How Much Can I Expect to Pay for Utilities on the Big Island?
When I tour around the Big Island with buyers, it’s one of the questions I hear often: How much can I expect to pay for utilities? In general, I answer that they are reasonable and somewhat typical… except for electric. Here are some details about the household services that we want and need.
Let’s get the highest cost service out of the way. For most people, the electric bill is the most shocking (pun intended!). “Hawaii has the highest residential electricity prices in the United States, averaging 27.5 cents per kilowatt hour (kWh) in 2016—more than twice the national average,” according to a new analysis from the U.S. Energy Information Administration. The average for U.S. households in 2016 was 12.5 cents.
To combat the higher costs, many people generate their own power with photovoltaic (PV) systems and heat their water with solar panels. When looking to purchase a home in Hawaii, it’s important to know if the home is equipped with alternative energy sources and the terms of those sources. Is the PV system leased or owned? Is there a net metering agreement in place? Currently on the Big Island, new systems can be added, but the electric utility company (HELCO) is not purchasing electricity from new systems. Homeowners must store on site any extra electricity they produce.
Natural gas does not exist as a natural resource on the Big Island, so gas appliances require liquid propane. For homes that have a gas cooktop, gas dryer or gas pool heater, most receive their fuel from portable and stationary tanks, located on the exterior of the home. Propane is readily accessible, and there are companies who provide delivery service if you choose not to remove and fill the (portable) tanks yourself.
Because propane is a petroleum-derived product, the cost of propane fluctuates depending on the price of oil. The current price of propane in the Kailua-Kona area, delivered to your home in a rented 100-pound cylinder from Hawai’i Gas, is $6.32 per gallon.
Water for Big Island homes is provided by the County (Department of Water Supply), private well companies (e.g., Hawaii Water Service), private wells and catchment tanks. Current County rates are approximately $4.55 per thousand gallons and include all associated charges (consumption, power cost, standby, etc.). Check out the County’s water rates brochure here.
If your property is not serviced by the County or by a private well system, you will need a catchment tank. For more information about catching water from the sky, you may find helpful information at www.hawaiirain.org.
There are a variety of providers for your entertainment and communication needs, including Spectrum, Hawaiian Telcom, DirecTV, and Dish TV… as well as AT&T, Verizon, and Sprint. Even in remote areas where wired infrastructure doesn’t exist, high speed internet is available via satellite. In my experience, I’ve had very good connection with all services… as stable as the ones I had when I lived on the mainland. Regarding pricing: Because many of the providers are nationwide companies, their pricing structures are similar to other areas of the country.
Bonus Topic: Air Conditioning & Insulation
It’s surprising to many of my buyers that most houses (and several condominiums) do not have air conditioning. And if they do, it’s rarely in the form of a central system with ductwork. Many use mini split systems, defined by Trane (a manufacturer of AC systems) as “an indoor section and matching outdoor section (that) are connected by refrigerant tubing (hence the name “split”). The indoor section consists of a fan, indoor cooling coil, heating section, and filter while the outdoor section houses the compressor and condenser.”
Properties without air conditioning rely on good architectural design (e.g., ventilation & extended overhangs) and site placement to maximize the ocean to mountain (day) and mountain to ocean (evening) breezes that are common on the islands. And for properties that are located at higher elevations, an air conditioning system is not needed due to the cooler temperatures, which are approximately 3 to 5 degrees cooler per 1,000 feet of elevation gain.
In addition to the absence of air conditioning, many homes are also not insulated. When your windows are open 24/7 and you don’t have a cooling system, there’s no need for insulation!
The cost and availability of utilities are a consideration wherever you purchase a home in the U.S. For my household in Hawaii, when we total all of our utility costs, I estimate that we pay a little less than we did when we lived in Iowa where we ran the A/C in the summer and the furnace all winter. If you have questions about utilities in Hawaii, let me know. I’ll do my best to point you in the right direction.