Table of Contents
With rising electricity costs in South Africa, finding ways to save money on our monthly bills is becoming increasingly important.
The best way to start saving money is first to understand how your electrical bill works, including your tariffs, service fees, and usage. Then, you can start analysing how you use power so you can find ways to reduce it or change your usage patterns.
Now, let’s examine the basic steps to help you understand your bill so you can start saving money today.
Why Understanding Your Electricity Bill is Crucial for Budgeting
You need to understand your electrical bill to know what uses the most power in your home. With knowledge of your usage, you can start reducing your power consumption or changing your usage patterns. Then, you can save money to put back into your household budget.
Essential Steps for Verifying Your Electricity Bill
Here are the essential steps to verify your electrical bill so you can learn how to cut your monthly costs.
Step 1: Confirm Your Account Information
This step may seem unnecessary, but mistakes happen, and sometimes, customers can be charged for their neighbours’ consumption. Examine the account number, service address, and meter number on your monthly bill and confirm that they match your home address and your meter number.
Such information will also be necessary when you make a payment or need to contact your electricity provider about your account to negotiate better rates.
Step 2: Key Elements of a Standard Electricity Bill
Next, it’s essential to understand the structure of your electrical bill, which can vary depending on your provider, location, and tariff schedule. Here are the terms used and what they mean.
Service Charge
A service charge is a flat daily or monthly fee that covers the utility company’s administration and maintenance fees and does not vary with how much power you use. It’s the fee you pay each month for having your home hooked up to the electrical grid.
Active Energy Charge
The active energy charge is measured in kilowatt-hours (kWh), where a kilowatt (kW) is 1000 watts, and a kWh is the kW that you use over a set period of time.
This fee is based on how much electricity your home uses between your previous and current billing periods. Sometimes, in rural areas, estimates are used until someone can come out and reread your meter.
Network Demand Charge
The network demand charge varies monthly based on the actual electrical demand. It is the highest kVA (kilovolt ampere) recorded over 30 minutes during that billing cycle.
While this one is perhaps the most confusing of the fees, it can be thought of as how the electrical company recovers the cost of generating electrical capacity that sits idle until you need (demand) it. This is why it’s based on your highest usage demand. Therefore, the higher your demand on the grid, even if not continuous, the higher your monthly cost will be.
Step 3: Understanding Your Electricity Tariff Structure
Different tariff (pricing) structures are available in different locations with varied providers. It’s the specific active energy charge you pay per kWh for power; different tariffs will also have different service and network demand fees.
Your maximum power demand, the meter type (single or three-phase electrical connection, prepaid electricity, etc.), and the voltage supply can also affect your tariff rates.
Tariffs are variable and unique to your home, so you must read your bill to learn your tariff rates. Contact your provider if you have questions and negotiate with them to find the most cost-effective tariff structure for your needs.
Step 4: How to Analyse Your Electricity Bill
Next, analyse your bill. Remember, the service fees are flat rates that will not change with usage, although they will change if you re-negotiate your tariff. Let’s examine the part you control most: your active energy charge.
Active Energy Charge = kWh used x rate/kWh
For example, if your rate is R3.30 and you used 100kWh, you will pay:
100kWh x R3.30/kWh = R330
If your provider uses an estimate over a three-month average, record the amount and period of the estimate from your bill and watch it in the following month(s). You’ll be charged for any extra you used above the estimated amount, or you should receive a credit if the estimate is higher than your actual usage.
Step 5: Track and Monitor Your Energy Consumption
Now, we can start tracking and monitoring our consumption.
First, look at how many watts your appliances use so that you can identify where most of your power is being consumed. Heaters, air conditioners, water heaters, and dryers all use a fair bit of energy.
Next, compare your previous bills from the same time last year to your current use. Also, compare your use during the different seasons. It helps you identify changes in your usage that increase or decrease your costs.
Step 6: Practical Tips for Lowering Your Electricity Bill
Now that you understand your usage, you can start finding ways to save money on electricity. For example, you can switch to more energy-efficient appliances, use LED lighting, seal your doors and windows, and monitor your thermostat better. Anything you can do to use less power saves more money.
If you really want to lower or even eliminate your electrical bills, consider installing solar panels on your home, such as the EcoFlow Solar Panels.
For instance, the EcoFlow DELTA Series Solar Generators have solar panels and a portable power station. You can get a smaller hybrid system to supplement your power and reduce monthly costs. Devices like EcoFlow DELTA 2 Max + 220W Solar Panel and EcoFlow DELTA Pro + 400W Solar Panel are fantastic options to begin saving today.
Alternatively, thanks to their expandable capacity, you can get a large enough system to go off-grid completely, run even the most power-hungry homes, and never have to pay your utility company again.
Frequently Asked Questions
The most efficient way to save electricity is to learn your usage patterns. Examine your bills and compare them to previous years and in different seasons. Look up the watts used on your appliances and see which ones use the most power. With this knowledge, you can reduce your consumption and save money.
The best way to lower your electrical bill is to use less energy around your home with better insulation, sealing doors and windows, adjusting your thermostat, and using energy-efficient appliances. Also, consider switching to clean, renewable solar energy. After the solar payback period, your energy could be free for 20 years.
Final Thoughts
Understanding your electricity bill is a great way to save money. It will tell you when and where you are using the most power, allowing you to take action to reduce your power consumption and reduce your monthly costs.
Of course, the best way to save the most money or eliminate those pesky bills altogether is to use one of EcoFlow’s Solar Generators. It will also provide energy independence, and you won’t have to worry about the grid going down again.