How we calculate

Every number on WattSums comes from public U.S. government data and the formulas on this page. Each calculator page also shows its own formula, assumptions and a worked example for your inputs.

Where our numbers come from

We refresh the data every month and show the data month under every result, for example "Data: EIA, July 2026". The EIA publishes state electricity prices about two months after the month they cover, so the latest month we show is usually two months back.

Electricity rates

• The state rate is the EIA's average residential price: total residential revenue divided by kilowatt-hours sold, in cents per kWh. It includes delivery charges and fixed fees spread across all usage, so it's close to what most households pay per kWh on average.
• Your own rate can be higher or lower because of tiered pricing, time-of-use plans, or a large fixed monthly charge. To find it, divide the total on your bill by the kWh used, and type it into the "your rate" field. EIA averages leave out taxes, so a rate worked out from your bill may run a few percent higher.

The core formula

• Energy (kWh) = power (watts) × hours ÷ 1,000.
• Cost = energy (kWh) × rate ($ per kWh).
• Worked example: a 1,500 W space heater running 8 hours uses 1,500 × 8 ÷ 1,000 = 12 kWh. At the U.S. average of 18.31¢ per kWh that's 12 × $0.1831 = $2.20 a day.
• A month is the days per month you enter (30 by default), and a year is 12 such months. For an appliance that runs every day of the year, enter 30.4 days.

We keep full precision through the calculation and round only the results you see, to the cent for costs.

Air conditioning

• SEER2, EER2 and CEER ratings are BTU of cooling per watt-hour, so the power an AC draws while running is its BTU size ÷ its rating. A 36,000 BTU (3 ton) unit at SEER2 14.3 draws about 2,500 W.
• Hours are compressor running time. SEER2 is a seasonal average; on the hottest days a unit uses more.

Heating: space heaters, furnaces and heat pumps

• 1 kWh of electricity is 3,412 BTU of heat. Natural gas carries about 1,036 BTU per cubic foot (EIA), so 1 Mcf is about 1,036,000 BTU or 10.36 therms.
• A gas furnace delivers its AFUE share of the gas's heat (95% for a modern condensing furnace). A heat pump delivers its COP times the electricity it uses; 2.5 is a fair seasonal average.
• To compare one room with the whole house, we assume the house needs the same heat per square foot as the heated room. Gas prices are annual averages, because monthly residential gas prices swing with fixed charges spread over little summer use.

Electric vehicles

• Efficiency is the EPA combined kWh per 100 miles from fueleconomy.gov. It is measured at the wall outlet, so charging losses are already included; we don't add a charger efficiency on top.
• Gasoline is the EIA weekly regular retail price for the state where EIA reports one, otherwise for its region (for example, the Midwest or New England).

Electric bill

• Each appliance: watts × how many × hours a day × 30 days ÷ 1,000 = kWh a month. The state's average home is its average monthly use (EIA sales ÷ customers over the last 12 months) at the latest rate.

Tax credits and incentives

The federal residential clean energy credit (section 25D), which covered 30% of solar panel costs, does not apply to systems installed after December 31, 2025, under the law signed on July 4, 2025. The IRS counts the cost as paid when installation is completed, so a system paid for in 2025 but finished in 2026 doesn't qualify. Our solar payback calculator therefore starts with no federal credit; enter any state or utility incentive you qualify for. Checked October 2026.