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Residences are billed according to the energy consumed, expressed in kilowatt hours.

A 'tariff' is the pricing structure imposed by the supply utility. This varies from country to country and from company to company. For example, a tariff may consist of a particular price per kilowatt hour for the first specified number of kilowatt hours used, which then increases, or even decrease, for the next specified number of kilowatt hours used. There may be several levels of pricing based on the number of kilowatt hours consumed.

In addition to the basic cost per kilowatt hour, utilities might have to charge a fuel surcharge, based on the current price of gas, oil, or whatever other fuel is used to generate electricity. Further surcharges may then be added to cover the cost of 'green energy' initiatives, such as wind turbines.

On top of the basic cost and fuel surcharge, value added tax or a goods and services tax may be applied -again, depending on country.

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