Electricity Cost Calculator

How to Calculate Your Electricity Costs — and Slash Your Bill

Electricity bills have become one of the largest household expenses — and yet most people have no idea which appliances are actually causing the problem. Is it the tumble dryer? The electric heater you left on all night? The old fridge-freezer that's been running for 12 years? This guide explains exactly how electricity costs are calculated, which appliances cost the most, and the practical steps that make the biggest difference to your bill.

How electricity cost is calculated — the formula

Your electricity supplier bills you in kilowatt-hours (kWh) — not in watts. A kilowatt-hour is the energy used by a 1,000-watt appliance running for exactly one hour. The calculation for any appliance is straightforward:

The rate per kWh is shown on your electricity bill — look for "unit rate" or "cost per kWh". In the UK this is currently around 24–28 pence per kWh (April 2025 price cap). In the US, average rates are around 14–18 cents per kWh, varying significantly by state. In the EU, Germany and Denmark have the highest rates (28–38 cents/kWh) while several Eastern European countries are below 15 cents/kWh.

The biggest electricity users in most homes

Understanding which appliances dominate your bill is the first step to reducing it. In a typical UK home, these are the largest contributors:

• Heating and hot water — electric heaters, heat pumps and immersion heaters collectively account for 30–40% of most electricity bills
• Tumble dryers and washing machines — a tumble dryer used five times per week costs approximately £163/year at UK rates
• Fridge-freezers — running 24 hours a day, even an efficient model adds £80–£220 per year
• Electric showers — at 7,000–10,500 watts, an 8-minute shower costs around 30–40p — adding up to £100+ per year for a single user
• Air conditioning — the fastest-growing cost in UK homes, adding £500–£1,500 per year if used through summer months

In contrast, LED bulbs, laptops, phone chargers and modern TVs consume relatively little — their contribution to a bill is often overstated. The biggest savings come from high-wattage appliances, not from unplugging phone chargers.

Standing charges vs unit rates — the full picture

This calculator computes the variable (unit rate) portion of your electricity cost — the part that scales with usage. However, electricity bills also include a daily standing charge, which is a fixed fee just for being connected to the grid, regardless of how much you use. In the UK, the standing charge is approximately 61 pence per day (£222/year) as of April 2025. This means that even a household using zero electricity would still pay £222 per year.

For accurate total bill estimation, add your annual standing charge to the running cost calculated by this tool. For appliance-by-appliance comparison or "should I leave it on or turn it off?" decisions, the unit rate calculation is all you need.

How to find the wattage of any appliance

Most appliances display their wattage on a label on the bottom, back or plug. Common locations include the energy label (the EU/UK A-G rating sticker), the model plate on the appliance body, or the plug itself. The wattage is written as "X W" (watts) or "X kW" (kilowatts, where 1 kW = 1,000 W).

If you only find amps (A) and volts (V), use the formula: Watts = Amps × Volts. In the UK, mains voltage is 230V, so a 6A appliance draws 6 × 230 = 1,380 watts. In the US, standard mains is 120V (1,380 watts would draw 11.5 amps on a US circuit).

One important nuance: the wattage on the label is the maximum rated power, not the average running power. A fridge compressor doesn't run continuously — it cycles on and off. Dishwashers and washing machines vary their heating element usage through the cycle. For these appliances, the actual average consumption is typically 30–60% of the nameplate wattage. Our appliance presets use typical average consumption values rather than peak ratings.

EV home charging — is it expensive?

Electric vehicle home charging is one of the most common new electricity costs for households. The calculation is simple: Cost = Battery capacity (kWh) × Electricity rate × Charging efficiency factor.

A typical home AC charger (7 kW wallbox) has about 90% efficiency — meaning you pay for roughly 10% more energy than what ends up in the battery. For a Tesla Model 3 with a 75 kWh battery charged from 20% to 80% (60% of capacity = 45 kWh), the cost at UK rates is approximately 45 × 1.1 × £0.25 = £12.38.

Compared to petrol, this is dramatically cheaper. A petrol car averaging 35 mpg costs approximately £1.80–£2.10 per litre to fill, or roughly £0.09–£0.12 per mile. A typical EV costs £0.03–£0.05 per mile at home charging rates — making EVs around 3× cheaper per mile to run. Off-peak overnight tariffs (such as Octopus Go in the UK at approximately 7p/kWh) can reduce this to under £0.02 per mile.

How to reduce your electricity bill — the highest-impact changes

Once you've identified your biggest users with this calculator, here are the changes that make the most difference:

• Upgrade old appliances — a 12-year-old fridge-freezer may use 400–600 kWh/year; a modern A-rated equivalent uses 150–250 kWh. The saving covers the cost of the appliance within 3–5 years.
• Switch to an EV-friendly or off-peak electricity tariff — if you charge an EV or run a heat pump, time-of-use tariffs can cut your energy cost by 50–70% for overnight loads.
• Use a tumble dryer timer — running a dryer on an off-peak tariff overnight, rather than at peak time, can halve its effective cost.
• Reduce electric space heating — dropping your thermostat by just 1°C reduces heating energy use by approximately 10%. Adding draught-proofing and loft insulation reduces the hours heating is needed.
• Replace incandescent or halogen bulbs with LED — LEDs use 80–90% less energy for the same light output. A 50W halogen costs about £11.25/year at UK rates; a 5W equivalent LED costs £1.13/year.
• Check standby consumption — many TVs, games consoles, set-top boxes and smart speakers draw 5–15W on standby continuously. A device drawing 10W for 24 hours uses 87.6 kWh/year — costing £21.90 at UK rates, simply for being on standby.

Frequently asked questions