How to Read an Electricity Bill: Energy Charge, Distribution Charge and Taxes

An electricity bill carries a single total, but at least four different items hide inside it. Telling them apart helps you understand your bill and compare supplier offers correctly.

1. Energy charge

The kWh you consume multiplied by the supplier's unit price. It is the only item that changes with your choice of supplier. On the bill it appears as "Energy Charge" or "Active Energy".

2. Distribution charge

The fee paid to the distribution company for use of the grid. It is set by the regulator and is the same for all suppliers in your region. For residential customers it is calculated on a flat unit price rather than in tiers.

3. Taxes, funds and levies

Items such as the municipal consumption tax and the energy fund are calculated on the sum of the energy and distribution charges. Rates differ by customer group; the municipal consumption tax rate is lower for industrial customers.

4. VAT

Twenty percent VAT is calculated on the total of the three items above.

Worked example

For a home using 350 kWh with an energy charge of 3.18 TRY, the bill is built like this: - Energy charge: 350 × 3.18 = 1,113.00 TRY - Distribution charge: 350 × 0.92 = 322.00 TRY - Taxes and funds (about 6%): 86.10 TRY - VAT (20%): 304.22 TRY - Total: 1,825.32 TRY

As you can see, the energy charge is about half of the total. So a 10 percent discount on the energy charge reduces the bill total by roughly 7 - 8 percent.

What to check on your bill

• Period consumption: compare with the previous period. A sudden rise may be a meter reading error or a faulty appliance.
• Reactive energy: if a reactive energy charge appears at a workplace, the compensation panel may need maintenance.
• Multi-time tariff: if day, peak and night prices differ, shifting consumption to cheaper hours is possible.

This example is for information only; the current distribution charge and tax rates appear on your bill.

How do you tell whether you can save?

Find the energy charge (TRY/kWh) on your bill and put it next to our tariffs. Multiply the difference per kWh by your monthly consumption. Because the distribution charge, taxes and VAT do not change, this difference is the basis of your real saving; remember to add VAT. Our calculator does these steps for you and says honestly when there is no difference.