I’ve just completed my first full year of being on my electric company’s budget billing plan.
Here’s how it works. When you sign up, the utility takes the total amount you paid them for the year and divides it by 12. They then use this number as an estimate for your monthly bill. The perk to this program is that your power bill is exactly the same every month, no matter how much electricity you’ve used.
Every August, looks at what the actual readings versus what you have been paying each month. Depending on your useage, the utility may owe you a refund or you may owe the utility a sum of money.
This August we ended up with a bill of $362 after a whole year of paying $180 a month.
I have two good explanations for why we ended up short with the electric company. The first explanation has to do with how they estimate your usage. My electric company based its figures on 2006 numbers… before we added 2 more babies to our hosuehold. We are using a lot more electricity: doing laundry, running the dishwasher, up at night (rarely) and because I’m now a stay-at-home mom, I’m also using more power during the day than we used to.
The second explanation is that utility rates have gone up, and their estimates did not account for the increase.
I’m not really all that upset by having a large bill due. We’ve put away money in our savings expecting this bill. Essentially the power company gave me an interest-free loan all these months. I’ve actually made money by choosing budget billing because I’m earning interest on my money as it sits there.
Overall, I’ve been pleased with the peace of mind that budget billing brings. I know exactly what my power bill will be each month. It’s much more convenient.
Have you used budget billing? What do you think of it?