How to Reduce Your Electric Bill: The Biggest Savings, Ranked

Quick answer

Start with the biggest users: air conditioning, space heating, and water heating used about 44% of U.S. home electricity in 2020, according to the EIA. Among cheap moves, the DOE’s largest figures are for sealing air leaks (10% to 20% of heating and cooling bills), cutting standby power (which could add 5% to 10% to a bill), and a thermostat setback (up to 10% a year on heating and cooling). When an electric water heater wears out, a heat pump water heater saves the most: about $344 to $688 a year by ENERGY STAR’s figures at the July 2026 U.S. average of 18.31¢ per kWh.

Where your electricity goes

Each 100 kWh you cut saves $18.31 at the July 2026 U.S. average ($12.72 in Louisiana, $48.00 in Hawaii). The EIA’s 2020 Residential Energy Consumption Survey (RECS) shows where the kWh go, and how you heat your home changes the picture:

End use	All U.S. homes	Homes heated mainly by electricity	Homes heated mainly by natural gas
Air conditioning	19.4%	17.2%	22.2%
Space heating	12.4%	24.9%	2.9%
Water heating	12.0%	17.3%	5.0%
Refrigerators	7.9%	6.0%	9.7%
Everything else	48.3%	34.8%	60.2%
Average use per home	10,565 kWh a year	13,074 kWh a year	9,034 kWh a year

Includes electricity from rooftop solar. Shares may not add to 100% because of rounding. Source: EIA, 2020 Residential Energy Consumption Survey, Table CE4.1

With electric heat, heating is the largest slice. With gas heat it barely shows, so heating savings land mostly on the gas bill. Inside “everything else,” the largest items are lighting (6.2%), TVs and related devices (5.8%), furnace and air handler fans (4.7%), and clothes dryers (4.3%).

A pool pump is only 1.5% of U.S. home electricity, but a home that has one uses a lot:

Item	Average use a year	Cost a year at 18.31¢
Electric water heating	2,706 kWh	$495
Electric space heating	2,484 kWh	$455
Pool pump	2,384 kWh	$436
Electric vehicle charging	2,363 kWh	$433
Air conditioning	2,318 kWh	$424
Hot tub heater	1,479 kWh	$271
All refrigerators in the home	839 kWh	$154
Clothes dryer	680 kWh	$124
Lighting	654 kWh	$120
TVs and related devices	632 kWh	$116
Separate freezer	570 kWh	$104
Second refrigerator	494 kWh	$90

Converted from Btu at 3,412 Btu per kWh. Space heating includes homes that use electricity only for a secondary heater. Costs rounded to the dollar. Source: EIA 2020 RECS, Tables CE5.3a and CE5.3b; price from EIA Electric Power Monthly Table 5.6.A (U.S. residential, July 2026: 18.31¢/kWh)

Climate and household size matter too: air conditioning averaged about 4,173 kWh ($764) in hot-humid climates but 1,310 kWh ($240) in very cold and cold ones, and electric water heating 1,427 kWh ($261) for one person but 4,313 kWh ($790) for four.

The biggest savings, ranked

The dollar figures apply DOE and ENERGY STAR percentages to the averages above at 18.31¢ per kWh, sorted by the top of each estimate.

Change	Official figure	Savings a year	Type
Heat pump water heater instead of standard electric	ENERGY STAR: 1,880 to 3,760 kWh, 2 to 4 people	$344 to $688	At replacement
Heat pump instead of electric furnace or baseboard	DOE: about 50% less heating electricity	about $227	At replacement
Cut standby power	DOE: could add 5% to 10% to the bill	$99 to $198	Habit
Seal air leaks	DOE: 10% to 20% of heating and cooling	$88 to $176	Small project
Unplug an unneeded second fridge	EIA: 494 kWh average use	about $90	Habit
Thermostat setback, 7°F to 10°F for 8 hours	DOE: up to 10% of heating and cooling	up to $88	Habit
Insulate a warm water heater tank	DOE: 7% to 16% of water heating	$35 to $79	Small project
ENERGY STAR smart thermostat	ENERGY STAR: more than 8% of heating and cooling	about $50 (ENERGY STAR)	Purchase
LEDs in the five most-used fixtures	ENERGY STAR: about $40 a year	about $40 (ENERGY STAR)	Purchase
ENERGY STAR clothes dryer	DOE: about 20% less energy	about $25	At replacement
TV in “home” or “standard” mode	DOE: 18% to 30% less TV energy	$7 to $12	Habit

Heating and cooling rows assume the 2020 averages for both electric space heating and air conditioning: 4,802 kWh, or $879 a year. The heat pump row halves average electric space heating (2,484 kWh). The standby row uses the EIA's average of 899 kWh a month ($164.61). Source: DOE Energy Saver guide (2022), ENERGY STAR, EIA 2020 RECS; dollars at the EIA U.S. residential average for July 2026 (18.31¢/kWh)

1. Heating and cooling

Set the thermostat back. Turning it 7°F to 10°F lower for 8 hours a day in fall and winter (higher in summer) can save as much as 10% a year on heating and cooling, the DOE says. The winter thermostat settings guide covers schedules and when to skip a setback.

With a heat pump, avoid backup heat. The DOE warns against manual setbacks that turn on costlier backup electric resistance heat; use a thermostat designed for heat pumps. See aux heat vs. emergency heat.

Seal air leaks, among a home’s greatest sources of energy loss (DOE). Weatherstrip doors and windows, and caulk gaps where plumbing or ducts pass through walls, floors, and ceilings. For air sealing plus attic and floor insulation, ENERGY STAR estimates an average of 15% off heating and cooling costs: 16% to 20% in northern climate zones, 7% to 14% in southern ones.

Have leaky ducts fixed by a pro. Ducts leaking into an attic or crawl space can add hundreds of dollars a year to heating and cooling bills, the DOE says. Hire a qualified professional, and have duct sealing tested for combustion safety and airflow.

Maintain the basics. Clean or replace furnace, heat pump, and AC filters monthly or as the maker recommends, and leave the thermostat fan on “Auto” unless an indoor air quality pro set it otherwise (DOE). Keep registers clear of furniture (ENERGY STAR).

Use fans and shades. A ceiling fan lets you set the thermostat about 4°F higher in summer with no loss in comfort, the DOE says. Turn it off when you leave the room, and close window coverings on hot days.

Replacing electric resistance heat? A heat pump can cut heating electricity by about 50% compared with an electric furnace or baseboard heaters (DOE). With gas heat, see heat pump vs. gas furnace cost. If your heat pump is iced over or not heating, fix that first.

2. Water heating

• 120°F is enough for most homes. The DOE calls it safe for most of the population. Rheem’s manual says its thermostats leave the factory at 120°F, that lower settings save more energy, and that homes with small children, older adults, or people with disabilities may need 120°F or lower to prevent scalds.
• Wash in cold water. Heating water takes about 90% of the energy a washer uses (ENERGY STAR). Warm instead of hot cuts a load’s energy in half, and cold saves more (DOE).
• Insulate. If the tank is warm to the touch, insulating it can save 7% to 16% a year on water heating (DOE); follow the maker’s recommendations. Insulating hot water pipes saves another 3% to 4%.

When the tank wears out, consider a heat pump water heater. Certified models use 70% less electricity than standard electric ones (DOE, citing ENERGY STAR). ENERGY STAR estimates yearly savings of 1,880 to 3,760 kWh for households of 2 to 4 people, which it priced at 14.6¢ per kWh ($270 to $550). At 18.31¢, that is about $344 to $688. The unit needs an indoor space that stays between 40°F and 90°F with about 1,000 cubic feet of air, ENERGY STAR says, so plan before the old tank fails. No hot water now? See electric water heater not heating.

3. Refrigerators and freezers

The easy win is a fridge you don’t need: an average second fridge used 494 kWh (about $90 a year now) and a separate freezer 570 kWh (about $104). The DOE suggests recycling an old one, especially if it holds little or sits in an unconditioned space, and notes many utilities offer recycling rebates. On older models, keep the condenser coils clean, as the DOE suggests. For settings and garage fridges, see how much electricity a refrigerator uses.

4. Lighting, TVs, and standby power

• LEDs. Certified LED bulbs use up to 90% less energy and last 15 times longer than standard bulbs, according to ENERGY STAR. Most homes already use some (90% in the EIA’s 2024 survey), so check your most-used fixtures for older bulbs.
• TVs. “Home” or “standard” picture mode cuts a TV’s energy use by 18% to 30%, the DOE says, and streaming through a game console uses 10 times more power than through a tablet or laptop.
• Standby power. An advanced power strip, or a regular strip used as one off switch, stops the power many electronics draw while off. The vampire power guide shows which devices draw the most.

5. Laundry and dishes

• Dryer. The DOE suggests lower heat even if the cycle runs longer, drying towels apart from lighter clothes, and a high-speed or extended washer spin first. Use the moisture sensor and clean the lint trap before every load (ENERGY STAR); many dryer fires come from not cleaning the dryer, the DOE adds. If clothes stay damp, see dryer not heating or washer not spinning.
• Dishwasher. Scrape instead of rinsing, run full loads, and use air-dry, ENERGY STAR suggests. If loads come out dirty, clean the filter.

6. Pool pumps, hot tubs, and electric vehicles

• Pool pump (about $436 a year). Running the filter 6 hours a day instead of 24 cuts its energy use by 75%, according to ENERGY STAR, and halving a pump’s speed lets it use about one-eighth the energy. Certified in-ground pumps use 20% less energy than standard ones.
• Hot tub (heater about $271, pumps about $89). For a spa used weekly, ENERGY STAR says lowering it 3 degrees between uses saves about 5% to 10% of heating costs. Keep the cover on.
• Electric vehicle (about $433). Time-based rates suit EV owners, who typically charge at night, the DOE notes.

Pay less per kWh: rate plans and suppliers

Time-of-use plans charge more at peak times and less off-peak (DOE). Demand usually peaks in the afternoon and early evening (EIA). Moving laundry, dishwashing, and EV charging off-peak can save money, but heavy peak use costs more. If you have a smart meter, check your hourly use in your utility’s portal before switching.

Choosing a supplier. Some states let you buy power from an alternate supplier, usually only if an investor-owned utility serves you. The utility still delivers it and charges for delivery (EIA). Your state utility commission can tell you if you have a choice.

Free help: energy audits, rebates, and bill assistance

Energy audit. A professional audit shows how much energy your home uses and which improvements to make first (DOE). Some utilities offer assessments, so ask yours.

Rebates. ENERGY STAR’s Rebate Finder searches offers by ZIP code for products like heat pump water heaters and pool pumps.

LIHEAP. This HHS program can help pay heating bills, prevent shutoffs, reconnect service, and make homes more efficient. It targets low-income households with high heating and cooling costs for their income, especially those with older adults, people with disabilities, or young children. To find your local office, call 1-866-674-6327, the National Energy Assistance Referral hotline (weekdays, 9 a.m. to 7 p.m. Eastern).

Weatherization Assistance Program. This DOE program makes low-income homes more efficient; households save $372 or more a year on average, the DOE says. Households at or below 200% of the federal poverty income guidelines, or receiving Supplemental Security Income, qualify under DOE rules; states may use LIHEAP’s 60% of state median income instead. Renters can apply with the landlord’s permission. Apply through your state weatherization agency, and expect a waitlist.

Lowering your electric bill in winter

• Use the sun. Open drapes on south-facing windows by day and close them at night (DOE).
• Reverse ceiling fans to run clockwise, which pushes warm air down (DOE).
• Cover or remove window air conditioners so heat doesn’t escape (ENERGY STAR).
• Before adding a space heater, see the space heater cost guide for when it saves money and how to use it safely.

Find your own biggest users

Enter any appliance’s watts below, or open the appliance cost calculator. More guides are in the electricity cost section.

How we calculated these numbers

• Price: EIA Electric Power Monthly Table 5.6.A, July 2026 (released September 24, 2026). These are statewide averages, not your plan’s rate.
• Use: EIA 2020 RECS Tables CE4.1, CE5.1a, and CE5.1b (shares) and CE5.3a and CE5.3b (averages for homes that have each item), converted at 3,412 Btu per kWh. These are the latest end-use figures; full 2024 survey data is due in spring 2027.
• Dollars: kWh × $0.1831, rounded to the dollar. DOE and ENERGY STAR percentages are applied to the matching 2020 average; the standby example uses the EIA’s 899 kWh a month per residential customer (2022).
• Updates: we recalculate when the EIA publishes new monthly prices.