick, we strongly recommend getting a professional installation.
4) You’re not set up to make money of excess solar energy
Did your power bills stay high with solar panels? You could be giving away your energy for free!
Solar panel systems have become very popular in the US, and if you install them before the end of 2022, you can claim 26% of their cost as a federal tax credit. However, most homes with grid-connected solar panels only use part of their electricity output:
- Solar panels are very productive around noon, while homes tend to have their highest consumption in the evening and morning (unless you work from home).
- As a result, there is a large amount of unused solar electricity around noon.
- Electricity providers will buy this electricity from you, and the amount is applied as a credit on your power bill.
In other words, when you have solar panels without an energy storage system, your home becomes a small power plant during the day. Unfortunately, some electricity providers buy extra solar power at a very low price, and there are even cases where you get no credit.
If you have grid-tied solar panels, make sure you get an electricity plan with an attractive solar buyback rate. Alternatively, you can install a battery system to store surplus solar energy, and use it during the night. However, selling your extra solar power requires no additional investment, while a battery system is expensive (often more expensive than the solar panels themselves).
5) Hidden electrical connections to other dwellings
If your power bills remain high no matter what you do, there could be hidden connections to surrounding dwellings, and in this case you’re paying for electricity used by someone else. This can happen more easily in apartment buildings and multi-family homes, where there are shared areas and walls.
- Keep in mind this could be an accident, and it doesn’t always mean your neighbors are stealing your energy on purpose.
- Maybe there was a wiring error during the construction stage, or an electrician connected a new power outlet to the wrong circuit.
- The best solution is getting your installation checked by a professional.
You can disconnect all your appliances and then check the power meter. If the device is still measuring consumption, the power could be going somewhere else. However, be diplomatic when you bring up the topic with other apartment owners – you could be dealing with a wiring error they are not aware of.