Learn How to Read Your Electricity Bill

Energy bills can be frustrating to understand — between complicated terms and confusing additional fees, many customers aren’t sure what they’re reading. To help reduce confusion, we’ll lead you through the main sections on your bill and explain what each charge means, using a sample bill from Gexa Energy. To start, let’s review the two main sections on your bill: the account summary and electricity usage details.

Your account summary contains details specific to your energy account. Here’s what this section entails:

Section A: Your personal account details

This first section of your bill contains information about your electric account. Here, you’ll find your:

• Account number: Your electric account has a unique number that you can use to locate your account online and pay your bill.
• Amount due: This is the current balance due.
• Due date: You must pay your bill by this date to avoid a late fee.

Section B: Account summary

The account summary section breaks down your energy charges. It will also provide your previous balance for comparison. Here are some terms included in this section:

• Opening Balance: This is the amount due from the previous billing cycle.
• Balance Forward: If you have a remaining balance from last month, you’ll find that charge here.
• Electricity Charges: This is the amount you owe based on how much energy you used for the current billing cycle.
• TDU Charges and Taxes: Your energy bill includes a charge from your utility company for delivering electricity. TDU stands for “Transmission and Distribution Utility.” This line also includes taxes from your local and state governments.
• Total Amount Due: This is your total balance, including all additional fees, due for the current month.
• Applicable late fees: If your bill is overdue, any late fees will be included in this section.

This second section provides a more detailed breakdown of your electricity usage over the past billing period as well as the additional charges on your bill.

Section C: Electricity usage details

Your home or business has an electricity meter that records your energy usage, and your energy provider uses this information to calculate your bill. The most important part of this section is your total kilowatt-hour (kWh) usage. This number is multiplied by your electricity rate to determine how much you pay each month for energy.

Tip: If you want to know how much electricity you use each month, review the “kWh usage” box. It also helps to compare this section across multiple months to learn how your usage fluctuates.

Section D–F: Total charges and taxes

These sections list your delivery charges, taxes, and energy charges. Our example from Gexa Energy pertains to Texas local and state taxes.

• Billing Period: The date range for this billing cycle.
• Energy Charge: This section takes your kWh usage, displayed as units, and multiplies it by your electricity rate to get your energy charge.
• PUC Assessment: The Public Utility Commission of Texas (PUCT) charges utility companies a fee to service each address. This fee is passed on to consumers on their bills.
• TDU Charges: Your utility delivery charges are twofold: a base fee for the billing cycle, and a charge per kWh of energy consumed. Your plan’s Electricity Facts Label (EFL) outlines your exact utility delivery fees.
• Gross Receipts Tax Reimbursement: The PUCT charges energy providers a fee to operate in deregulated areas. Providers then charge consumers the gross receipts tax reimbursement to cover the cost.

If you’ve read through your charges but suspect something is off, follow these steps to investigate your bill:

1. Compare your current bill to your previous bill. By comparing the two bills, you can easily find out if you used more energy than in the previous period, which could be the cause of a higher bill.
2. Call your energy provider. Since your provider manages your account, a representative can check your bill to determine if there were any errors. Your provider can also explain the details of your energy plan in case there may be something you missed that’s causing an uptick.
3. Next, contact your utility company. Your utility company is responsible for managing your meter and can make sure it read your electricity usage correctly. Although it’s uncommon, there could have been an error with your meter.
4. Lastly, file a complaint with the PUCT. If you’ve contacted both your provider and utility company but still believe your bill was wrong, you can file a complaint with the PUCT. The PUCT manages energy providers and can investigate your claim.

Can I avoid TDU charges?

There’s no way to avoid paying TDU charges. Every customer’s utility company charges delivery fees, which help keep the power grid safe and reliable. These delivery fees are regulated by the PUCT to ensure fair pricing. TDU charges update on March 1 and September 1 each year.

Who do I contact with questions about my energy bill?

Contact your energy provider with questions about your bill or electric account. Your energy bill should include contact information for your provider and instructions for paying your bill.

How is my energy bill calculated?

Your energy bill contains three main elements: your energy charge, utility delivery fees, and taxes — the sum of those three elements results in the total cost for your energy bill.

How do I pay my bill?

Most providers offer the ability to pay your bill online, by mail, or over the phone. Some may also offer in-person locations. You should be able to find the payment methods your provider offers at the bottom of your electricity bill. Check with your provider if you are unsure how to pay your energy bill.

How can I reduce my energy bill?

The most direct way to reduce your energy bill is to use less electricity. Easy tactics include turning off lights and electronics when not in use, lowering your HVAC usage, and limiting hot water. You may also want to consider smart home upgrades like a smart meter, LED lights, or energy-efficient appliances.

What is a kWh?

A kilowatt-hour (kWh) is a unit of measurement that indicates how many kilowatts of electricity an appliance or device uses in one hour. Your energy bill is also calculated using kilowatt-hours. The number of kWh you use each month is multiplied by your energy rate to determine the main portion of your bill.