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Blog Feb 23, 2012

Power Company Rates: What’s a Kilowatt-hour

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Do you understand the terms watt and kilowatt? Do you have trouble figuring out how your electric company calculates the amount of energy you consume on a monthly basis? Payless Power, a retail electric company providing cheap electricity in Dallas with low power company rates, can help you understand and make sense of all the terminology associated with electricity.

Electric power is measured in the basic unit of a watt. A watt is the rate of electricity use at any particular instant. A kilowatt is equal to 1000 watts, so the amount of electricity you use in an hour is a kilowatt-hour. The number of kilowatt-hours (kWhs) you use is calculated on a monthly basis. Simply put, watt-hours are a measure of how much electricity is used over a period of time. The watt-hours used are divided by 1000 to get the actual kilowatt-hours used.

Are you still a bit confused? Perhaps understanding the cost of running some common household devices will make this easier to understand. Consider the following examples:

  1. A 100-watt light bulb used for 500 hours during the month would mean it used 50 kWh.
  2. A large window air-conditioning unit using 1500 watts for ten hours during the month would equal 15 kWhs used.
  3. A small window air-conditioning unit using 500 watts of electricity for ten hours during the month would equal 5 kWhs used.

The formula you should have picked up on is:

Wattage  x  hours used  divided by 1000  x price per kWh  =  the cost of electricity used

Electric companies’ rates vary by location, but the rate is always measured in kWhs used.  For instance, the average price of residential electricity in the United States in August 2011 was $0.12/kWh, ranging from only $0.082 in Washington State to $0.29 in Hawaii!  Hopefully Payless Power, your low rate retail electric power company, has made some sense of what’s watt and kilowatt!

For more information on how to find cheap electricity in Dallas, visit

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Me preocupaba conseguir electricidad para mi casa a través de una compañía de prepago. Estuve llamando a varias compañías para consultar las diferentes tarifas y luego tuve que pasar por la moles…

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