2013 Utilities

While looking over my budget and thinking about the recent post on the CPI, I decided to post the status of our household utility usage. I have been keeping track of utility costs for several years because some of these don’t act like their underlying commodities. There are too many taxes that get added on and too many regulations that get itemized on each statement for it to be that simple.

Table 1. Percentage of Expenditures
Category Percent
Natural Gas 26%
Television 25%
Electricity 18%
Internet 17%
Water 9%
Garbage 6%

Table 1 lists the six categories that I have collected. You might immediately notice that Telephone is missing. I have removed it because the home telephone is included in the Internet category while the cell phone costs not included. Cell phone costs are unpredictable due to changing phones, changing plans, adding phones, and removing phones from the account. Creating a category called cell phone usage (which would exclude anything related to the hardware) would show little change and not add anything to this analysis.

Combining Natural Gas and Electricity results in nearly 44% of the total spend. These two go together to power the home in terms of heating, ventilation, storing food, and creating light. They act very different, though. Natural Gas is seasonally variable where a baseline is developed in the summer months as the constant of heating water is the only usage. Electricity is more stable across the months with the variation being attributed to the furnace fan blowing more often in the winter months and longer usage of lighting during the evenings.

Table 2. Annual Spend Change
Category Percent
Natural Gas -4.4%
Television 13.1%
Electricity 16.6%
Internet 0.0%
Water -3.1%
Garbage 7.4%
Overall 4.6%

Okay, let’s move on to Table 2 which shows the annual change in spend by category. Please be aware this is the change in our spend and includes a change in usage, where applicable. For example, our Television spend has gone up 13.1% in 2013 compared to 2012, but that rate of change is not dependent upon our time viewing television. In looking at Table 2, it does lead me to wonder where the additional spend in Electricity is coming from. I shall have to expand the table and look at our consumption and the price per unit. That would be useful for Natural Gas, Electricity, and Water. The other three are price based and not driven by usage. That doesn’t make me feel good about the cost increase from Television and Garbage.

The final line in Table 2 shows our increase in spend from 2012 to 2013. That 4.6% increase is quite a bit more than the 2013 CPI of 2.4%. I think it is also more than my salary increase in 2013. The first thing to look at will be usage. If that is increasing, then it is time to consider more conservation tactics. If it is not, then the cost of our six categories of utilities is rising faster than the reported CPI. Before jumping to any conclusions, I shall start on the data gathering of usage and price per unit.


Author: dmcnic

Educated as an economist, I now work as an Analytical Professional for a manufacturing firm. I have have a second job as a part-time lecturer at the University of Washington in Bothell. While all baseball interests me, the Mariners are my home town team. Married with one dog.

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