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I’ll show you my Electricity Bill if You show me Yours

With the feel-good articles of the Weekend Edition behind us, it’s time to get back to some hard numbers and some moneymakin’.

After slicing your car expenses, which we’ve done a lot recently, one of the next big areas with room to simultaneously save money and preserve some clean breathing air is your electricity consumption. How much are you using? Where does it all go? Are there ways to cut the waste without cutting the actual amount of fun you have in your household?

The answer is a definite YES. Check the following out:

From the website of the US Department of Energy, we see that,
“In 2008, the average annual electricity consumption for a U.S. household was 11,040 kWh, an average of 920 kilowatt-hours (kWh) per month. Tennessee had the highest annual consumption at 15,624 kWh and Maine the lowest at 6,252 kWh.”

“Meh”, you may say. “Those numbers don’t mean much to me”. Well how about this:
“A Hundred and Ten Bucks Per Month at a typical electric rate of 12 cents/kWh”
(note that electricity rates vary widely even within the US – yet another useful factor to consider when choosing a place to settle).

Note that a Kilowatt Hour means using 1000 watts for one hour – a very bright old-school light bulb (100 watts) for 10 hours or an electric clothes dryer (5000 watts) for about 12 minutes.

Yet here in the MMM House, I just looked back at the past year’s electric bills and did some math. Our average is 299 kWh per month, less than one third of the US average.*  

(Update: since writing this article almost two years ago, we’ve made a few improvements and nowadays the average is a further 30% lower, at around 200 kWh/month).

This surprised me**, because I have a pretty big house (2600 square feet), a family of three, a big shiny double door fridge, very nice lighting, and we cook and “work” at home – computers and dishwasher get used almost every day. I also use lots of power tools and even do occasional electric welding here. Why do other people use three times as much electricity than I do for my admittedly luxurious lifestyle?

Using a simple energy meter and doing some calculations, I figured out that my 299 kWh are getting used up like this:
Fridge: 47
Lights: 60
Dishwasher: 40
Furnace blower (winter) or Air Conditioner (summer): 50
Computers: 36
Clothes Dryer: 30
Tools and other/unknown: 36

If the average household could get their energy use down to Mustachian levels, they would save about $75/month or $13,725 every ten years including compounding. So how can they do it?

I believe the big three would be these things:

Clothes Drying: your dryer is the biggest energy hog in the house. It costs 60 cents per hour to run it, which sounds cheap unless you are one of those fools who do two loads of laundry per day, in which case you burn $39/month versus the MMM family’s $3.60. We accomplish this by doing only about two loads per week (you only need to wash clothes, sheets, or towels if they actually LOOK or SMELL unusual – otherwise just hang ’em up and use ’em again). And hanging the clothes to dry most of the time, saving the dryer only for things that are annoying or time-consuming to hang like huge armloads of socks and underwear. Start hanging up your pants and shirts, I’m not accepting excuses on this one. You have plenty of free time now that you’ve cancelled your cable TV.

Lighting: This seems amazing to me, but many, many people still use old-fashioned incandescent lights in their house. Tons of them. These things are STUPID. If you are one of these people, get up from your chair RIGHT NOW. Take out ALL YOUR RIDICULOUS BULBS AND SMASH THEM. Put in LED bulbs in all fixtures.

These days, they give you an even better light color than the old incandescent style, if you stick to bulbs with a high CRI rating (color rendering index) and a color “temperature” of between 2700 and 3000K.

Here’s a shortcut to the bulbs I use in my own houses and commercial buildings, updated for late 2017:

Normal base bulbs: just grab anything from Costco, Home Depot, or these from Amazon.

Recessed (Can) Light Bulbs: These Hyperikon bulbs are top-of the line and still only about $6

Track Light Bulbs: most track lights use 120 volt GU10 bulbs. I am now using these generic bulbs from Amazon and they are incredibly good. High CRI, perfect color, and dimmable.

Basic screw-in bulbs only cost only about $1.50 each, and they save you about $8.23 per year each. That is an 549 percent annual return on investment. And you can easily get dimmable versions if needed. Go change all the bulbs right now, then punch yourself in the face once for each incandescent bulb you were still using, now, in the year 2011, more than ten years since CFLs became available. Then come back to your computer and finish reading this article. Welcome back. Remember to turn off lights you’re not using as well.. duh.

Air Conditioning: This costs 35-60 cents per hour that you run it. If you go crazy with it, you can burn $100 or more in a month.
But here there is a valid difference for some people. In the US, the whole bottom right quarter of the country is an absolute steam bath for half of the year. Mr Money Mustache wants you to cut out your waste, but not your comfort. So there’s going to be some serious air conditioning going on there. But you can keep it efficient by running the machine mostly at night and coasting through the peak hours with the windows and doors closed, keeping out the heat. Block any direct sunlight with insulated curtains. And chill the house only to 80 degrees and wear shorts, instead of being like the old folks who keep their places like a meat freezer and wear sweaters around indoors during the Miami summer.

And for the rest of us, like my beloved neighbors here in Colorado who are already using their A/C all around me, use the climate to your advantage. If it is cool at night, open the windows up entirely and use a window fan or whole house fan to blow out hot air all night while you sleep. A big fan burns 1 cent per hour of electricity, 50 times less than a whole house air conditioner. I do this, and even in July I can coast through a 100 degree day with the house staying cool all day – just long enough to open up for the next cool night.

If you hit those big three, an average person should be able to at least cut the bill in half.

And there you go, another 13 grand or so towards your retirement 10 years from now. Amazing, isn’t it!?

*Another interesting note about my house – last year I rented it out to some international friends who happened to be visiting the US for exactly one month while we were away on a long trip. The usage by the tenants for that month was 971 kWh, just a bit more than the national average. So there you have it – usage is controlled by YOU, not your house or your location.

**Actually, it didn’t surprise me, because obviously I’ve been watching my electricity usage for decades and know exactly how much I use. I mean, come on, I’m Mr. Fuckin’ Money Mustache!! But I thought it flowed nicely to say, “this surprised me”.. and more importantly I thought it might surprise YOU, Junior Mustache.

  • Beth Mackey July 29, 2020, 10:01 pm

    Hey MMM – I realize this post is not a recent one, but the content is still extremely relevant so I’ve returned to it for reference. Unfortunately, your link to the simple energy meter on Amazon is no longer working. Can you share details on the actual product? Thanks much.

    Reply
  • Daniel October 16, 2020, 3:00 am

    Thank you for the article, after reading it I immediately ordered 25 LED bulbs, even if our consumption is very low (147 kWh for two months). We had an even lower consumption before the pandemic, and I hope we can return to the sub 50 kWh/month level by using more frugal ways of lighting. Disclaimer: no A/C, 1 fridge, no freezer, no electric oven, no dryer, no electric water heater, 2 TVs, and 2 laptops and 2 cell phones “constantly” charging.

    Reply

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