Why a Bill Rises: The Causes That Are Not the New Equipment

Why this matters

Install new equipment and the next bill that goes up is yours. The customer does not care that the billing period ran a week longer, that the utility added a rider, or that the coldest week of the winter landed in it. They see a new heat pump, a new water heater or a new pool pump, and a bigger number, and they connect the two. If the tech on the callback cannot take the bill apart in front of them, the shop ends up replacing parts on a system that was working, or refunding a job that was done right. Most bill increases have nothing to do with the equipment, and the bill itself usually says so.

Three questions before anyone looks at equipment

Every rise in a bill comes from one or more of three places. Ask them in this order, because the first two need nothing but the bill.

1. Did the price per unit change? Same use, higher rate, bigger bill.
2. Did the measurement change? More days in the period, or a read that was estimated last time and actual this time.
3. Did use per day change? Only this one involves the house, and even here the equipment is one cause among several.

The sequence for working a high-bill call from first contact to finding belongs to its own card. See related: How to Diagnose a High-Bill Call in Order. This card is the list of causes that sequence is choosing between.

Causes that change the price, not the use

• A rate change. Utilities change rates through their state regulator (or, for a municipal utility or co-op, its governing board), and the new rate applies from a stated date, sometimes partway through a billing period. The bill shows the rate per kWh or per therm; compare it line by line with last month's.
• A rider change. A rider is a separately listed charge or credit the regulator approves on top of base rates: fuel or purchased-gas adjustments, storm or infrastructure recovery, efficiency program charges. They move monthly or quarterly. A fuel adjustment can move a bill noticeably with no change in use.
• A tier crossing. On a tiered plan, the first block of use is priced at one rate and use above it at a higher one. A month that pushes past the block boundary costs more per unit at the margin. See related: Tiered and Seasonal Rates: Why the Last Kilowatt-Hour Costs More.
• A seasonal rate. Some plans price summer or winter use higher. The first bill of the season looks like a jump even at the same use.
• A supplier rate change. In states with retail choice, an introductory fixed rate from a third-party supplier can roll to a variable rate. See related: Third-Party Energy Suppliers and the Variable-Rate Jump.
• A budget-billing settlement. A customer on level payments sees the bill jump at the review month for use that happened months earlier. See related: Budget Billing and the True-Up Month Surprise.

Causes that change the measurement

• More billing days. Billing periods are commonly anywhere from the high 20s to the mid 30s in days, depending on read schedules, weekends and holidays. A 35-day bill after a 28-day bill is 25 percent longer before anything else happens. See related: How to Compare Two Bills With Different Billing Days.
• An estimated read catching up. If last month's read was estimated low, this month's actual read collects the difference, and the bill covers more use than the period suggests. The bill marks estimated reads, usually with a letter or a note beside the read. See related: Estimated Versus Actual Meter Reads and the Catch-Up Bill.

Causes that change use, without anything being broken

• Weather. The largest single driver of heating and cooling use. A colder month or a hotter one moves use per day even with identical equipment and identical habits. See related: How to Weather-Normalize Two Winters of Bills.
• A new load. Something added to the house or the meter: a freezer, a hot tub, an EV, a shop heater, a dehumidifier. The customer may not count it as a change. See related: The Loads a Customer Forgets They Own.
• A household change. Someone moved in, someone started working from home, a newborn, a visiting relative for the holidays, a teenager's longer showers. People at home during the day run heat, lights and appliances during hours the house used to sit idle.
• A changed setting. A new thermostat schedule, a setback that triggers backup heat on recovery, a water heater turned up, a pool pump timer reset after a power outage. Nothing failed; something is set differently.

Causes that are a fault

• Backup heat running when it should not. Heat strips held on by a stuck relay, a thermostat left in emergency heat, or auxiliary settings that call strips too early. Shows as large draws on cold mornings or all day. See related: The Bill That Doubled From Emergency Heat.
• A running toilet or a hidden leak. On a water bill, a flapper that does not seal can run continuously without anyone hearing it. See related: The Water Bill From a Toilet Nobody Heard Running.
• A short-cycling well pump. A pressure tank that has lost its air charge, or a leak downstream, makes the pump start every few minutes. See related: The Well Pump That Ran Up the Electric Bill.
• Other equipment working against itself. A refrigerator that cannot defrost and runs without stopping, a water heater element whose thermostat sticks closed, a dehumidifier in a space with an unsolved water problem.

Note that a fault in the new equipment belongs in this list too. It is a real possibility, which is exactly why it gets checked after the bill is read and not before.

Worked example: the first bill after a heat pump install

A heat pump replaced an aging one in early January. The customer calls about the February bill.

The two bills, read straight off the page:

• Prior bill: 28 days, 840 kWh, actual read, average temperature for the period 44 F.
• Current bill: 35 days, 1,190 kWh, actual read, average temperature 37 F.

The customer's comparison: 840 to 1,190 kWh, a 1,190 / 840 = 1.417, or 41.7 percent, rise, and the dollar figure up more than that. Take it apart.

Billing days. 35 / 28 = 1.25. The period is 25 percent longer before anything in the house changes.

Use per day. 840 / 28 = 30.0 kWh a day before; 1,190 / 35 = 34.0 kWh a day now. 34.0 / 30.0 = 1.133, a 13.3 percent rise per day.

Check that the two pieces rebuild the whole. 1.25 x 1.133 = 1.417. The 41.7 percent rise is 25 percent more days times 13.3 percent more use per day, and nothing is left over.

Weather against the per-day rise. The current period averaged 7 F colder. In an all-electric house where heating is a large share of winter use, a colder period raises use per day. Whether 13.3 percent is the right size for 7 F colder is a weather-normalization question with its own method; at this stage it is enough that the direction and rough size fit, and that nothing points the other way.

Why the charge rose faster than the kWh. This plan prices the first 1,000 kWh on each bill at one rate and everything above at a higher rate. (Many utilities prorate that block by billing days instead; read the tariff before using this step.) The prior bill never reached the block boundary. The current bill put 1,190 - 1,000 = 190 kWh above it. The bill also shows the fuel adjustment rider moved up between the two periods. Both raise the charge with no change in use.

What the customer hears. "This bill covers 35 days and the last one covered 28, which by itself makes it 25 percent bigger. On top of that is about 13 percent more use per day, in a month that averaged 7 degrees colder. And the charge grew faster than the use because 190 kWh landed in the higher-priced block and the fuel adjustment went up. None of that needs the heat pump to be doing anything wrong. Here is what would tell us if it were." See related: How to Write a High-Bill Findings Note for the Customer.

What would point back at the equipment. Per-day use rising well beyond what the weather supports after normalization, large draws on mornings when the house should be coasting, or auxiliary heat hours on the thermostat on mild days. If interval data shows 7 kW steps every morning at the setback end time, the next look is the thermostat's auxiliary settings and the strips. See related: Smart Meter Interval Data: What the Hourly Record Shows.

What would have flipped it. If the prior bill had been 35 days too and use per day still rose 13 percent in the same weather, there is no calendar or weather explanation left, and the new equipment moves up the list. If the prior read had been marked estimated, the 840 kWh could be understated and the comparison is meaningless until two actual reads bracket the period.

What the order protects you from

Reading price and measurement first is not a stalling tactic. It is the cheapest test, it rules out causes the customer cannot see, and it tells you how much of the rise is actually left for the house to explain. In the example only the per-day rise, 13.3 percent, ever needed a physical cause. Had the tech gone straight to the heat pump, they would have been trying to explain 41.7 percent with equipment that accounted for, at most, a slice of 13.3.

For the step-by-step isolation once you know the cause is inside the house, see related: Utility Bill Spike - Source Isolation Decision Tree.

References

• See related: Anatomy of a Residential Electric Bill, Line by Line
• See related: Utility Bill Spike - Source Isolation Decision Tree
• See related: Helping Customer Read Utility Bills Reference
• See related: What a Utility Bill Can Tell You That an Inspection Can't
• The customer's utility tariff on file with the state public utility commission, for tier boundaries, proration and riders