kWh explained: how to understand the cost of electricity and gas

Energy bills consist of 2 parts: a per unit (kWh) cost and a daily standing charge. In this guide, we'll look at how to calculate the price of electricity and gas per kWh in the UK.

 Energy meter showing kWh

A kWh is the unit used to measure your electricity and gas usage. 1 kWh is the amount of energy used to run a 1,000-watt appliance for 1 hour. The more kWh you use, the higher your bills will be.

What’s the difference between a kW and a kWh?

A kW (kilowatt) is used to measure how much power an appliance uses at any time. 1 kW is equal to 1,000 watts, so if an appliance is rated at 500 watts, it means it uses 0.5 kW.

In contrast, a kWh (kilowatt hour) measures the amount of energy used over the period of an hour. For example, a 0.5 kW appliance uses 1 kWh of energy over a 2 hour period.

According to the energy price cap, 1 kWh of electricity costs between 27.79p and 29.73p. But this can vary depending on:

  • Where you live in the UK
  • What tariff you're on
  • Your energy supplier

From 1 April 2024, when the next price cap comes into effect, the price of 1 kWh could fall to between 23.36p and 25.72p.

Gas currently costs between 7.29p and 7.62p per kWh used. From 1 April, the price could fall to between 5.90p and 6.33p.

How much you pay for your energy depends on:

  • Your energy supplier: Different suppliers charge different amounts for energy. Usually this depends on how much they’ve paid for the electricity used to supply your home.
  • The tariff you’re on: Is it fixed-rate or variable? The latter is subject to Ofgem’s energy price cap.
  • When you consume your energy: Some tariffs, like Economy 7 and Economy 10, charge different rates for electricity at different times of day.
  • How you pay for your electricity: Those who pay by Direct Debit get a discount.
  • Where you live: Some parts of the country pay more for their electricity based on the costs of transporting it to their region.
  • Your meter: Prepayment meters tend to be more expensive than standard credit meters.

You’re also subject to a daily standing charge. This is added to your bill and varies depending on where you live. For example, the current electricity standing charge is 44.38p per day (in London) and 69.31p per day (North Wales and Mersey). It’s set to increase again in April as more operating costs are transferred from the unit price to the daily standing charge.

How is kWh calculated for gas and electricity?

To work out gas or electricity kWh, you multiply an appliance’s power rating by the amount of time that it’s running.

How do I calculate kW to kWh?

To convert kW to kWh use this calculation:

Power (kW) x Time running (hours) = kWh

Remember, 1 kW equals 1,000 watts, so a 200-watt appliance is rated at 0.2 kW. Similarly, an hour equals 60 minutes, so each 15-minute block is the equivalent of 0.25 hours.

Here are some examples of electricity calculations based on common appliances:

Usage  Power rating Time running  Energy consumed  (Power rating x Time running)
Use a fan heater
1 kW
1 hour
1 kWh
Boil the kettle
3 kW
6 minutes (0.1 hours)
0.3 kWh

According to Ofgem, the average UK household consumes 2,700 kWh of electricity and 11,500 kWh of gas every year. This is based on a 2-3-bedroom house containing 2-3 people. Based on the current energy price cap, it equates to around £965 for electricity and around £962 for gas. 

Yes, you can use your own household’s kWh to compare energy deals. By providing your kWh energy usage you’re shown more relevant tariffs based on your actual usage rather than an estimate. You should be able to find this information on your latest energy bill.

How do I switch energy suppliers on

Use our energy comparison tool and follow this step-by-step process:

  • Enter your postcode and address
  • Enter your current supplier's details if you need to, including your tariff and usage from a recent bill
  • Compare deals to find the best option for you
  • Click ‘Switch today’ next to the deal you want and follow the prompts

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