How to work out what electricity costs you
Every UK electricity bill is built from two numbers: a unit rate for each kWh you use, and a standing charge you pay every day just to be connected. This electricity cost calculator multiplies the first by your usage, adds the second for 365 days, and splits the total into months and quarters. Nothing else goes into the bill, so once you have those three figures you can check any quote, tariff or direct debit yourself.
The formula
Annual cost = (annual kWh × unit rate) + (standing charge × 365). At the price-cap rates of 26.32p per kWh and 54.83p a day, a home using 2,700 kWh pays £710.64 for the energy and £200.13 in standing charges — £910.77 a year, or £75.90 a month.
The standing charge does not move when you use less. That is why cutting usage saves less than people expect, and why low users feel the standing charge most.
Where to find your numbers
Your unit rate and standing charge are printed on every bill and in your supplier’s app, usually under “tariff details”. Annual usage is on the bill as an estimate, or you can take two meter readings a few weeks apart and scale up — though usage is higher in winter, so a summer reading understates the year.
A smart meter shows daily kWh directly. For more on reading the bill itself, see unit rate vs standing charge.
What a typical UK home pays
Ofgem uses three benchmark usage levels when it sets the price cap. Here is what each costs at the rates above, standing charge included.
| Household usage | kWh a year | Energy | Standing charge | Total a year | Per month |
|---|---|---|---|---|---|
| Low (flat, 1–2 people) | 1,800 | £473.76 | £200.13 | £673.89 | £56.16 |
| Medium (typical home) | 2,700 | £710.64 | £200.13 | £910.77 | £75.90 |
| High (larger family home) | 4,100 | £1,079.12 | £200.13 | £1,279.25 | £106.60 |
Electricity only, at 26.32p/kWh and 54.83p/day. Homes with electric heating or an EV can use several times the high figure.
Why your bill differs from the average
Household size and routine
More people means more washing, cooking and screen time, but usage does not scale evenly — a second person adds far less than the first. Being at home in the day matters as much as headcount. Our guide to average electricity usage breaks it down by household.
Heating and hot water
Most UK homes heat with gas, so electric heating is the biggest single reason a bill runs far above the table. A 2kW plug-in heater used four hours a day adds 8 kWh — over £2 a day at the cap rate. Compare systems with the heating cost calculator.
Big appliances
A tumble dryer, immersion heater or electric oven can each cost more a year than the fridge, TV and lighting combined. The appliance running cost calculator ranks them so you can see which one is worth changing habits for.
Tariffs, the price cap and time-of-use rates
The price cap is a limit on rates, not bills
Ofgem caps the unit rate and standing charge a supplier can charge on a standard variable tariff, and reviews them every quarter. It does not cap the total you pay — use twice as much and you pay roughly twice as much. Fixed tariffs can sit above or below the cap.
Because both rates change each quarter, re-run this calculator when the cap moves rather than relying on last year’s bill.
Economy 7 and smart tariffs
Time-of-use tariffs charge less overnight and more in the day. They pay off only if a real share of your usage moves into the cheap window — storage heaters, an immersion heater, or charging an electric car. Check the day rate before switching: if it is well above the standard rate, a household that uses most of its power in the evening can end up paying more.
Charging a car is the clearest win. See what it is worth in the EV charging cost calculator.
Cutting the bill, in order of what it saves
Start with the biggest users
Every 10% cut from a 2,700 kWh home saves 270 kWh, worth £71.06 a year at the cap rate. The standing charge stays, so the saving is always smaller as a share of the bill than as a share of usage.
- Heating: lower thermostat settings and fewer hours of plug-in heat
- Drying: air-dry when you can, or a heat pump dryer
- Washing: 30–40°C cycles instead of 60°C
- Hot water: a timer on any immersion heater
Then look at generation
Once usage is down, solar panels reduce what you buy at the unit rate. Every kWh used at home from your own roof saves the full 26.32p, which is why daytime usage matters so much to payback. The solar panel calculator shows the numbers for your roof, and cutting an energy bill covers the smaller wins in order.
The long view
Small monthly amounts add up. If prices rise 3% a year — the assumption behind the projection chart above — a £910.77 bill totals about £33,200 over 25 years for the same usage. That is the figure to weigh against insulation, a heat pump or solar panels. A measure that saves 10% of the bill is worth more than £3,300 over that period before any change in prices.
These are estimates from the rates you enter, not a supplier quote. Your actual bill also depends on meter readings, the exact date your rates changed, and any discounts or debt on your account.