How can you lower your utility costs around the house and save money while doing better for the environment at the same time? The first step is to do an inventory of where your utilities usage currently lies and figuring out how to improve on each area where possible.
The average utility bills add up to around $4,779 per year in the US which can be higher in areas that see extremely hot or cold weather due to the significant costs of heating and cooling. Electricity, natural gas and water charges can vary widely by region too.
These days it isn’t difficult to find water efficient products for virtually every water-using application in your home. You can also decrease bills in other areas often by simply changing a few small ways you do things. In other cases, little to no actual effort is required.
Average utilities cost per month
The average monthly utility costs total $4,778.88 per year. Here is how they break down on average.
| Utility | Monthly cost |
| Electricity | $110.76 |
| Natural gas | $72.10 |
| Water | $70.39 |
| Cable tv | $85 |
| Internet | $60 |
| Trash/recycling | $14 |
| Total monthly cost | $398.24 |
These costs are all per household and may be split among several or more people. The list excludes cellphone bills which Consumer Reports says costs $120 – $240 per month for a family of four which significantly adds to the above-mentioned costs but for most people is pretty much a must-have.
Electricity use in the home
As the table above shows, the average household spends $1,329 per year in electricity with some estimates that as much as 35% of usage is wasted. The average residential customer in the US pays 13.31 cents per kWh so you can compare that with how much you pay locally.
AC and heating is by far the biggest and costliest source of energy usage in a home. Certainly more so if you live in a very hot environment in the summer and cold one in the winter.
Here is a breakdown on how the average household uses electricity in the home.
| Electricity use | Percentage of usage |
| Air conditioning and heating | 47% |
| Water heating | 14% |
| Washer and dryer | 13% |
| Lighting | 12% |
| Fridge | 4% |
| Oven | 4% |
| TV and equipment | 3% |
| Dishwasher | 2% |
| Computer | 1% |
While many of these costs are ones that we don’t think about much and probably shouldn’t bother trying to control (computer, tv and equipment) others such as AC and heating, water heating and washer and dryer usage are worth paying attention to because there are things we can do to lower the cost of each.
AC and heating
Ensure that your home is properly insulated. Keep shades down during the hot sunny summer days to keep heat out and thus reduce air conditioning costs.
Use a programmable thermostat to lower heat overnight by several degrees can save 5% or more on heating costs. Similarly raising the temperature overnight by a few degrees on your AC and using a bedroom fan can make up for the extra few degrees without noticing a difference. What you will notice is lower cooling costs and money savings.
Learn about the R-rating for your current furnace and whether or not a furnace replacement may save you money in the long run. You may also investigate the use of a heat pump as some climates are suitable for one instead or – or in addition to – a furnace.
Water heating
You can lower your water heater to 120° if it is set higher than that. Most people will find 120° is high enough for hot showers but hotter than that increases your energy costs higher than they have to be.
Another quick way to save on water heating costs is to wrap your hot water pipes in the basement with foam or some other insulation. Switching to low flow shower heads can be done quickly and will further lower hot water usage and thus both water and electricity costs.
A standard tank water heater uses a great deal of energy and constantly heats water whether it’s in use or not (ie. overnight). A tankless water heater may save you money in the long run especially if you live in a smaller home or live by yourself and have limited hot water requirements.
Washer and dryer
A front load washing machine uses less energy and less water than a standard top loader so it can save on electricity, water and hot water which in turn saves on electricity or gas depending on how your water is heated.
Don’t use your washer when it’s half full. Fill it to the appropriate maximum level. Use a cold water cycle rather than hot. Consider air drying clothes when possible.
Electricity hogs
Increasingly, electronic devices are left plugged in around the clock without much thinking about it. The problem is that they slowly – and sometimes substantially – consume power even while they’re just sitting there (over)charging and not being used.
The worst electricity hogging devices that remain plugged in include:
- Anything plugged in with a charger that is not shut off at the socket
- Anything with a digital clock and/or memory feature
- DVRs and cable boxes
- Laptop computers
- DVD players
- Modems and routers
- Video game consoles
- TVs
- Older electronics such as stereos
When possible unplug items like laptops and phones when they are fully charged. Use a power strip that can be shut off with one switch and also look for ENERGY STAR rated products that are more energy efficient than others.
And don’t forget the obvious: Don’t leave lights on for no reason, keep doors and windows tightly shut when heating/cooling is on and get air gaps and other energy leaks fixed.
Natural gas use in the home
The average household spends $865 per year on natural gas. It’s a very reliable source of energy but can also fluctuate wildly in terms of price during the year. It also varies wildly by state from the most expensive (Hawaii) which is over 5 times as costly as the cheapest (Alaska) for residential customers.
The most common uses of natural gas in the home include a gas-fired furnace and other space heating, pool heater, fireplace and gas appliances such as a stove and barbeque. For most people it’s the gas furnace and gas water heater that costs the most money.
Learn more about the most energy efficient furnaces which can help to significantly reduce your gas costs if you have an older less energy efficient one.
Water use in the home
The average household spends $845 per year on water. Fresh, clean flowing water is something many of us take for granted more so when you consider what we waste. Alaska has the most expensive water bills while Florida has the lowest.
While not a complete list here are some of the main ways we use water in the home regularly that consume the most.
| Water use | Water usage |
| Toilet flush (older model) | up to 3 gallons per flush |
| Toilet flush (dual flush low flow model) | 1.1 – 1.4 gallons per flush |
| Bath | 20 – 50 gallons per bath |
| Shower | 7.5 – 25 gallons depending on length of shower and water flow |
| Washing machine (front load) | up to 13 gallons per load |
| Washing machine (top load) | up to 40 gallons per load |
| Dishwasher | up to 4 gallons per cycle |
| Faucet | up to 2.2 gallons per minute |
| Brushing teeth | 0.25 – 4 gallons each time |
| Cooking | 1 gallon per day |
| Coffee/tea | 1 gallon per day |
| Washing hands | 6 gallons per day |
| Water softener | 20 – 25 gallons per regeneration |
| Underground water sprinkler | 0.04 – 4.58 gallons per minute per sprinkler head |
| Water loss | varies but 30 gallons per day is around average per home |
Click the links in the above table to learn more about how each of those options can help you save money by reducing consumption with better, water-saving technology.
Water loss is a big problem that appears small: A slow drip in a faucet. A slow leaking toilet. It adds up.
And if you have a pool, water loss through a leak in the liner or a concrete foundation crack can be hidden since it’s normal for a pool to lose water through evaporation so you may assume it’s natural and do nothing to address it.
Cable TV use in the home
Depending on what channels you choose, you can expect to pay up to $1,020 per year for cable TV but prices fluctuate wildly these days and there are deals to be had. Cable TV prices are fairly close throughout the US and with more people cutting the cord and getting rid of it, it’s likely over time to be less of a concern and cost to consumers.
If you still want cable, your best bet is to avoid getting locked into a long contract and play companies off against one another to get the best discount possible. Prices should continue to go down and often bundling cable with Internet may help to lower your price further.
Internet use in the home
Average yearly Internet bills are around $720 but this can vary depending on the type of service you have, the speed and your location. Over time high speed Internet service has become a must have for the average person and is widely available at fairly similar prices.
As with cable TV, prices may be better if you bundle another service with the same provider such as cable or your cellphone. Looking to replace their dwindling cable revenues, some cable providers are adding new services such as home security monitoring which may also be bundled to save more.
Trash/recycling in the home
Trash and recycling costs come out to about $168 per year and may not actually be separated out on your bill. Most people are used to simply putting trash and recyclable goods outside for collection on a schedule and be done with it.
If you want to save money on trash and recycling and further help the environment, you can try to reduce the amount of garbage you put out and recycle as much as you can. This includes using clothing donation services to avoid throwing out clothes, reducing the consumption of packaged goods, making an effort to only buy packaged goods that can be recycled and also consider adding a composting bin to your backyard to reduce food waste.
While you’re at it, you can get a rain collection barrel to save rain water which will further reduce your water bill.