Don't let the cost of your monthly utility bills catch you by surprise
As a brand-new homeowner, there's nothing worse than receiving your monthly utility bill only to realize it’s a lot more than you thought. While most homeowners focus on things like amenities and the cost of housing, the price tag of basic utilities may not be an upfront consideration.
However, once you’ve signed the contract and unpacked the truck, there's no backing out. That’s why it's smart to figure out where utilities are the most and least expensive so you can make an informed decision. Read on to find out which states you'll pay the most (and the least) for basic utilities.
What Are the Most Common Utilities Homeowners Pay?
While some homeowners would consider things like Netflix, Hulu, or a DashPass a monthly essential, utilities refer to electricity, water, natural gas, and internet and cable. In some cities and states, things like garbage and sewer are also charged as utilities.
The calculations we used to find out which states have the highest and lowest utility costs only include electricity, water, natural gas, and internet and cable.
How We Got Our Data
Methodology: To understand the cost of various utilities, we pulled data from several publicly available sources.
Electricity costs were derived from the U.S. Energy Information Administration. To calculate average monthly costs, we used information including the average monthly energy consumption in each state and the average cents per kilowatt-hour.
Monthly and annual natural gas costs were calculated using average gas prices and usage amounts from the U.S. Energy Information Association.
Internet and Cable
Internet and cable costs were identified using Doxo’s 2021 U.S Cable and Internet Market Size and Household Spending Report.
Average monthly and annual water costs were determined using Dripfina’s 2022 Report on the Average Monthly Cost of Water by U.S. States.
Median Household Income
The 2019 Census on Median Household Income in the U.S. calculations were determined using the 2019 American Community Survey.
The States With the Most Expensive Utility Costs
If you live in Hawaii, New Hampshire, Connecticut, California, or Alaska, you're likely used to paying a premium for your basic utilities (among other things). Did you know you're paying an average of $150 to $200 more per month than homeowners in the states with the lowest utility costs?
The States With the Least Expensive Utility Costs
If you live in Utah, Idaho, Montana, New Mexico, or Nebraska, you probably have it better than you realize when it comes to how much you're paying for utilities. Homeowners in Utah (the lowest cost state for utilities) save an average of $2,366.52 per year compared to their counterparts in Hawaii (the highest cost state for utilities).
Why Are Utilities More Expensive in Some States?
While the overall cost of utilities varies from state to state, different utilities cost more or less for different reasons.
Electricity fluctuates the most based on location, with monthly costs averaging $201.05 in Hawaii and $79.13 in Utah. Prices vary per state because of things like local fuel costs, availability of fuel, power plants, and state and local regulations.
In Hawaii, for example, the state with the highest electricity costs, prices are high primarily because most of the electricity is generated with costly imported fuel.
If you’re paying more than you’d like, there are several ways to lower your electric bill, including upgrading to energy-efficient appliances, weatherizing your home, and adding a smart thermostat.
Monthly water bills range in cost from just $18 per month in Utah to $91 in Washington. Water costs vary based on how much access each region has to fresh, self-renewing water sources, as well as local regulations on usage and billing.
Generally, areas with easier access to water offer lower water costs, while dryer areas have higher costs. While reducing your water usage can certainly help you lower your water bill, if it’s surprisingly high, you might also want to check for water leaks.
Internet and Cable
The internet may not have been considered a utility in the past, but we all know how essential it is for work, learning, entertainment, and connecting with friends and family.
Internet and cable costs range in price from $92 per month in South Dakota to $148 per month in Alaska. Local markets largely impact these prices rather than true infrastructure costs.
Natural gas ranges in average cost from $6.87 per month in Idaho to $48.44 per month in Hawaii. While a relatively low bill, there's still quite a difference depending on where you live.
Like other utilities, natural gas prices are impacted by the local retail climate, operating costs, local taxes and regulations, and the distance each area is from the natural supply. Hiring an energy auditor can help you identify ways you might be able to save on your natural gas bill each month.
See How Your State Stacks Up
If your state isn't one of the top 10 least or most expensive, you might be wondering how you stack up. Check out the list below to find out whether residents in your state are paying more or less than most other U.S. households.