High electricity costs can often be a rude awakening. None of us want to see our hard earned cash or profits consumed by an electricity bill. It doesn’t take a genius to understand that when the temperature outside spikes either in an upward or downward direction, the temperature in your home will go up and down accordingly; so of course you expect your utility usage to go up and that means either higher gas or electricity bills. However, that is a rather simplistic view. It is a culmination of indirect and direct factors that affect production and consumption that will result in your bills being higher or lower than you expected.

There are several factors which can affect your bill:

As temperatures soar or dip, this may make your heating or cooling equipment run longer and at maximum capacity – thereby using more electricity.

In just a few days extreme temperatures can cause your bill to be markedly higher.

During extreme weather your system works harder to cool or heat your home and may struggle to maintain an ambient temperature.

In places with a humid climate, humidity affects how the air holds the temperature and the natural reaction is to lower the thermostat to make the home more comfortable. Humidity does not change the thermostat reading; however, it may result in the thermostat staying at the same setting for longer periods of time. Also the more humid the air is, the more water collects on the coils- resulting in the unit running longer.

Outside of your home, the climate also impacts our energy bills by driving up, or lowering, the price of electricity in the market.

Prices of natural gas and electricity are dictated by supply, demand and storage. For example, in warmer parts of America, Americans use more electricity for air conditioning and less natural gas oil and wood for heating. This peaks demand in the summer months, putting pressure on the energy infrastructure. Natural gas is the fuel of choice for meeting the peak electrical demand of air conditioning season across the USA. In times of high demand, more gas has to be taken from storage which is a more expensive way to generate electricity. Higher air and water temperatures also affect the efficiency of how the power plants convert fuel into electricity.

Climatic anomalies like the polar vortex skew the prices upward further. Cold weather burdens all types of power generation, including gas, coal, and nuclear power plants. Some generators experience extended run times. This often results in unplanned shutdowns. In addition, high “ancillary” costs are incurred to ensure grid and transmission reliability. Suppliers may absorb these costs or, as happened this year, pass them on to customers as a one-time-only line item on a future electricity bill.

If you are or have experienced higher than usual bills, or you want to find ways to reduce your electricity bills to more manageable levels, please take advantage of our complimentary bill analysis and energy audit. We will identify areas where you can save. Click the link for quick access to our Energy Advisor tool.