Cost of Utilities By State And City: What’s The Difference?

Rent, income, and taxes have a large impact on your cost of living. However, utilities such as gas, electricity, water, and internet connection are a part of the equation as well! Looking at the cost of utilities by state, there’s as much variation there as in other cost of living considerations. Thanks to our friends over at InMyArea.Com, we can examine the differences.

Why Do Utility Costs Vary?

What you pay for electricity in Manhattan, New York is going to be different than what you pay in Denver, Colorado. There isn’t a difference between the juice going into your iPhone in the Rocky Mountains or on 42nd street; however, there are several factors that determine the price.

According to the US Energy Information Administration, these factors include:

 

cost of utilities by state

  • Fuels: Fuel costs vary depending on the per-unit cost of the fuel, such as dollars per ton for coal or thousand cubic feet for natural gas. Power plants generally use electricity generators with relatively high fuel costs during periods of high demand.
  • Power plants: Each power plant has construction, maintenance, and operating costs.
  • Transmission and distribution system: The electricity transmission and distribution systems that deliver electricity have maintenance costs, which include repairing damage to the systems from accidents or extreme weather conditions.

 

 

  • Weather conditions: Rain and snow provide water for low-cost hydropower generation. Wind can provide low-cost electricity generation from wind turbines when wind speeds are favorable. However, extreme temperatures can increase the demand for electricity, especially for cooling, and demand can drive prices up.
  • Regulations: In some states, Public Service/Utility Commissions fully regulate prices, while other states have a combination of unregulated prices (for generators) and regulated prices (for transmission and distribution).

When all these factors align, it’s no wonder why looking at the cost of utilities by state and even city reveals large differences. The same disparities can be seen for the cost of gas, water, internet, and more.

What About Denver and Manhattan?

In a previous post, we examined cost of living differences between Denver and Manhattan. Manhattan ranks #1 in cost of living according to City vs City’s algorithm. Denver ranked 44nd.

Based on these rankings, you would expect the cost of utilities in Denver to rank lower than Manhattan.

Manhattan Electricity

There are about 25 utility service providers within New York. The average electric bill comes in at roughly $78.46 per month.

Denver Electricity

There are about 15 utility service providers in Denver, Colorado. The average electric bill comes in at roughly $104.60 per month.

With a price difference that averages about $26.14 per month, the cost of electricity in Denver, Colorado is actually HIGHER than Manhattan, New York. Some of this is due to the above factors. However, New York’s  8.875% sales tax doesn’t help either. Denver’s comes in at 7.65%

When looking at utilities as a whole, however,  Manhattan residents can expect a monthly bill around $379.28

Denver: $225.

Cost of utilities

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What’s Up With Denver?

Looking at just the cost of utilities by state or city, you might think Denver is an expensive place to live! However, the average electric bill in the US is $112.00, meaning that Denver is slightly below average when compared nationwide.

It should also be noted that New York is an energy deregulated state while Colorado is not. This means that New York has less barriers to consumers looking to select their energy providers or providers looking to sell energy to consumers.

As a result, costs in deregulated states tend to be lower, despite other considerations. It isn’t the only factor, however it is one reason why New York energy costs may be lower than Denver despite the fact that the overall cost of living in New York remains high.

Costs Vary

Of course, everything is relative! When looking at the cost of utilities by state, you can see that costs vary. Furthermore, costs vary based on your living situation. Anyone who has ever moved from a one bedroom apartment to a four bedroom house has realized that. Especially if something like central air conditioning is involved!

There are many factors that impact your overall cost of living. What you pay for utilities is one such consideration. InMyArea.Com is a localized home services comparison shopping site a one stop shop where you can compare prices and purchase high speed internet, cable, home security, and many other services.

For everything else, there’s City vs City. City vs City is a cost of living calculator which examines the true cost of living in your city. The app examines after-tax income, housing and transportation costs, state and local taxes, and more.

As a result, you’ll be able to see the real cost of living in your area. If you’re considering a move, compare costs with City vs City and see how your cost of living will be impacted. Download the City vs City App today and start comparing! Already moved-in and looking to lower your costs? Check out InMyArea.Com and see if you can get a better deal.