What is a kWh? Why homeowners should know the kilowatt-hour

Does your electric bill feel like it's written in a language you never learned? To be frank, I don’t fully understand the full report each month I get it.

But knowing one key term can demystify much of the bill. At the center of it all is the kilowatt-hour (kWh). That’s the standard unit used to track your home's energy consumption and calculate your monthly power costs. It can help you make sense of what’s actually going on when you flip a switch, dry your clothes, or put home solar panels on your roof.

What does a kWh measure?

Kilowatt-hours are a measurement of electric power. It’s used to quantify things like home electricity consumption, solar energy production, or EV battery capacity in the United States. 

Breaking down kWh measurements piece-by-piece, a kilowatt is a unit of energy equal to 1,000 watts and an hour is… well, an hour, or sixty minutes. Therefore, a kilowatt-hour is the amount of energy equal to 1,000 watts generated, transferred, or consumed over a one-hour time period. 

What is 1 kWh of electricity equal to?

Let’s look at kilowatt-hours through the lens of what they can power. To understand what 1 kWh of electricity is equal to, we need to know: 

1. An electric device’s wattage
2. The run-time

For instance, let’s say you need to run a washing machine that requires 500 watts of electricity. If you turn it on for 1 hour, then 500 watt-hours (or 0.5 kWh) will be consumed. After another hour, 1000 watt-hours (or 1 kilowatt-hours) will have been used in total. Likewise, a 2 kW (or 2,000-watt) device would consume 1 kWh of electricity in just 30 minutes. 

Here’s how long it would take typical household appliances and devices to consume one kilowatt-hour.  

Note: The table above is designed to show typical kWh consumption for home appliances and electronics. Actual kWh will vary by appliance make, model, efficiency, and age. 

Monthly electric bills and kWhs

In the US, the average home consumes approximately 900 kWh of electricity each month. Actual consumption varies for every home and is primarily impacted by the size of the home, efficiency of appliances, time of year, and ongoing energy habits.  

How many kWh per day is normal?

Knowing the average American home consumes around 10,800 kWh annually, roughly 29.5 kWh could be considered normal on any given day of the year. Electricity consumption is highest during the winter and summer months, because heating and cooling are the largest uses of electricity at home.. 

Daily kWh consumption also varies heavily throughout different states and regions, mainly driven by climate considerations. The highest averages for home electricity use in the US can be found all across the hot and humid South, including high daily consumption rates (>35 kWh per day) in Alabama, Mississippi, Louisiana, and surrounding states.

Want to see exactly where your home's energy goes each day? The free Palmetto app breaks down your consumption in real-time and shows you simple ways to lower those kWh numbers - and your bill.

How do you calculate cost per kWh?

To calculate the kWh rate you pay for electricity, simply divide your total utility bill (minus any flat fees or taxes) by your total power consumption. The kWh rate your utility charges may also be displayed next to the consumption recorded on your electricity bill. 

In some parts of the country, electricity rates will vary throughout the day, week, and year, known as TOU (time of use) rates or demand-based pricing. Utilities with these models charge higher rates per kWh during peak billing hours, which usually occur in the late afternoon and early evening. Homeowners can shift electricity use outside of peak demand hours and reduce their cost.

Average cost per kWh in the US

According to the most recent state and nationwide residential electricity rates from the US Energy Information Administration, the average cost of residential electricity was 18.31 cents per kWh in August 2025.

The residential electricity rate average has been steadily increasing: 13.66 cents in 2021, 15.04 in 2022, 16.00 in 2023, and 16.48 in 2024.

With rates climbing every year, shaving kWhs from your usage is more impactful than ever. The Palmetto app turns those confusing kilowatt-hours into clear weekly targets and actionable tips that actually lower your bill.

Solar panel kWh explained  

Just as the kWh you purchase from the utility are charged to your electricity bill, the kWh your solar panels produce can be credited to your account. The value at which the solar kWh you export to the grid are redeemed will depend on the terms of your utility’s net metering or net billing structure.

Calculating solar kWh is a lot like calculating electricity consumption, in that the main factors are the panels’ wattage and time. Although there are many other factors that influence solar production efficiency (such as sunlight intensity and system age) you can calculate approximate solar kWh with the formula: Total System Wattage x Number of Peak Sun Hours.

So in ideal operating conditions, a 6.8 kW (6,800 watt) solar energy system may produce roughly 34 kWh of electricity daily, if it receives 5 peak sun hours per day. As the number of peak sunlight hours your property receives is dependent on the season, the same set of solar panels will produce various amounts of electricity throughout the year.

Since the number of kilowatt-hours your solar panels varies throughout the year, it’s likely your savings will too. Understanding how production is measured and varies can help you get the best solar deal possible and identify and weed out the bad offers.

If you are interested in learning more about how solar energy can save you money, you can get an estimate with Palmetto’s solar savings tool today. 

Frequently asked questions

What is a simple definition for a kilowatt-hour?

A kilowatt is 1,000 watts and a kilowatt-hour is a measure of 1,000 watts, produced or consumed, over one hour. 

How many kilowatt-hours does a typical home use?

In 2022, residential electric customers used an average of 10,791 kWh a year, or about 899 kWh a month.

How many kWhs does an air conditioner use?

A central air conditioner with an average draw of 4,000 watts uses 1 kWh per 15 minutes of running, or 4 kWhs per hour.

How do I choose the right solar energy system for my home?

The right system for your home will depend on numerous factors, including your current electricity usage, the size and layout of your roof, and how much electricity can be generated from it.