🧾Electricity Tariffs Explained

By the What It Costs editorial desk

Every calculation on this site needs one number from your bill, and bills are designed to make it hard to find. Here is what each part means and which one to use.

Unit rate — the number you want

The unit rate is what you pay per kilowatt-hour consumed. It is the only figure that belongs in a running-cost calculation, because it is the only part that changes with how much you use.

On the bill it may be called the unit rate, the energy charge, the supply charge, or simply cents/pence per kWh. It is usually printed next to the meter readings rather than in the summary.

Standing charge — the number you do not want

A standing charge or service fee is a fixed daily or monthly amount for being connected. It is the same whether you use nothing or everything, so it is not part of what an appliance costs. Some countries have high standing charges and low unit rates, others the reverse — which is why comparing suppliers on unit rate alone is a mistake even though calculating an appliance on unit rate alone is correct.

Time-of-use and economy tariffs

On a time-of-use tariff the unit rate changes by hour: expensive at the evening peak, cheap overnight. Variants include Economy 7 and Economy 10 in the UK, and off-peak or super-off-peak periods in the US and Australia.

This changes every calculation on this site. The same dishwasher can cost three times more at 6 pm than at 1 am. When entering a price here, use the rate that applies while the appliance actually runs — and if you are on such a tariff, moving a dryer or a dishwasher to the cheap window is usually the single biggest saving available to you.

EV tariffs

A dedicated EV tariff offers a very low overnight rate — often a third or a quarter of the standard one — in exchange for charging in a defined window. They apply to the whole house during that window, not just the car, which is why dishwashers and dryers get moved onto timers in homes that have one.

Fixed, variable and capped

• Fixed locks the unit rate for a term. Predictable; may be above or below the market later.
• Variable follows the market or a regulator’s cap and can change with notice.
• Capped or default tariffs are the fallback if you never chose one, and are usually the most expensive place to sit.

None of this changes what an appliance uses. It changes what a kilowatt-hour costs, which is the second half of every equation here.

Taxes, levies and VAT

Bills include taxes and network levies, sometimes inside the unit rate and sometimes as separate lines. If the unit rate on your bill is quoted excluding tax, add it before using it here — otherwise every figure comes out low by whatever the rate is. The quickest sanity check: divide a recent bill’s total energy charge by the kilowatt-hours it covers, and use that.

Once you have the number, the electricity cost calculator does the rest — and every tool on this site keeps that field editable for exactly this reason.