I finally turned my furnace on for the winter this weekend. As I thought about all the money I’ve saved keeping it off for several extra weeks, I was reminded of a discussion I had with a friend earlier this year. He was comparing his electricity bill to the previous year to see how much his new air conditioning unit was saving. Of course, there are a lot of ways to arrive at the wrong answer.
Let’s look at some of the things that affect the dollar amount of a utility bill:
- The price per unit. Natural gas, propane, and electricity all have costs that vary based on a variety of factors: fuel cost, regulatory requirements, taxes, etc.
- Weather. Obviously extreme weather will affect how much is consumed, which then affects the final bill.
- Billing period. At least for my bills, the length of the billing period can vary by one or two days. This is probably due to working days (particularly holidays), and the fact that months are not of equal length.
- Usage patterns. If you’re out of town for a week in October of this year, but not of last year, your overall usage will probably be down this year. Similarly, if you add, remove, or replace appliances that can have an effect separate from your HVAC system. Or if you switch from working at an office to working from home, you’ll probably see an increase in utility usage.
So how can you see if your new furnace, air conditioner, fancy thermostat, or whatever has made a difference? It’s going to be hard to account for some of the factors above (particularly usage patterns), but the best way is to look at your usage per degree day.
What’s a degree day? It’s a measure of the amount of heating or cooling required. The simplest measure of a heating degree day is to subtract the daily average temperature from 65. For example, if the average temperature for a given day is 55, then you would record 10 heating degree days. Similarly, to calculate cooling degree days, you would subtract 65 from the average temperature. So on a day with a 75 degree average temperature, you would record 10 cooling degree days. The lowest measure of degree days is 0; you would not record negative values. (Note that “average” here means the mathematical average of the high and low, not the climatological normal. If you have more detailed temperature data, you can calculate on an hourly or similar basis to get a more accurate value.)
Utility companies will sometimes include the heating or cooling degree days for the billing period in your bill. If not, you can get values online. Divide your usage for the month (e.g. the kiloWatt hours) by the heating or cooling degree days to get a value you can compare to other bills. If your usage patterns are relatively the same, you’ll now be able to compare year-to-year.