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Overview and Definition of Utility Bills

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Quick Answer

A utility bill is a document that requests payment to be sent to companies located within a local jurisdiction. These bills require payment for a public service rendered to and received by a household's occupants.

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Overview and Definition of Utility Bills
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Full Answer

Local service providers offer public services for residents of a community. The community might be a city or a town, depending on the population and geographic size. Common public services include telephone, electricity, gas, sewer and water. These are utilities that generally include the services required to operate a home or business. Utility bills are usually generated monthly.

Setting Up Utility Service

Many communities require customers to apply for utility service in a similar way to applying for credit, advises the United States Federal Trade Commission. Utility companies will check potential customers' credit history prior to approving utility service. Someone with poor credit may have to pay a higher deposit to begin utility service, or they may need to have someone else sign up for an account and act as a guarantor for payment.

Monthly Fluctuations

The number of utility bills varies for different services and companies. These bills and their owed amounts are based on how much of each utility customers use. Seasonal fluctuations often occur with utility bills based on the services required. For example, electric bills tend to be higher during the summer months when households and businesses are using electricity for air conditioning. During the winter months, customers in cold climates will have higher gas bills to power their furnaces. Households may also notice higher or lower water bills at different times of the year if water usage goes up and down seasonally, such as when plants need more water in summer.

Managing Utility Costs

After setting up utility service, using the service will incur charges, which will generate monthly bills. Many customers search for ways to lower utility bills to make service more affordable. Raising the indoor temperature of a household during the summer can cause the air conditioner to run less often, which can help lower electric bills. Lowering the indoor temperature in the winter uses less gas to run the furnace. Some utility companies also offer budget plans designed to help consumers afford services. With a budget plan, customers typically pay a flat monthly fee for utility services. If usage exceeds the flat fee, the provider may require the customer to pay the additional amount.

A home energy audit is another way to lower utility bills, according to the U.S. Department of Energy's Office of Energy Efficiency & Renewable Energy. With a home energy audit, an auditor assesses a house to find problems with air leakage, inadequate insulation and excessive energy consumption. The results of the audit will show consumers improvements they can make to a home to use less electricity. These tasks may include replacing windows, adding insulation and updating appliances. An auditor may also suggest other ways consumers can reduce the amount of energy they use, such as installing a programmable thermostat.

Getting Assistance

Paying utility bills in a timely manner is important to maintain good credit and to continue services without interruption. Utility companies may offer assistance to customers who experience trouble paying utility bills. Customers must contact the companies proactively to resolve billing issues and avoid interruption of services.

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