How to spot errors in your utility bills

Category: Personal Finances


Most of us assume that our monthly utility bills are correct, and many people will simply pay them without giving them a second thought or scrutinizing the cost breakdown. Some people even have their utility bills set up on an automatic payment deduction schedule, and even though they might receive bills through the mail or to their email, many don’t bother even looking at them. But you may want to think twice about that: statistics show that between 6 and 10 percent of all utility bills contain errors.

The best way to notice any errors in your utility bill is to know how your charges are broken down, in addition to what certain terms mean. This way, it can be easier to spot any inconsistencies and if something seems off, you can take action to set things right.

Electric base rate and fuel costs

Both of these charges are made up of the amount of energy consumed in your home. It will usually make up the biggest part of your overall bill. The “base rate” takes into consideration your energy consumption and the charges needed to produce it. Production expenses include things like power plants and utility personnel and delivery, but not fuel. The fuel fee covers the expense of gas to keep the utility’s power plants running. This fee will fluctuate throughout the year depending on the utility’s fees for fuel, such as natural gas and coal. These fees are measured in kilowatt hours (kWh).

Fuel costs and gas delivery

This is similar to the charges above, but these charges are measured in therms (TH).

Basic or customer charge

A flat fee encompassing routine administrative and business expenses.

Extra surcharges and fees

Your bill may include miscellaneous fees for an array of things, including upgrades to infrastructure, fees for renewable energy, installation of smart meters, and so on.


Any state, local, state and federal taxes will be included on your bill, and they help make up your overall charges.

Billing period

The overall amount of days included in the billing cycle, which will also indicate your last meter reading and the date of the next one.

Meter number(s)

The identification number of the meter used to monitor the amount of energy you use. Some households use more than one meter. As such, your bill may include numerous numbers.

Rate class

There are many different rate types, such as commercial, residential, and industrial. Make sure that your home bill is categorized as residential.

Meter and usage

This part of the bill outlines information regarding the use of electricity in your home during the billing period. It may also include past usage and comparing your previous bills to your current bill.


Your electric company may include messages on the back of your bill to help you interpret any unique charges. Be sure to check these and ensure that everything is correct, so that you aren’t overpaying.

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Nothing above is meant to provide financial or tax advice. You should meet with appropriate professionals for such services.

Tags: eco friendly, monthly bills, Utility Bills

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