Electricity and gas price per kWh costs explained

When looking at your energy bills, you’ll notice that suppliers will quote prices as gas cost per kWh or electricity cost per kWh.

This article will explain what this means, and give some context as to what these units actually mean in reality so you can better understand how your bills calculated.

In addition, if you have this information and give it to Lumo when trying to switch your supplier, we’ll have a more accurate understanding of how much energy you use so we can switch you on to the most suitable plan.

What is a kWh and kW?

A kWh is translated as a “kilowatt-hour”, which is a term to describe a unit of energy used by a customer. This unit of energy equals 1000 watts, or 1 kW.

A kW, or “kilowatt”, indicates the rate at which an appliance uses energy. Common electrical appliances will display this energy rating to indicate how much power it requires run. So if you have an appliance that needs 1000 watts (or 1 kW) to run, and you use it for 1 hour, then it’s 1 hour of use would equal to 1 unit of energy consumption.

All energy suppliers use the kWh unit to help calculate the cost of your energy. For example if your kWh rate that you’ve agreed with your supplier for electricity is 10p, then every unit of electricity that you use will cost you 10p. Using the above appliance for 1 hour will essentially cost you 10p.

This knowledge is very useful when shopping around for appliances or lightbulbs for example. Compare the kW or watts needed to run the appliance next time you’re shopping. An appliance that displays a lower kW or watts means that it needs less energy to run, which will translate into lower energy costs for you!

What common appliances take up 1 kWh?


  • Running a dishwasher for about an hour
  • Cooking in an over for about half an hour
  • Using an electric blanket all night


How many kWhs does the average household use per year?

Every household is of course different, but users can broadly fall into 3 different group types (low, medium and high).

An average low user tends to use 2,000 kWh of electricity, and 8,000 kWh of gas per year. This tends to be a home of 1 or 2 people who are usually out during the day, and tend to use energy mostly in the early mornings and evenings.

An average medium user tends to use 4,600 kWh of electricity, and 12,500 kWh of gas per year. This tends to be a home of 2-3 bedrooms with a small family.

An average high user tends to use 3,100 kWh of electricity, and 18,000 kWh of gas. This tends to be a home of 4-5 bedrooms with a family that tends to be using energy throughout the entire day.