How to Reduce Your Financial Liability To Power Companies?

August 10, 2016

how to save electricity bill

No one likes to see a rising electricity bill. According to the latest data from U.S. Department of Energy, an average American pay $110.21 monthly for electricity in 2013, and today in 2016, it climbs closer to $145, with some states even pay more than $210 monthly.

According to American Power, Americans spend 5%-22% of their after tax income to pay utility bills. At the very least, the money can be spent for an extra fancy dinner for the weekend. In the developing countries, some are struggling to pay their utility bill, and can even be a life or death situation.

This is a serious matter at hand. The financial analyst giant Morgan Stanley even predicted that if the high fixed charge of electric bills can cause people to say goodbye to their power companies, and at the same time, going power independent will be more cheaper than ever, even cheaper than your utility bills.

In a far fetched future? Not so. They predicted it could be as close as the next few years. In fact, it's already started. So how do people forego their power companies? Here are a few strategies they employ:

 Be Creative In Energy Conservation.

Conserving energy is the most conservative way (pun intended) to gain an advantage over your power companies. Here are a few things you can do:

  1. Refrigerator accounts for 20% of your electricity bill, how to reduce refrigerator energy? Check out a few tips from Mother Earth News here.
  2. Choose the most energy efficient appliances and lightings available.They might cost more initially but will save your money in the long run. Here is a comprehensive guide from the U.S. Department of Energy for your lighting choices as well as their home energy saver guide.
  3. Careful home heating or cooling can save a lot of energy in the long run. On winter, Set your thermostat at 68 F (20 C) at daytime, and 55 F (13 C) at night. Even lowering your thermostat at just 2 degrees can save 6 percent of energy spent.
  4. Cleaning a dirty air conditioner filter save another 5 percent of energy.
  5. Front loading washing machine is 60-70% more energy efficient than traditional ones. Is it time for a replacement? Consider getting this one.
  6. Small things like insulating your walls and ceilings can save 20-30 percent of home heating bills, planting trees (lighter color in a warmer climate, darker color in a cold climate) can also significantly reduce the heating or cooling needs.

Still not enough for you? Dare to save even more? Let's go to the next level.

Invest In Renewable Energy Such As Solar Panels or Wind Turbine Power Systems.

Let's answer the important question first, which one is better? Solar or Wind? For household usage, generally solar is the better choice. However, it will be highly dependent on your geographical locations.

If you live in an area with more wind movements, wind can be a better option, as it takes less space than the solar version (although taller.)

What's the cost of installing a solar panel or wind turbine? Chek out our previous blog here for the details.

Will it actually save money in the long run? Check out this simple calculator by Utah Clean Energy, but generally, yes, you will save money in the long run.

The thing is, both solar panel and wind turbine have a weakness over your power companies: they need sunlight or wind to be functional. The answer for this issue? Install a battery.

Give Your House A Battery Power Storage Option.

By using a battery, you can save the excess sunlight for night electricity, and save excess wind energy for later use when no wind movement is available.

The battery price is cheaper than ever before, and Tesla is planning to reduce it 30% more with their new giga factory in a very near future.

For example,the popular Tesla solar Powerwall battery will cost you around US$3,500 today for the 10kW system. With installation fees and all that, it will cost you around US$15,000 in total. Assuming you paid the U.S. national average electricity bill of approximately $140, you will get an ROI (Return on Investment) after 8.9 years.

Here is a complete ROI calculation for installing a Powerwall, and can be a guidance for you when deciding to buy a battery.

Will installing a battery be a straightforward process, and it will run your entire house instantly? Actually, no. Your house ran with AC current, while batteries will provide you with DC current. So what should we do about this? Let's move on to the next step.

Create A Mini DC Grid For Your Home.

Most people are skeptical, even afraid with changing their AC current to the 'uncommon' DC current, simply because they didn't understand the difference between the two.

What is the advantage of AC current vs DC current, or vice versa? Actually just one, AC current is a lot easier to  'transform' to change the voltage, or to change it to DC, while on the other hand, DC converters are a bit more expensive.

Google founders and leaders, Sergei Brin and Larry Page proposed this idea to have separate 12-V outlets for our PCs back in 2006.

Our PCs (and laptops) run on DC power, hence you might see a box between the power cord and the plug to your laptop. That is an AC to DC inverter, meaning it transforms the AC power from our power companies into a DC power our computers will need.

The thing is inverters are extremely inefficient. The Google boys, on the same article, claimed that using a DC current to power the PCs of google will save over 40 billion KWh in three years, saving them $5 billion.

Now, we are putting the same principle by running our house with 100% DC power.It will be a lot more efficient than before, and it will save you a lot of money over the years.

Here are the steps to get your house up an running with DC electricity.

1. Battery Powered Houses

Ready to start your DIY wiring project?Here are a few nice guides for wiring your house with DC current:

  1. 1.An in-depth guide (video) by Solar Power Videos for components needed for a solar powered home.
  2. 2. A guide for the wiring process by 7 Trumpets Pepper.
  3. 3.For those who preferred text guide, here is a comprehensive one by Backwoods Home.

Not a big DIY fan and want a professional to do it? Depending on your location, your battery seller might also provide the service to re-wire your house. Otherwise, check out for off-grid contractors near your are who are willing to do the job.

2. Using DC Appliances and Lightings

Many DC appliances and lighting choices are available. Check this DC refrigerator, for example.

For lighting system, you can check our broad collection of 12 and 24 volt lamps here.

Many of your appliances already run on DC powers, such as PCs or laptops as mentioned above. As a rule of thumb, check if you need an inverter to power up the appliance,the inverter/adapter usually stated the DC voltage needed.

Many LEDs are typically DC powered from the get-go, and needed an inverter to run on AC power.

Using a DC current to power up DC appliances and lightings will be 30% more efficient than using an AC-DC inverter. Meaning, you already save 30% of your electricity bills. 

3. Using Converter to Power Your AC

There are some appliances not available in DC, or you might wanna keep some of your old AC appliances. Can we run it in our new, DC system? Yes!

The answer is to get a DC-AC converter. A converter with 1,000W capacity will cost around US$50-100 depending on brand and quality.

After that, you can directly plug your old appliances to the converter, and it's good to go. Remember, calculate the total wattage you need, and make sure it won't exceed 70% of the converter capacity for safety reasons.


So let's answer the big question. Is it possible to say goodbye to our power companies? Yes! Will it cost you more? Initially yes, but actually, you'll be saving close to 30% each year, and can be profitable after that.

In the very near future, the cost for going power-independent will also go lower. Maybe, going off-grid is the future, after all.

So what are you waiting for? Are you ready to say goodbye to your power company?

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