What is Normal Electricity Usage and Could You Save Money?

You might be wondering how your household’s electricity usage stacks up compared to that of your neighbours or other like-for-like households. What is normal electricity usage, and are you using too much?

By looking at your power usage and comparing it with average usage, you’ll be able to see if you’re running your lighting and appliances as efficiently as possible. This can help to identify potential power sucks. And, ultimately, you may be able to drive down your power bills.

Of course, it’s also important to understand the terminology involved on your bill and how different tariffs are structured.

In the following guide, we look at how electricity usage is measured and the average NZ usage figures. We also identify possible power guzzlers in your household, and deliver simple ways to reduce your bills. Plus we look at the potential benefits of solar.

Normal electricity usage: How is your power usage measured?

Power usage is measured in kWh (kilowatt hours). It’s important to pay attention to this figure both when reading your bill and when weighing up what type of heating/cooling and other appliances are best suited for your home.

Most bills include costs for fixed (also referred to as daily) and variable charges:

• Fixed charges – displayed as cents or dollars per day. This is a fixed rate, charged per day, regardless of how much power you use
• Variable charges – the charges for the actual electricity you use, based on your consumption of kWh

If your kWh usage has been steadily climbing (causing your variable charges to go up), it’s narrowing down potential causes. Below we’ll look at methods to reduce consumption.

Of course, it’s important to run energy efficient appliances. Both the Energy Rating Label (on a range of different appliances) and Zoned Energy Rating Label (for heat pumps/air conditioners) feature annual estimated kWh consumption.

When buying a new appliance, you should use this kWh figure to compare appliances and to estimate long-term running costs. A few extra dollars spent on an appliance with low running costs could save you hundreds of dollars over its lifetime.

Normal electricity usage: What is the average household power usage?

Government statistics show that the average annual energy consumption per Kiwi household has been declining over the past 15 years. This is part of the reason the low-user tariff is being phased out.

→ Related article: End of the Low-User Electricity Tariff

However, keep in mind that usage patterns naturally vary from one area to the other. For instance, consumption on the West Coast is typically lower because most houses are heated using fires, whereas in an area like Canterbury most houses are heated by electricity.

According to the Ministry of Business, Innovation and Employment, in the year to March 2021:

• Average yearly consumption per household – was 7223 kWh.
• The average cost per kWh – was 29.36 cents
• Average yearly expenditure per household – was $2121

Based on these figures, the average quarterly spend per household is $530.25 and the average monthly spend $176.75.

This will give you a general idea of electricity consumption around the country. Of course, larger households will consume more electricity, while smaller households will, as a rule, come in below the average.

When it comes to comparing like-for-like households, it’s also worthwhile getting in touch with your retailer. For instance, some retailers provide data on average usage by area, providing further insights into your neighbours’ usage and costs.

Compare electricity providers with Canstar Blue

Finding affordable power involves shopping around. And to help you find the best value electricity retailer, Canstar Blue rates NZ power companies for customer satisfaction and value for money, see the table below for some of the results, or you can click on the buttons below for the full results of our survey, and to compare bundled utility providers.

Canstar Blue’s latest review of NZ power companies compares them on customer satisfaction. The table above is an abridged version of our full results, available here.

See Our Ratings Methodology

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Normal electricity usage: Pinpointing power guzzlers

Pinpointing your household’s primary power guzzlers is the first step in developing strategies to drive down your usage. So it’s worthwhile weighing up the full scope of your usage across your home.

With this in mind, it will help to harness any tools your retailer provides (such as historical usage data, broken down by the day, week or month). These can provide insights into your household’s usage patterns.

These are the primary areas that make up the majority of the typical household’s power usage:

• Water heating – 27%
• Electronics and other electrical – 20%
• Refrigeration – 17%
• Space heating – 15%
• Lighting – 13%

Within these broad areas, you’ll be able to identify usage patterns and zero in on specific appliances that are consuming the most power.

As we explore below, you may be able to achieve this via a combination of ensuring you are on a suitable tariff, using energy efficient appliances and running your appliances in an efficient manner.

Normal electricity usage: How to use less power and save

To reduce consumption and help drive down costs, go through your household room by room and appliance by appliance. It’s important to remember that savings will build cumulatively over the long term, particularly when it comes to investing in energy efficient appliances. Because these may cost more in the short term, but deliver long-term running-cost savings.

It will be broadly worthwhile looking at the following:

• Tariff – this is a simple first step. Are you on the most suitable tariff for your household’s electricity consumption? You’ll need to look at your patterns of usage, using data from your retailer as a guide. It’s always worthwhile shopping around for the best deal.
• Appliance necessity and suitability – do you really need every appliance you are running? Are there appliances in your household consuming electricity in standby mode that are rarely used?
• Appliance energy efficiency – are you running energy efficient appliances? As mentioned above, keep in mind the long-term running costs. You may be surprised at how the savings add up over the longer term.
• Appliance usage – are you running your appliances efficiently? For instance, do you wait until you have a full load before running your washing machine or dishwasher? Is your refrigerator set up to run at maximum efficiency? Check out our tips here.
• Heating/cooling – is your home set up for heating/cooling efficiency (for instance, with effective insulation)? Are you using the most appropriate heating and cooling appliances? A combination of measures will help to drive down costs.
• Lighting – are you using LED lighting? While LEDs may be more expensive at the checkout, they can deliver significant savings over the longer term.

Using solar to help cut your power costs

It may well be worthwhile looking into whether a solar panel system is a suitable option for your household. While the upfront installation costs can be significant, solar panels are very much a long-term investment, and can provide around 25 years of use.

When used effectively, solar panels can provide a significant proportion of your household’s electricity usage. You need to look to the long term, weighing up how long it will take to pay back your initial investment and the savings that can be achieved.

Solar panels represent good value if you’re home during the day and time your appliance usage during sunlight hours. They can also reduce the costs of running big energy users, such as swimming pools and hot tubs.

There may also be potential to pair solar panels with a residential battery storage system, which allows households to store energy for use as required. But you must look to the long term, and consider your household’s specific requirements when weighing up the suitability of these types of systems.

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About the author of this page

This report was written by Canstar author Martin Kovacs. Martin is a freelance writer with experience covering the business, consumer technology and utilities sectors. Martin has written about a wide range of topics across both print and digital publications, including the manner in which industry continues to adapt and evolve amid the rollout of new technologies