A utility bill is a monthly charge for essential household services — electricity, gas, water, and trash collection. The average US household spends $180–$220 per month on combined utilities in 2026. Here’s what each utility covers, how the bills are calculated, and how to lower your costs.
What Is Included in a Utility Bill?
| Utility | What You Pay For | How It’s Measured | Average Monthly Cost |
|---|---|---|---|
| Electricity | Power for lights, appliances, HVAC, devices | Kilowatt-hours (kWh) | $130–$155 |
| Natural gas | Heating, water heater, stove | Therms or CCF | $30–$80 |
| Water and sewer | Indoor water use, wastewater treatment | Gallons or CCF | $30–$70 |
| Trash and recycling | Waste pickup (weekly or biweekly) | Per bin or flat fee | $20–$40 |
| Combined average | — | — | $180–$220/month |
Source: EIA Residential Energy Consumption Survey; EPA WaterSense
How Utility Bills Are Calculated
Every utility bill has two components:
1. Fixed service charge: A flat monthly fee for maintaining the service connection — typically $5–$20/month per utility, regardless of how much you use.
2. Variable usage charge: The amount you actually consume, multiplied by the rate:
- Electricity: Average US residential rate is about $0.14–$0.16 per kWh nationally. A household using 900 kWh/month pays $126–$144 in usage charges plus the fixed fee.
- Natural gas: Average rate is about $1.10–$1.40 per therm. A winter month using 80 therms for heating costs $88–$112.
- Water: Average rate is about $3.50–$6.00 per 1,000 gallons. The EPA estimates the average household uses 80–100 gallons per person per day.
Average Utility Bills by State
Utility costs vary dramatically by location due to climate, energy sources, and local rates:
| State | Avg. Monthly Electric Bill | Notes |
|---|---|---|
| Hawaii | $175–$220 | Highest in US — island grid, imported fuel |
| Alabama | $140–$170 | High AC demand, relatively low rates |
| California | $130–$160 | High rate per kWh, mild climate |
| Texas | $135–$165 | Extreme heat, AC-heavy summer use |
| Utah | $85–$110 | Low rates, moderate climate |
| Maine | $90–$120 | Low summer demand, high heating oil costs |
The EIA publishes state-by-state electricity and gas cost data at eia.gov.
Understanding Your Electric Bill
A typical electricity bill breaks down as:
| Line Item | Example Amount |
|---|---|
| Fixed service/customer charge | $10.00 |
| Energy charge (900 kWh × $0.14) | $126.00 |
| Distribution charge | $15.00 |
| State/local taxes and fees | $8.50 |
| Total | $159.50 |
The “energy charge” is the part you control through usage. The fixed charges remain constant regardless of conservation.
What Counts as a Utility for Budgeting?
Traditional utilities (electricity, gas, water, trash) are distinct from communication services like internet and phone. However, many budgeters group both under “utilities” since they’re recurring monthly necessities:
| Category | Service | Traditional Utility? |
|---|---|---|
| Energy | Electricity, natural gas | ✅ Yes |
| Water | Water, sewer | ✅ Yes |
| Waste | Trash, recycling | ✅ Yes |
| Communication | Internet, phone | Often included in utility budget |
| Entertainment | Cable, streaming | ❌ No |
How to Reduce Your Utility Bills
Electricity:
- Set your thermostat 7–10°F lower when sleeping or away (saves up to 10% annually)
- Switch to LED bulbs (use 75% less energy than incandescent)
- Unplug devices not in use — “phantom load” can add $50–$100/year
Water:
- Fix leaks promptly — a dripping faucet wastes 3,000+ gallons/year
- Install low-flow showerheads (EPA WaterSense certified) and aerators
- Run dishwasher and laundry only with full loads
Natural gas/heating:
- Seal windows and doors with weatherstripping
- Lower water heater temperature to 120°F (from common default of 140°F)
- Service your furnace or heat pump annually
What Happens When You Can’t Pay Your Utility Bill?
If you’re struggling to pay utilities:
- Call your provider — most utilities offer payment plans and hardship programs
- Apply for LIHEAP — the Low Income Home Energy Assistance Program is a federally funded program that helps low-income households pay energy bills
- Contact local nonprofits — many communities have emergency utility assistance funds
Most states have winter disconnection moratoriums preventing shutoffs during extreme cold. Check your state’s Public Utility Commission for specific protections.
See our average utility bills by state guide for detailed state-by-state comparisons and our how to cut monthly expenses guide for more savings strategies.
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