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Paying monthly energy bills is no one's idea of fun, and can be especially painful when you get an unexpectedly high bill. Fortunately, even if your latest energy bill was jaw-droppingly steep, you have options for handling it. You can pay a high energy bill by looking for financial assistance programs, tapping your emergency fund or tightening your belt temporarily to cover the cost.
Why Is My Energy Bill So High?
Several factors could be contributing to a higher-than-usual energy bill.
Energy Prices Are Rising
Although wholesale costs of electricity and natural gas (which many utilities use to produce electricity) are projected to drop in 2024, those savings don't always translate to your energy bill. Most energy providers are investing heavily to modernize systems, protect their infrastructure against extreme weather and repair systems after climate disasters—and are passing these costs on to consumers.
Visit your energy provider's website to compare your year-over-year energy usage. If you're paying more this year for the same amount of energy, rising rates may be to blame.
You're Running Outdated Appliances
On average, an older refrigerator uses 35% more energy than an Energy Star certified model, according to the U.S. Department of Energy. An energy-efficient dishwasher, fridge, or washer and dryer can eventually pay for itself in energy savings. Some energy-saving appliances even qualify for rebates, making them more affordable.
Your Home Has Air Leaks
Precious hot or cool air can escape through gaps in door and window frames, leaky ducts or poorly insulated walls, attics and basements. Feel for drafts from doors and windows with your hand or run a lighted candle around door and window edges to see if it flickers. Your utility company may offer energy audits either online or in person to spot potential leaks, or you can do your own energy audit.
Depending on your income, you might qualify for the U.S. Department of Energy's Weatherization Assistance Program, which modifies homes to boost energy efficiency.
Your Energy Usage Has Risen
Have recent changes to your lifestyle increased your energy usage? For example, kids home from college for summer break could mean soaring energy costs if they take long showers or crank up the A/C. Maybe you've shifted from an office job to working from home, so you're using more energy during the day. Unusual weather could pump up your energy usage, too, if you're constantly adjusting the thermostat to stay warm or cool down.
4 Ways to Pay a High Energy Bill
A surprisingly large energy bill could create chaos for your budget. Here are four options for paying a high energy bill.
1. Seek Financial Assistance
Before panicking about a high energy bill, contact your energy provider. Many providers offer financial assistance for customers struggling to pay their bills. For instance, Southern California Edison customers may qualify for:
- 12-month repayment plans for past-due balances
- An Energy Assistance Fund giving eligible ratepayers up to $300 once annually toward electricity bills
- Discounts through the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs
Your state may also offer assistance through the Low Income Home Energy Assistance Program, which helps low-income households pay their energy bills. Search for other state and federal financial assistance by visiting the 211 Network (or calling 211) or using the Benefit Finder tool on Benefits.gov.
2. Tap Your Emergency Fund
Don't qualify for financial assistance? Consider tapping your emergency fund; after all, it's meant to cover unexpected expenses. Just be sure to replenish your fund so you're ready for the next emergency.
Keeping your emergency fund in a high-yield savings account could help you grow your money faster. As of February 2024, some high-yield savings accounts boast annual percentage yields (APYs) of 5% or more. A standard savings account's average APY was just 0.47% in that same time period.
3. Cut Back Elsewhere
You might be able to squeeze enough to pay the energy bill from your monthly budget. Look for places to cut back: Can you reduce food costs by cooking at home instead of eating out, using coupons when shopping and building menus around what's on sale? Lower your transportation costs by carpooling, walking or biking when possible. Save on entertainment by hosting friends for a game night at home instead of meeting at a bar.
Also review recurring expenses such as gym memberships, streaming subscriptions or cellphone plans. Cutting these costs can save you money now—and every month going forward.
4. Pay With a Credit Card
You can generally pay a utility bill with a credit card, but it's not always the best option. If you're already struggling to pay the bill, you might not be able to pay off the credit card balance in full when your next bill comes due. In that case, any remaining balance begins accruing interest, ultimately making your energy bill even costlier. If you must use a credit card to pay your energy bill, have a plan to pay it off as soon as possible.
How to Reduce Your Energy Bill
Once you recover from the sticker shock of a high energy bill, take steps to keep it from happening again.
- Install a programmable thermostat. Starting at around $30, these devices let you program temperatures to adjust automatically at different times. Turning your thermostat seven to 10 degrees higher or lower than normal for eight hours a day (such as when you're at work) can cut energy costs by 10%, according to Energy.gov.
- Keep your home systems in top condition. Regularly service your air conditioning and heating systems so they run efficiently.
- Reduce electricity use during peak hours. Energy companies often charge more when demand for power is high (generally mornings and evenings) and less when demand drops (typically at night or mid-day).
- Shop around. In deregulated states, consumers have a choice of energy providers. Compare prices to see if switching providers could save you money.
- Think old school. Use natural methods such as trees, awnings, sunshades or light-blocking curtains to keep your home cool in summer. Open windows and use fans to draw cool air inside at night or early in the morning when temperatures drop.
- Keep tabs on your energy usage. Many utility companies let you set up alerts when your energy usage is projected to surpass your average, giving you fair warning to cut back.
Frequently Asked Questions
The average electric bill in the U.S. is $145.55, based on November 2023 data from the U.S. Energy Information Administration. Monthly electricity bills range from a low of $86.36 in Utah to a high of $224.18 in Hawaii.
For help with a high energy bill, contact your energy provider to see if they offer assistance or payment plans. Call 211 or visit Benefits.gov to find state and federal financial assistance. You can also contact your state's Low Income Home Energy Assistance Program (LIHEAP), which helps low-income households pay their energy bills.
Because utility companies don't report your payments to credit bureaus, an unpaid energy bill won't affect your credit immediately. However, if the energy provider sends your debt to collections, it appears on your credit report and stays there for seven years, which can lower your credit score.
The Bottom Line
Paying your energy bills can help improve your Experian FICO® Score☉ when you sign up for Experian Boost®ø. This free feature gives you credit for on-time payments to utility, phone and streaming service providers, and won't penalize you for late payments.