You can calculate the cost of energy use for various electrical appliances and equipment if you have these three pieces of information:

• the rated power of the appliance, usually given in watts;
  
• the length of operating time,
  
• and the cost of electricity.

The rated power, in kilowatts, is multiplied by the operating hours to determine the energy use in kilowatt hours. The energy use is then multiplied by the electric rate to determine the cost of electricity to run the appliance.

For example, let's determine the cost to run a 1,500-watt heater for six hours based on an electricity cost of eight cents per kilowatt hour.

The power rating of the heater is 1,500 watts. To convert this to kilowatts, divide 1,500 watts by 1,000. This yields 1.5 kilowatts. Now multiply the power use, 1.5 kilowatts, by the operating time of 6 hours; which equals 9 kilowatt-hours of energy use. Finally, multiply the 9 kilowatt hours of energy use times the electric rate of eight cents per kilowatt-hour. You now know it costs 72 cents the operate the heater for 6 hours.

On larger appliances, like refrigerators and water heaters, there is a yellow label on the side which states how much energy costs to run the appliance for a year. If you look closely you can see that the manufacturer has used "averages," family size, hours per day, etc, to determine the annual operating costs for this appliance.

then:

Operating Cost ($) = Energy Use (kWh) x Electric Rate