How to Electricity Bill is Calculated: A step-by-step guide by Bharat Smart Services
Curious about your high electricity bills? Learn how electricity bills are calculated, understand tariffs, and discover tips to reduce energy costs.
When we see our electricity bill high, we all think about rechecking whether it’s the correct calculation or we all want to know the reason why we are getting the high electricity bills? Electricity is the basic thing needed in our daily lives. We find it difficult to find out how electricity bills are calculated or how to reduce electricity bills. Don't worry, In order to help you reduce your electricity bills and electricity consumption, we will explain in detail how electricity bills are calculated in this blog.
How Electricity bill is calculated?
Step-1: Meter reading
The first step you need to do is to note down the meter reading from the electricity meter reader to find out your electricity bill. Most of the electricity meters show the amount of electricity used in kWh (kilowatt-hours). You need readings from the previous and current months.
Step 2: Calculating Electricity Consumption
To get your total consumption, simply subtract the previous month’s meter reading from the present month’s reading. The result is your electricity consumption for the billing period, expressed in kWh. For example:
- Previous Reading: 1200 kWh
- Current Reading: 1400 kWh
- Electricity Consumption: 1400 – 1200 = 200 kWh
Step-3 Understanding Tariffs
The cost of electricity varies by service provider, location, and connection type (commercial, industrial, or domestic). Knowing the tariff that applies to you is very important. Tariff rates are usually accessible via customer service or the website of your power distribution provider. A slab system is also followed, in which higher usage is charged at a higher rate and lower consumption at a lower rate. For example:
- 0–100 units: ₹5 per unit
- 101–200 units: ₹7 per unit
- Above 200 units: ₹10 per unit
Note: The tariffs for different states may differ as per the units being consumed in different slabs.
Step 4: Calculating Energy Costs
Once you know your consumption and tariff rates, you can calculate your electricity cost using the formula:
Electricity Cost = Electricity Consumption (kWh) × Tariff Rate per UnitFor example:
- Consumption: 200 kWh
- Tariff Rate: ₹6 per kWh
- Total Cost: 200 × 6 = ₹1200
Step 5: Include Additional Charges
Your electricity bill often includes more than just energy costs. Here are some common additional charges:
- Service Charges: Fixed monthly fees based on your connection type.
- Meter Rent: A nominal charge for the electricity meter.
- Taxes: Includes GST and other state-specific levies.
When combined, these charges give you the total bill amount.
Equip yourself with knowledge
After reading the above information you get to know how electricity bills are calculated. This knowledge will help you efficiently reduce the use of energy and cut expenses. Bharat Smart Services gives you the tools to reduce expenses, maximize usage, and help create a more sustainable future.
Conclusion:
Electricity is one of the basic and quite essential resources for any country, especially India. Hence, it is very important to try and save as much as we can. The very first step towards saving electricity is knowing how much power consumption is happening in your home/building. In the next step, how to save it.
Our Bharat Smart Services AI- powered smart devices are the only solution. Using our devices smart plug and bijli auditor you can easily monitor, control, track usage and control electricity bills. Using our AI-Powered meter reading services you can easily capture your meter readings and get insights based on your consumption. If you also want to reduce your electricity bill, we are here to help you. Download bharat smart services app now and take a forward towards sustainable living.