Just What the Fuck Am I Paying For??? An In-Depth Look at our Monthly Utility Bills...

So in the last few weeks, I have attempted to take a closer look at our monthly household expenditures and see where our money was going in hopes of discovering where we can cut back.

A few posts ago, I did a comparison of our monthly costs from 1997 and how much more we are paying now. I did find our monthly bills took a hike on average almost 300% to what we were paying in 1997; in fact, our mortgage payments we had back then are now fully absorbed into our monthly bills now- meaning the cost of our utilities and other monthly necessities excluding food and gas has increased so much since 1997, that we are paying more per month now being mortgage free than we were in 1997 with a 5.25 % mortgage!

Remember when every summer your heating bill was like $10? I never see those kind of bills anymore..do they even go down anymore?.... what happened? Are we using that much in utilities now? In this post, I want to take a closer look at our utility bills per se and see if our consumption is that much higher than it was in 1997. We have 3 children now and my wife stays at home; so it is expected we should be consuming more heat, electricity, and water than we did when it was just the two of us in the same home and both of us had full time day jobs.

But, we have also taken other measures to save on consumption costs over the years: we switched all our incandescent lightbulbs to compact fluorescent ones (they're supposed to last longer and pay for themselves in energy savings though more expensive to buy); we changed out our top load washer and dryer to front load Energy Star washer and dryer with bigger capacities; we replaced our old aluminum frame windows to triple pane gas-filled PVC frames throughout our home; we added a higher R-value styrofoam insulation and vinyl siding on top of our once wood sided exterior of our home; added central air conditioning and got rid of the dozens of little electric fans; installed a digital programmable thermostat; changed out the dip tube in our hot water tank; changed our toilets to the dual flush, low water consumption variety; we changed out our dishwasher and range to more energy efficient Energy Star rated appliances; our television sets and computer screens are all LCD or plasma which is supposed to be much more energy efficient compared to the old CRT or tube displays.

I again reiterate the reason why I use the year 1997 as my benchmark for my comparison is because, it was in 1997, we bought our home and based our standard of living to affording all those monthly payments as if I was unemployed collecting UI or the wife affording all monthly payments by herself with her retail job. And, since we were able to do that back then, the test is to see if we are able to live that way now in 2011.

First, heating...

As you can see above in Nov.24 to Dec 23 (29 day period), we used 17.98 GJ of natural gas at a cost of 3.09789/GJ. Energy cost totalling $55.70 and total bill with added fees and GST is $83.26. Average temperatures in December 1997 ranged from −12C to +14C; most of the month sat in the +5C area and with the exception of the first week, temperatures were above freezing.

In the same time period of 29days (Nov24-Dec22) in 2010, we used 18.79GJ of natural gas at an average cost of $3.74773/GJ; energy cost totalling $70.26.

As you can see our consumption of heat is only 0.81GJ more (same home and same furnace) and the cost of natural gas is only $0.6498 difference between now and in 1997. A difference in energy costs of only $14.56, but if we had the same energy rates as in 1997 as now, or the same consumption levels, you will see the difference in consumption and actual costs is pretty much nil; it is closely the same now as it was in 1997. BUT... total bill in Dec 2010 is $158.45!!! Almost double the amount we have to pay per month due to fixed fees, administration fees, transmission fees, and service charges!!

In December 2010, it was a much colder month than it was in 1997; temperatures ranged from −20C to −2C and remained below −10C for most of the month!

Since gas consumption levels were pretty much the same in Dec 1997 compared to Dec 2010, but 2010 was on average about 15C to 20C COLDER than it was in 1997, this tells me all of our attempts to save on energy costs such as new windows and insulation must be working! Yay!

How about electricity?

In 1997 for the month of November (Dec 3rd meter reading), we used 622kWh of electricity at a cost of $0.0668 per kilowatt per hour; total energy cost of $41.55; bill totalling $53.36 with GST.

In the same month in 2010 (Dec. 1st meter reading), we used 973kWh at an energy cost of $0.070 per kWh; the total energy cost of $68.11.

As you can see, electricity rates are very close but consumption is up 50% in November 2010. But, comparably if consumption was the same in 2010 as it was in 1997, the cost of actual energy per se would be pretty much the same. But, the total bill including those new transmission fees, administration fees, etc is $119.03 with GST! More than double in 2010 than in 1997 subtracting the higher consumption from the equation!! Additional consumption would only add an extra $24.57 to our bill; the rest of the increases come from the gouging by Enmax with their ridiculous transmission fees and administration and distribution charges!!

Water, drainage and waste management...

In November 1997 (meter reading on Dec 3rd), we used 7.0 cubic metres of water at a cost of 164.57 cents per cubic metre; total energy cost was $11.52. Drainages cost $10.15 based on our consumption. Waste Management or garbage disposal cost a fee of $5.00 in 1997.

In the same month in 2010 (meter reading on Dec 1st), we used 10.0 cubic metres of water at a cost of 158.7 cents per cubic metre; total energy cost of $21.60. Drainage cost $23.85 and waste management cost $29.85. Total bill for November 2010 including all fees was $75.39!!

We can see actual water rates have actually dropped since 1997 but our consumption was up 50% also; 3 more cubic metres of water used in 2010 than 1997 equalling 659.91 gallons more water usage! But if we had the same consumption level now as in 1997, we can see we would only save $10 in water and $10 in drainage totalling only $20 off our current bill; so the increased consumption really doesn't add up to very much considering again there are more people in our household now and the upgrade to a front load washer possibly helps keep our water usage down. But, our 2010 water bill minus the $20 in consumption savings would still be more than double what we paid in 1997...

Hence, in this look at 1997 versus 2010 consumption of utilities, we can see actual usage has went up for water and power by 50% for each; adding 3 children ages 10, 7, and 4 attributed a large part in that increase in consumption; and the fact one adult stays at home more hours of the day than she did in 1997. Adding energy conservation items such as fluorescent lighting and Energy Star appliances may or may not have reduced our water and power usage and it remains to be proven in another study perhaps in the near future just really how much those energy efficient upgrades are saving us each month if they are actually at all. Yes, granted, we probably can do a much better job in our energy conservation by turning off more lights and trying to use less water but, in reality the 50% hike in consumption only adds $20 to our bill for water and $26 for power.

Natural gas rates and consumption, is mostly the same since 1997; there was a spike in natural gas prices circa 2003-2005 where we all saw huge increases in our gas bills in Alberta; but those floating commodity prices has fallen since the recession and currently sit close to 1997 levels now; and for some reason our bills have not dropped relative to falling commodity prices. We also see in our example above that December 2010 was much colder than December of 1997; and our natural gas usage remained constant hence our efforts to save money back when natural gas prices spiked to record highs to $11- $13/GJ by installing new windows and insulation and other energy saving tactics was not in vain.

But, as with all the utilities, it was also shown most of the increases came in the form of new or extra service or administration fees that were non-existent in 1997.

It seems that energy deregulation in Alberta really hasn't affected actual energy user rates by making them cheaper with more competition among providers or more expensive for that matter; but what it has done is let these service providers rake us through the coals by letting them charge whatever they want for fees and charges that have nothing to do with the generation, transmission and distribution of the product.

Perhaps the people in Alberta should look at their bills a little closer and ask the government why our utilities has increased so much in 13 years... As most of us including myself, have been guilty of just getting our monthly bills and obliviously paying them off each and every month without inquiry. The utility companies have blamed rising commodity prices in gas and electricity and today's greater consumption needs with the advent of high speed internet, greater use of electronic goods, etc.; and we ignorantly believe them. While in this analysis, I have found our greater consumption of utilities has increased with the increase in people in the household and more electronic goods in use BUT because of the addition of more energy efficient appliances, the increase in energy usage is actually quite nominal compared to the providers' added surcharges and administration fees. C'mon! A "Municipal Franchise Fee"?? And what the heck is a "Balancing Pool Allocation" fee or these "rider" fees??

That's like if I opened a coffee shop to sell coffee..but you will be charged a service charge for using clean towels to wipe up spilt coffee.. WTF?? And yeah, the Government permits it to happen! It is little wonder why Egypt and Libya are up in arms these days...perhaps we need a revolt or a "Day of Rage" of our own...

1 comment:

Sandy @yesiamcheap said...

This is why so many people are in trouble. They budgeted for a certain amount of household expenses but the cost of living has risen at a far, far rate than paychecks.