The bill is not one price
Look closely at any residential bill and you'll find two different pricing ideas stacked together:
- The usage rate — cents per kWh, multiplied by your metered consumption. This is the part conservation shrinks.
- The fixed charge (customer charge) — a flat dollar amount per month for being connected at all: metering, billing, the pole and wire that sit ready regardless of usage.
A typical fixed charge runs single-digit dollars per month, but proposals range far higher, and the direction of regulatory travel for the last decade has been upward in many states. Some utilities add a third layer — minimum bills — where the fixed charge acts as a floor under low-usage months.
Live from the EIA data on this site
The national average residential bill is $164.05/month (June 2026), and the priciest of our tracked 51 states is Hawaii at 52.72¢/kWh.
Why fixed charges exist (and why they grow)
The utility's costs genuinely split into two kinds. Fuel and generation scale with kWh; poles, wires, meters and customer service largely do not. A pure-usage rate under-recovers the second kind from low-usage households and over-recovers it from heavy users — which is why utilities argue fixed charges match "cost causation," and why conservation and solar advocates argue high fixed charges blunt the incentive to use less.
The regulatory fight matters to you in one concrete way: as fixed charges grow, the savings from cutting usage shrink. At a $5 fixed charge the effect is trivial; at $15–$25 it visibly changes the payback on efficiency investments.
The arithmetic solar and conservation math depends on
Work an example. Suppose your all-in rate is 16¢/kWh with a $12 fixed charge:
| Monthly usage | Usage cost | Fixed charge | Total | Fixed share |
|---|---|---|---|---|
| 300 kWh | $48.00 | $12 | $60.00 | 20% |
| 800 kWh | $128.00 | $12 | $140.00 | 9% |
| 1,500 kWh | $240.00 | $12 | $252.00 | 5% |
The fixed charge is 20% of a small bill and 5% of a large one — which is exactly why the two designs redistribute costs between light and heavy users, and why rooftop-solar savings calculations must subtract the fixed charge before projecting payback.
Find yours, then compare your rate
- On your bill, find the line usually labeled customer charge, basic service charge or meter charge — flat, per month.
- Divide the usage amount by kWh to recover your true marginal rate — the number that responds to conservation.
- Compare that rate against your state's average on its state bill page, and your bill against the utility rankings.
Frequently asked questions
What is the fixed charge on an electric bill?
A flat monthly amount for being connected — metering, billing and grid access — charged regardless of how much electricity you use. It sits on the bill alongside the per-kWh usage rate.
Do solar panels reduce the fixed charge?
No. The fixed charge applies to the connection, not consumption, so it survives full offset of your kWh. Solar payback math should use the usage rate only.
Why are utilities raising fixed charges?
Utilities argue grid costs are driven by connection, not just consumption, and fixed charges recover those costs more stably — especially as efficiency and rooftop solar shrink usage-based revenue.
How do I find my true per-kWh rate?
Take the usage dollar amount from the bill, subtract nothing for the fixed charge, and divide by kWh billed. Comparing that against your state average here shows whether your utility prices high or low.
Sources & further reading
WattRate publishes EIA data and general explainers — not financial advice. Your own bill reflects your utility's tariffs and your usage.