How to Read Your Electric Bill: A Line-by-Line Guide
Most electric bills combine two separate charges — supply (the actual electricity, priced per kWh) and delivery (the wires and infrastructure that get it to you) — plus fixed fees and taxes; the supply portion is usually the only part you can actually shop around for.
Supply charges: what you’re paying for the energy itself
This is the cost of the electricity you actually used, priced per kilowatt-hour (kWh). If you’re on utility default supply, this rate is set by your utility (and regulated); if you’ve signed up with a competitive supplier (an ESCO), this rate comes from that contract instead. Supply is typically the largest line item and the one part of your bill you can actively shop for a better rate on, in states with deregulated energy markets.
Delivery charges: what you’re paying to get it to your home
Delivery (sometimes called "distribution" or "transmission") covers the cost of the physical infrastructure — poles, wires, substations, meter reading, and maintenance — that gets electricity from the grid to your building. This charge goes to your utility regardless of who supplies your actual electricity, and it’s regulated, so it isn’t something you can shop around for.
Fixed fees, riders, and taxes
Most bills also include a flat "customer charge" or "basic service charge" that applies no matter how much you use, plus various riders that fund specific programs (infrastructure upgrades, low-income assistance, storm recovery) and standard state or local taxes. These are usually small individually but can add up to a meaningful share of the total, especially on a low-usage bill.
Usage and rate history
Most bills show your usage for the current period alongside a small chart of the past several months or the same month last year — useful for spotting a real trend versus a one-off spike. If your bill doesn’t include this, your utility’s online account portal almost always does.
Frequently asked questions
What’s the difference between supply and delivery charges?
Supply is the cost of the electricity itself, which you can sometimes shop around for; delivery is the cost of the infrastructure that transmits it to you, which is regulated and the same regardless of your supplier.
Why do I have both a utility and a supplier on one bill?
In deregulated markets, your utility still delivers the electricity and bills you (often on the supplier’s behalf), even when a separate competitive supplier is providing the actual energy at a contracted rate.
What is a "customer charge"?
A flat fee that covers the fixed cost of connecting your account to the grid — metering, billing, and account maintenance — charged every period regardless of how much energy you use.
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