What Uses the Most Electricity in a Home?

Not every appliance in your home has the same impact on your electric bill. A few major systems—your HVAC, water heater, and large household appliances, like your refrigerator, clothes dryer, washing machine, and dishwasher —use the most energy month after month. Understanding how much these “big three” really cost to run can help you make smarter choices to reduce waste and keep your bill in check.

HVAC Systems: Why Heating & Cooling Use the Most Electricity

Heating and cooling systems account for approximately 32-43% of a home’s energy use. These systems run almost all year, especially in climates with extreme temperatures, which makes them the largest consumer of electricity in most households. However, that doesn’t mean there’s nothing you can do to lower your electricity bill. You can save by:

• Installing a smart thermostat to set efficient schedules.
• Replacing air filters regularly so your system operates at peak performance.
• Scheduling seasonal tune-ups to maintain efficiency.

Water Heaters: How Much Electricity They Really Use

Water heating uses about 12-18% of household electricity. Daily routines like taking hot showers, running dishwashers, and doing laundry quickly add up on your monthly bill. Luckily, there are a few simple ways to reduce electricity costs without sacrificing comfort:

• Lower the thermostat on your water heater to 120°F.
• Add insulation to the tank and nearby pipes.
• Explore upgrades such as tankless or solar water heaters for long-term savings.

Appliances and Devices That Use the Most Electricity

Everyday appliances and devices like refrigerators, washers, dryers, and dishwashers make up almost one quarter of your home’s electricity use. Each appliance may not match the HVAC or water heater in terms of energy demand, but together they are a significant factor in your bill. Take a look at these major appliances and their average yearly kWh usage:

Here are some things you can do to lower their consumption and reduce your overall bill:

• Choose ENERGY STAR® appliances when it’s time to upgrade.
• Only run washing machines and dishwashers with full loads.
• Air-dry your clothing to reduce dryer usage.

Pool Pumps

If you have a pool, your pump could be one of the biggest energy users in your home. According to ENERGY STAR®, pool pumps can be the second-largest energy consumer after heating and cooling systems, costing up to $310 per year to operate. An ENERGY STAR® certified pool pump uses up to 70% less energy than standard models. These pumps adjust their speed based on your pool’s needs, keeping the water clean while reducing unnecessary power use. Running your pump efficiently and choosing an ENERGY STAR® certified model can make a noticeable difference on your bill.

Lighting typically accounts for about 15% of a household’s electricity use. That’s usually less than your HVAC, water heaters, or large appliances, but it’s one of the easiest areas to cut costs. Small upgrades, such as switching to energy-efficient bulbs or installing smart controls, can deliver noticeable savings over time.

Best Lighting Upgrades to Cut Electricity Costs

Switching to LED lighting is one of the simplest ways to see real savings on your bill. The U.S. Department of Energy estimates that households save an average of $225 per year by replacing older incandescent bulbs with LEDs. That’s money back in your pocket without changing your usage habits.

The most effective strategy is to focus first on the lights you use most frequently. Kitchen fixtures, living room lamps, and hallway bulbs are ideal starting points, as they stay on the longest. Choosing ENERGY STAR® certified LEDs means you’ll get bulbs that last for years and use only a fraction of the electricity. Even replacing just a few key bulbs can set you on the path to steady, year-round savings.

Motion-Activated and Smart Lighting: Save Energy Automatically

Motion-activated and smart lighting make saving energy effortless. These small upgrades add convenience, safety, and control to your home.

• Motion sensors: Ideal for hallways, garages, closets, and outdoor spaces. Lights turn on only when needed.
• Smart bulbs: Control brightness, color, and schedules right from your phone.
• Smart plugs: Add app or voice control to regular lamps and set timers for automatic shut-off.
• Integrated systems: Pair with your smart-home app to track usage and automate lighting throughout your home.

Think you know what’s driving up your electricity bill? Some of the biggest culprits are the ones you don’t even consider.

Phantom Load: Devices That Use Power Even When Off

Electronics like TVs, game consoles, cable boxes, and phone chargers continue to draw electricity even when they’re turned off. This is known as standby power or “vampire energy,” and it can account for up to 10% of a household’s energy use, costing around $100 per year in wasted electricity.

You can cut costs from phantom loads by:

• Using smart power strips that cut electricity when devices aren’t in use.
• Unplugging rarely used chargers and electronics.
• Investing in auto-shutoff plugs to stop the constant trickle of power.

Holiday Lighting: Energy Costs and LED Savings

Festive lights bring holiday cheer, but they can also quickly raise your energy bill. LED lights use 75% less energy than traditional incandescent lights and last up to 25 times longer. That means switching to LED holiday lights can save you money without compromising your decor. You can also:

• Set lights on timers so they only run during evening hours instead of all night.
• Try solar-powered outdoor lights to reduce your electricity use significantly for your yard and walkways.

Lowering your electricity costs doesn’t have to mean major upgrades or expensive equipment. Small, everyday changes add up fast. Here are 10 quick wins you can start today to make your bill lighter and your home more efficient:

1. Switch to cold water for laundry: Most of the energy used in a wash cycle is dedicated to heating water. Cold cycles clean just as well and save energy.
2. Clean your dryer lint trap: A clean lint trap improves airflow and reduces drying time. That means your dryer works less and costs less to run.
3. Unplug unused chargers and devices: Cut down on phantom load by pulling the plug on electronics you aren’t using.
4. Turn off lights when leaving a room: Simple, but effective. You can also replace bulbs in high-use areas with LEDs.
5. Run full loads only: Whether it’s the dishwasher or washing machine, make every cycle count.
6. Close blinds and curtains during hot afternoons: Blocking direct sunlight helps keep your home cooler, allowing the AC to work more efficiently.
7. Use ceiling fans wisely: Fans make you feel cooler, but they don’t lower the room temperature. Turn them off when you leave a room.
8. Adjust your thermostat by a few degrees: Even a small shift can reduce heating and cooling costs without compromising comfort.
9. Set your water heater to 120°F: This setting provides ample hot water while minimizing wasted energy.
10. Air-dry clothes and dishes whenever possible: Let nature do the work and save on appliance runtime.

In areas that have electricity deregulation, choosing the right electricity plan can make a big difference in your monthly bill. The key is finding one that matches how and when you use power. Power Wizard helps you compare plans side by side so you can pick the best fit for your home and lifestyle.

• Fixed-rate plans: Offer price stability with the same rate each month, protecting you from market fluctuations.
• Variable-rate plans: Change with market prices and other factors set by your REP.
• Time-of-Use (TOU) plans: Free or reduced electricity usage during evenings and/or weekends.
• Bill credit plans: Give you a credit on your bill when your usage falls within certain ranges.
• Tiered plans: Charge different rates based on how much energy you use.
• Green energy plans: Source all or part of your electricity from renewable resources like wind or solar, reducing your environmental impact.
• Solar buyback plans: Allow you to earn credits or payments for the excess solar energy your panels send back to the grid.

The electricity that powers your home has an environmental cost. According to the U.S. Energy Information Administration, the average American household uses about 10,600 kilowatt-hours (kWh) each year. That translates to roughly 9,110 pounds of CO₂ emissions annually, which equals the impact of burning 465 gallons of gasoline.

Every kilowatt-hour you use at home connects to power plants that release greenhouse gases. When you manage energy use wisely, you shrink your carbon footprint and contribute to a cleaner future.

Solar + Battery Storage: Cut Costs and Reduce Grid Use

Solar panels generate lower-emission electricity from sunlight during the day, and batteries store that power for use at night or during peak pricing hours. This can reduce your reliance on the grid, help you avoid higher rates, and create long-term savings. By offsetting part of your household’s demand for fossil-fuel-generated power, solar and storage can also contribute to a more reliable and lower-carbon grid.

HVAC systems, water heaters, and large appliances account for most of your home’s electricity use. Targeting these areas with simple adjustments and smarter upgrades gives you the best chance to lower costs.

You don’t need to know every detail about energy use to save. Power Wizard makes it simple to compare providers and find the plan that works for you, so you can cut costs and power your home the smart way. Enter your ZIP code into our smart comparison tool to get started.