Utility Companies and the Average Family

The average family will use about 900 kilowatt-hours (kWh) a month, for an approximate yearly total of 10,800 kWh. Should the family live in climates of extreme heat or cold, this number can drastically change. If a family is familiar with their seasonal usage it is possible to take steps to lower their usage and their monthly bill. An average family has somewhere between $24,000 and $32,000 income a year. Utilities cost around $7,500 a year and take about 11% of the monthly budget. For some, this is an incredibly large amount of money out of the budget that is used to house, feed, clothe, and provide medical care to a family.

Electricity is necessary for a family to run their household efficiently; electric companies use this as a money-making opportunity. To be able to have electricity, most electric companies require a deposit to be made. Several factors can affect the amount paid as in: location, services used, and credit scores. The average deposit ranges from $200 to $300. A deposit that grows interest in the company’s bank account is held for the duration that services are given for a service area and is a requirement for any person who is seeking their service. Should the family move out of that provider’s area, the deposit will be returned once the account balance is paid in full. If a family continues to move around in the provider’s area, not only will the person not receive their original deposit back, depending on payment history it is possible that the company will request more money to be placed into deposit. Paying out this kind of money to a company can be a hardship for many families. There are about 40% of families struggling just to meet their needs.

Some areas have electricity companies with no deposit. These companies also offer alternative plans for service and payment. Depending on your situation these companies may fit a family’s need to have payments that are flexible. With no deposit electricity plans, energy is purchased up front. It is very similar to a prepaid cell phone plan. You pay for what you are planning to use and if you need more, it is possible to buy more. There are some aspects to this type of plan that may not be ideal. The price of kWh will vary over time and there is not a contract stating a price. Generally, a single kilowatt is $0.12, this may go up or down without any notice with a no deposit plan.


For some, to have an unset amount could possibly cause hardships depending on the value of the variances. Unlike with long term electricity plans, there are no established payments. It is possible to make frequent small purchases of electricity or to make large purchases occasionally. It is all based on the needs of the family. For the average family, the possibility of having service providers who do not require a down payment could be a game changer.

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