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How to calculate the energy cost of appliances

Summary

By knowing the right formula and ‘watt’ each appliance consumes in electricity, a landlord and tenant splitting an electric bill can divide it fairly

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Question for the CreditCards.com expert

Dear New Frugal You,
I need to figure out how much it costs to run two box fans for 24 hours a day, seven days a week. Also, what about a small high-velocity floor fan and long, shop-style fluorescent bulbs? We’ve been stabling a horse in a barn on property that we own but rent out. The tenants say that their electric bill went from $70 to $170! I had agreed to give them $30 a month. We’re in a major heat wave, and I’m betting it’s their air conditioning, but you know how that goes. Can I prove how much electricity my fans and light are using? — Carl

 

Answer for the CreditCards.com expert

Dear Carl,
So you want me to get in the middle of a landlord-tenant spat? OK, but only if you leave my name out of it! Let’s see if we can’t help you prove your point. I think that a few facts and a little math should help clear things up.

Let’s start by checking out how many kilowatt-hours each item uses and how much a kilowatt-hour costs where you live.

A watt is the standard measure of how much electricity is used. A kilowatt is simply 1,000 watts (kilo = 1,000). A kilowatt-hour (kwh) is 1,000 watts used for one hour.

Most appliances have the wattage listed on an attached plate. You’ll need to convert that wattage to kilowatts. It’s simple. Just divide the wattage by 1,000. So a 1,500-watt hair dryer used for one hour is 1.5 kwh. Burning a 250 watt lightbulb for an hour is .25 kwh. If the serial plate doesn’t include watts, you can multiply volts times amps to get watts. Of, if the model is sold online, its specs, including wattage, can often be found there.

Now let’s figure out what a kwh costs. According to the U.S. Energy Information Administration in April 2011, the average cost per kwh was 9.65 cents. You can find out what it costs in your area by checking your most recent electric bill.

So how much electricity are you using? We went shopping online and found typical box fans range from 40-100 watts. At the midpoint, 70 watts, if a kilowatt costs 10 cents per hour, the fan would cost 0.7 cents per hour (0.07 kwh x 10 cents). Extend that out to a month and it works out to $5.04 per month if it runs around the clock (0.7 cents per hour x 24 hours x 30 days). Two fans would be just over $10 per month.

Now for the high-velocity floor fan. We found one rated at 135 watts. So at 0.135 kilowatts per hour, that would cost $9.72 per month if used continuously. You can see how your fan compares.

The fluorescent bulbs are a similar calculation. To keep it simple, let’s suppose that he has a fixture that includes two 50-watt bulbs. So they’d consume 100 watts per hour. That would work out to about $7.20 per month (.1 kwh x 10 cents x 24 hours x 30 days).

So how much would you owe the tenants for “your” share of the power consumption? If you total them up, it would come to $27 per month.

Now let’s see what air conditioners should cost. Depending on size, window units should cost between 7 cents and 12 cents per hour of use. Central air costs three to four times what an individual unit does.

Let’s assume that the ones that the tenant is using costs 9 cents per hour and run 12 hours per day. Each one would cost about $32.40 per month. So it wouldn’t be unreasonable for three of them to consume $100 of electricity per month.

So who’s right? I can’t be sure because of all the assumptions in my examples, but if my estimates of power consumption are close to the equipment you have, you are. Get over there for a visit, take down the wattage of your equipment and crunch your own numbers to be sure. My back-of-the-envelope estimate says it looks like you’re being fair, but now you have the tools to make a visit to find out for sure. By the way, as a goodwill gesture, I’d include bringing fresh filters and a toolkit to make sure your air conditioner system is running as efficiently as possible.

If you’re interested, the U.S. Department of Energy has a page to help you estimate the electric usage of various appliances. Use it to help you estimate how much it costs to run some of your appliances.

One final thought: Many local power companies offer low-cost or free energy audits to see where the electricity is going, and they suggest methods to stop it from being wasted. That sounds like it could be a win for the electric company, you and your tenants. It lowers the strain on the power supply, and it means less money out of the pockets of you and your tenants. A triple-frugal play!

See related: How to reduce your electric bills, Want to cut electricity? Beware ‘phantom loads’

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