Average Electric Bill in Arizona

We dug into the U.S. Energy Information Administration’s data[1] to look at the average monthly electric bill for Arizona residential households. These averages are for the full year of 2018, not any specific month of 2019, given that electricity usage & prices fluctuate month-to-month.

average monthly residential electric bill in Arizona
*This is 11.6% greater than the United States national average, which is $117.65.
average residential electric rate for households in Arizona
*This is 0.8% greater than the United States national average, which is 12.87¢/kWh.
1,028 kWh
average monthly residential electricity consumption in Arizona
*This is 12.5% greater than the national average (914 kWh) & the 18th highest in the U.S..
Arizona’s ranking for highest electric bill in the United States
*Relative to average monthly household income (2.94%), AZ has the 13th highest electric bill.

Why Are Electric Bills in Arizona Comparatively High?

The two factors that make up the cost an electric bill are (1) cost and (2) consumption. Looking at each, cost isn’t necessarily much higher in Arizona than what the national average is (0.8%), but the amount of monthly usage is notably higher (12.5%).  The most likely cause is the increase in cooling needs, given that Arizona has the 10th highest average yearly temperature in the country.

Reasons for High Electricity Rates in Arizona

Even though electricity rates are only 0.8% greater in Arizona than the national average, it’s important to understand what makes electricity more or less expensive. The factors affecting this number are:

  • Supply – an increase in the supply of energy brings costs down. For example, weather events such as high amounts of rain or high wind speeds can temporarily increase the supply of energy where there are hydropower plants or wind turbines to take advantage, and as a result, lower electricity rates.
  • Demand – an increase in the demand for energy causes costs to rise. This is because the use of more costly fuels, such as natural gas, help “fill in” for the rise in demand. For example, a heat wave might temporarily increase the demand for cooling and the subsequent need for fuels, and as a result, raise electricity rates.

Additional factors that impact electricity rates include state & federal regulations, global markets and even financial speculation.

Reasons for High Electricity Consumption in Arizona

Given that electricity consumption is more than just marginally higher in Arizona (12.5% is no small number), it’s important to understand exactly what electricity is used for. The EIA looked at the end uses of electricity in the average American household and found the following breakdown:

Note: “Other uses” includes small electric devices, heating elements, exterior lights, outdoor grills, pool and spa heaters, backup electricity generators, and motors not listed above. Does not include electric vehicle charging.

Tips for Lowering Electric Bill

  • Reduce space heating/cooling – given that heating & cooling make up a large part of the average electric bill, increasing energy efficiency in this area can have arguably the biggest impact on your bill. Here are some things you can do to reduce your usage in this area:
    • Use a programmable thermostat (can reduce heating/cooling by ~10%)
    • Use extra insulation
    • Dress up/down to the temperature
    • Replace your air filter more often
    • Check seals on windows/doors/appliances for openings/leaks
  • Reduce water heating – one of the next biggest portions of the average electric bill is from water heating, which can be reduced by showering at lower temperatures, taking shorter hot showers and by lowering the temperature on the water heater itself (ideally to 120 degrees Fahrenheit).
  • Adjust fridge & freezer temperatures – ideally, your fridge should be at 38 degrees and your freezer at 5 degrees Fahrenheit.

Where Does Arizona Get Its Electricity From?

The state of Arizona gets its energy from a diverse set of sources, with coal, natural gas, and nuclear power providing 88% of the state’s total electricity generation in almost equal shares. With that said, Arizona’s renewable energy generation is increasingly becoming a larger share, now at 11.5% of the total. As of 2017, solar will surpass hydroelectric in terms of total energy production, and now puts Arizona at number 2 in the country in solar generation (behind only California).

[1] Data from: https://www.eia.gov/electricity/data.php#sales