Electricity Cost Calculator 2025

How to Calculate Electricity Costs

Calculating electricity costs involves determining the energy consumption of an appliance or device and multiplying it by the electricity rate. This process helps estimate the financial impact of using various electrical devices in your home or business.

Electricity Cost Calculation Formula

The formula for calculating electricity costs is:

Cost = (Wattage × Hours Used Per Day × Days Used Per Year × Electricity Rate) ÷ 1000

Where:

• Wattage is the power consumption of the appliance in watts
• Hours Used Per Day is the average daily usage time
• Days Used Per Year is how often the appliance is used annually
• Electricity Rate is the cost per kilowatt-hour (kWh)
• 1000 is used to convert watts to kilowatts

Calculation Steps

1. Determine the wattage of the appliance
2. Estimate the average daily usage in hours
3. Multiply the wattage by the hours used per day
4. Divide the result by 1000 to convert to kilowatt-hours (kWh)
5. Multiply by the number of days used per year
6. Multiply by the electricity rate per kWh

Example Calculation

Let's calculate the annual cost of using a 100-watt light bulb for 5 hours a day, every day, with an electricity rate of $0.12 per kWh:

1. Wattage: 100 watts
2. Hours used per day: 5 hours
3. Days used per year: 365 days
4. Electricity rate: $0.12 per kWh

Plugging these values into our formula:

Cost = (100 W × 5 h × 365 days × $0.12/kWh) ÷ 1000 = $21.90 per year

Electricity Cost Visualization

This diagram visually represents the daily, monthly, and annual costs of using a 100-watt light bulb for 5 hours a day, based on our example calculation.