Watts, hours, kilowatt-hours, dollars
There is only one chain of arithmetic here and it is worth having in your head, because it turns any label into a number on the bill. Watts divided by 1,000 is kilowatts. Kilowatts times hours is kilowatt-hours, which is the unit the utility meters and bills. Kilowatt-hours times the rate is money.
A 1,500 W space heater is 1.5 kW. Four hours a day is 6 kWh a day. Thirty days is 180 kWh, and at 16 cents a kWh that is $28.80. Run it eight hours instead and it is $57.60. Nothing in that chain is subtle. What makes appliance costs surprising is not the arithmetic, it is that people carry a rough sense of what things cost from decades of habit and never notice when a device is two orders of magnitude off that intuition. A phone charger and a clothes dryer both plug into the same outlet.
| Device | Rough draw while running | 4 h/day for a month at 16 c/kWh |
|---|---|---|
| LED bulb | 9 W | about $0.17 |
| Laptop | 50 W | about $0.96 |
| Window AC, small | 500 W | about $9.60 |
| Space heater | 1,500 W | about $28.80 |
| Electric dryer | 3,000 W | about $57.60 |
Those draws are illustrative rather than specifications for any particular model. The point of the column on the right is the spread: the same four hours a day across that list runs from pennies to the price of a tank of gas.
Running time is not switched-on time
The single most common error in this calculation is entering the hours the device is switched on rather than the hours it is drawing its rated power. A refrigerator is plugged in 8,760 hours a year and its compressor runs a fraction of that. A window air conditioner cycles with the thermostat. An electric water heater sits idle between draws. A furnace blower runs when the burner does. For all of those, the nameplate watts multiplied by the hours in the day gives an answer that can be three or four times too high.
There are two honest ways around it. A plug-in energy meter sits between the outlet and the device and accumulates actual kilowatt-hours over a week, which settles the question entirely for anything on a 120 V plug. Or use the yellow EnergyGuide label, which gives an estimated annual kWh figure derived from a standard test cycle — divide that by 365 and by the rate to get a daily cost directly, and skip the watts field altogether. Nameplate watts is genuinely useful only for things that draw a constant load while on: incandescent lighting, resistive heaters, toasters, kettles.
Standby power, and how much it is worth caring about
Almost everything modern draws something while off. A television waiting for a remote, a microwave showing a clock, a printer listening for a job, a laptop charger with nothing attached. Individually these are typically under a watt to a few watts. A device drawing 2 W continuously uses about 17.5 kWh a year, which is under $3 at 16 cents.
That is small enough that unplugging one appliance is not a financial strategy, and large enough that thirty of them across a house is a real line on the bill. The useful framing is proportional rather than absolute: standby matters most for devices that are rarely used and always plugged in, and matters least for devices with a large running load. A second refrigerator in the garage running 24 hours a day is worth a hundred times more attention than the phantom draw of everything on the entertainment shelf combined.
What the rate on your bill actually is
Utility bills separate the cost of energy from the cost of getting it to you, and often several other line items besides: supply, delivery, distribution, transmission, customer charges, capacity riders, state and local taxes. The cents-per-kWh figure printed most prominently is usually the supply or energy charge alone, and it is not what you pay.
The all-in rate is the total amount due divided by the kilowatt-hours delivered that month. Do that division on two or three recent bills and you will get a figure that is stable enough to use here and frequently a third higher than the headline number. If you are on a time-of-use plan, the calculation is genuinely different — the same kilowatt-hour costs several times more at 5 pm than at 2 am, and for anything schedulable, when you run it matters as much as how long. Residential rates across the US commonly sit somewhere in the region of 11 to 33 cents per kWh, and that spread between states is far wider than any modelling error in this page.
Where this calculation stops
It gives you the cost of the electricity a device consumes, and nothing else. It says nothing about demand charges, which some utilities apply to residential customers based on peak draw rather than total energy; nothing about tiered rates, where the marginal kWh costs more than the average one you calculated; and nothing about what the appliance does to your heating and cooling load, which for a heat-producing device in summer is not trivial. If the goal is to decide whether to replace something, the running cost calculated here is one input into that, sitting alongside the purchase price, the remaining life of what you have, and what disposal costs.
Questions people ask
How do I convert watts to cost per month?
Divide watts by 1,000 to get kilowatts, multiply by the hours it runs each day, multiply by the number of days, and multiply by your rate in dollars per kWh. A 1,500 W heater running 4 hours a day for 30 days is 1.5 x 4 x 30 = 180 kWh, and at 16 cents that is $28.80. The shortcut worth remembering is that 1,000 W running for one hour is exactly one kilowatt-hour, so a kilowatt of anything costs one rate-worth of money per hour. At 16 cents a kWh, every kilowatt you switch on costs about 16 cents an hour to leave running.
What is the average cost of electricity per kWh in the US?
There is no single figure that is honest to quote, which is why the rate is an editable field here rather than a constant. Residential rates vary by state, by utility, by season and by rate plan, and the range across the country is wide — commonly somewhere between about 11 and 33 cents per kWh, with some markets outside that on both sides. Averages also move year to year with fuel prices. The only rate that gives you a correct answer is your own, and you calculate it by dividing the total amount on the bill by the kilowatt-hours it covers, which folds in delivery charges and taxes that a quoted energy rate leaves out.
Does leaving something plugged in cost money if it is switched off?
Usually a little, occasionally nothing. Anything with a remote receiver, a clock, an indicator light, a network connection or an external power brick draws standby power continuously, typically from a fraction of a watt to a few watts. Two watts continuous is about 17.5 kWh a year. A device with a genuine mechanical switch that fully breaks the circuit, or one unplugged at the wall, draws exactly zero. Whether it is worth acting on depends on the count: one device is pennies a month, and a house full of always-on electronics adds up to something you can see on the bill.
Why is my calculated cost lower than what my bill went up by?
Three usual reasons. The device cycles or modulates and you entered its peak nameplate watts, which overstates it — that would push your estimate high rather than low, so if you are low, look at the other two. The rate you used was the energy charge rather than the all-in rate including delivery and taxes, which is commonly a third of the difference. Or the device changed something else: an electric heater run in a house with a heat pump displaces a more efficient source, and any heat-producing appliance run in summer makes the air conditioner work harder to remove that heat again. Bills also carry fixed monthly charges that do not move with usage at all.