Figuring out your electricity usage from the electric company isn’t easy. Utility companies write so many different numbers on the bill that you can almost never get a super clear picture out of them. What you are looking for is your kilowatt per hour (kWh) rate.
   But even this is more difficult that it sounds. Most electricity runs on a tiered system that charges more per kWh to heavy users.

Depending on the way a particular power company operates (and the population of the area), this could cause a continuous fluctuation in the kWh rate for the customer.

This is meant to encourage saving power by charging heavy consumers exponentially more money. These rates are often set in accordance to local or state laws, so the usual free market factors don’t apply.

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      For example, Southern California Edison (SCE) has a four-tier system for homeowners, where low usage Tier 1 consumers pay about $.13/kWh and slightly higher users (people who use up to 30% electricity over the Tier 1 baseline) pay $.16/kWh. These first two tiers are meant to effectively cover basic home usage for things such as lighting, cooking, and heating, as well as home electronics.

    The California Public Utilities Commission sets the exact baselines for these tiers. Tier 3 is where things get expensive, with costs jumping to around $.27/kWh and Tier 4 maxing out at $.32/kWh. If you are running a 1000-watt light in your grow room, you will most likely be Tier 4, paying twice as much per unit of electricity as your non-growing neighbor. To confuse things even more, utility companies have seasonal rates.
    San Diego Gas & Electric charges Tier 4 users $.29/kWh during the winter and $.31/kWh during the summer. This is because summer in Southern California sees an overall increase is electricity usage due to air conditioning throughout the region.

    Besides seasonal differences, there’s even micro-time modifications to rates called peak hours, when you pay a higher rate running your electric devices in the middle of the day, when demand is the highest, versus in the evening.

    A lot of growers avoid this by simply running their grow rooms at night. By now, you’re probably scratching your head at the 3D chess game that is utility rate calculations. In some remote regions, electric bills get even more difficult to decipher. In many cases, the overall operating/service cost is split between the residents in the region. These costs make up a part of the total kWh cost. As the area becomes less or more populated, each user’s kWh rate increases or decreases accordingly.

   Depending on the way a particular power company operates (and the population of the area), this could cause a continuous fluctuation in the kWh rate for the customer. As I said before, they don’t make any of this information easy to find. We spent several minutes searching the SCE website and never found the detailed pricing breakdown. The best way to get to the bottom of this rabbit hole is to call your electric company and make them explain.

   Expect to be on the phone for a while. Understanding your electric bill isn’t easy. But if you want to run a profitable home grow, you have to be able to predict your costs. At the very least, we recommend anticipating worst-case cost (Tier 4, on-peak hours), and consider anything below that a nice little bonus.