Should I Use Utility Budget Billing? Neale Talks About The Down Sides

“Budget billing” is a service offered to customers by major utility companies.  Under this plan, your annual costs for gas and electricity are divided up into twelve equal payments.   This offers a relatively uniform payment amount for every month.    This means that winter costs seem lower while costs in the rest of the year are higher but uniform.

There is problem with this uniformity and convenient even payments.  Budget billing often leads to not looking at your heating and cooling costs and may discourage taking action to lower your usage and hence bill.

I recommend looking at your bills in winter, summer, and optionally in spring/fall times.   Most important is not to look at the dollar figures but to concentrate on the “therms” of gas usage and “kilowatt hours” of electric usage.  This allows you to look at your usage, without the ever changing, confusing, and often increasing cost of energy.

If you look at gas usage in winter, collect data for December, January, and February (therms).   If the sizes of these numbers surprise you, next look at the gas usage in summer months.   Average these numbers or just eyeball the approximate average to determine your “baseload” usage that is usually the hot water heater, stove, and/or dryer.   Finally, you subtract your “baseload” number from the therm usage in the three winter months.   This result is your “heating costs” for these three months.

How much are you heating your home?

If your therm numbers really “spike” in January compared to December, then your house’s performance may be affected by lower temperatures.   Generally, in most homes January’s usage is higher than December and February’s usage will be somewhat lower than December.   The bottom line is how much you are heating your home and how much you are heating the neighborhood.

Electric usage of Kilowatt-Hours over the months are often quite uniform except for some increase at Christmas time and any months where you close up your home and run the air conditioning system.   Beyond “Budget Billing,” the usage of A/C may surprise you.

Air conditioning is often oversold in Wisconsin

I will confess that I believe air conditioning is often oversold in Wisconsin.   There are usually 8-12 beastly hot days with drenching humidity in our climate that may call for active air conditioning, but most of the warm season has cooler nights that are usually at or below the setting for central air conditioning.    I walk a dog every night and am surprised to feel the coolness of the night in contrast to the droning on and on of central air conditioning.

For the planet, the environment, and comfort, most every home can be air sealed and insulated to perform better.   As improvements are realized, customers of “budget billing” should inform their utility company.   The company will then recalculate your energy budget and adjust your monthly billing amount to reflect the improvements that have been made.   It may take a while and might require a second follow up calculation and re-adjustment.

Still you as a customer stand to gain a lower monthly payment and a feeling of accomplishment.

One way to find out how your house is performing is the Wisconsin (and Illinois) Home Performance with Energy Star Programs.   Wisconsin offers a comprehensive testing and analysis of your home before and after improvements are made.  There is a customer cost for this step of the process.   The “carrot” is an instant 33.3% discount on the costs of improvements up to a ceiling of $1,250.   That means you gain a $900 to $1,000 net subsidy to make improvements.

“Saving the Planet One House at a Time”

Contact Neale Thompson with any questions or comments about utility budget billing by calling 608-449-4376, emailing [email protected] or by visiting our contact page.