Two words that get mixed up
Almost every energy question on a homestead comes down to two numbers: power and energy.
- Power is how fast something uses electricity right now. It is measured in watts (W). A thousand watts is a kilowatt (kW).
- Energy is how much electricity is used over time. It is measured in watt-hours (Wh). A thousand watt-hours is a kilowatt-hour (kWh).
Think of water. Power is how wide the tap is open. Energy is how much water ends up in the bucket.
Watts times hours
To get energy, multiply power by time:
watts × hours = watt-hours
A 10 W LED bulb on for 5 hours uses 50 Wh. A 1,000 W kettle on for 3 minutes (0.05 hours) also uses 50 Wh. The kettle is a much bigger load, but it runs for a short time.
Text description
Two taps fill two identical buckets to the same level. On the left, the tap is open a little, a thin stream, standing for low power used for a long time: a 10 watt LED bulb on for 5 hours, which is 10 watts times 5 hours, or 50 watt-hours. On the right, the tap is wide open, a thick stream, standing for high power used for a short time: a 1,000 watt kettle for 3 minutes, which is 1,000 watts times 0.05 hours, also 50 watt-hours. A dashed line joins the two water levels, marked same energy, 50 watt-hours. The width of the stream is power, in watts. The water in the bucket is energy, in watt-hours.
Change the power and hours. Watch the daily and yearly energy.
300 Wh per day, which is 0.3 kWh.
Over a year: about 110 kWh, or 13 to 33 dollars at typical US grid prices.
Assumptions: Grid price range of $0.12 to $0.30 per kWh covers most US residential rates (EIA).
Why the difference matters off the grid
Power and energy size different parts of a system.
- Power decides how big your inverter must be: the box that turns battery power into household power. If you run the well pump, microwave and kettle at once, their watts add up.
- Energy decides how big your battery and solar array must be. They have to cover the watt-hours you use each day.
Text description
Two rows. Top row, power, in watts, meaning how fast electricity is used right now: a well pump, a microwave and a kettle running at the same time have watts that add up, and that total sets how big the inverter must be. Bottom row, energy, in watt-hours per day: the load list total, each load's watts times its hours, added up for the day, sets how big the battery and the solar array must be.
A system can have plenty of energy stored and still trip because too many big loads ran at once. It can also have a large inverter and run flat by morning.
Power or energy?
Is each number power or energy?
- An inverter is rated 3 kW continuous
- Your bill shows 640 kWh this month
- A microwave is rated 1,100 W
- A solar panel is rated 400 W
- A fridge label says 1.2 kWh per day
- A battery holds 10 kWh
Reading an electric bill
A US electric bill charges mostly for energy, in kWh. A typical bill has:
- Usage: the kWh used this billing period. US homes averaged about 900 kWh a month in 2022, with wide swings by state and season (EIA).
- Energy charge: the price per kWh. In most states, home electricity costs about $0.13 to $0.30 per kWh. A few states, such as California and Hawaii, cost more (EIA, 2026).
- Fixed charge: a monthly fee to stay connected, whatever you use.
Your old bills are one of the best tools you have. Twelve months of kWh shows your seasonal pattern before you size anything.
Where the numbers come from
You can find the power of most appliances on a label or nameplate, usually on the back or bottom. It may list watts, or volts and amps.
watts ≈ volts × amps
A label that says 120 V and 1.5 A means about 180 W. That is the maximum. Many appliances, like fridges, cycle on and off, so their daily energy is much less than watts × 24.
Check
A 60 W laptop charger runs 8 hours a day. A 1,500 W space heater runs 1 hour a day. Which uses more energy each day?
Summary
- Watts measure power: how fast. Watt-hours measure energy: how much.
- Watts × hours = watt-hours.
- Power sizes the inverter. Energy sizes the battery and solar array.
- Your past bills show your real kWh, month by month.
Next, you will list your own loads and find the few that decide everything.
Go deeper: amps, volts and why system voltage matters
For the same power, a higher voltage means fewer amps. Fewer amps let a system use thinner wire and lose less energy as heat. That is one reason larger battery banks run at 24 V or 48 V instead of 12 V. Wire sizing and overcurrent protection are electrical design work: they belong to a licensed electrician and the electrical code, not to this course.