Cost to Build a House: How much does it cost to bring electricity to the land you're going to build on?

Building a new house on your own land brings many challenges you don't face if you build in a subdivision. Of course, one of the main advantages of being on your land is that you're not 10 feet from your neighbor. But, that also means the electric company might not have had a need to provide electricity to your land before, so you'll have to arrange, and pay for, that privilege.

So the question is, how do you get the electric service run to your property, and how much will it cost? Here's the guide on how to figure it out.

First thing to understand: every electric utility company seems to have a different policy and procedure, and you might have to do some digging to even find out which company you'll be dealing with.

Who is my electric company?

What a weird question, right? Well, we are currently in the drywall phase of building a particular home for a family in central Oklahoma, and the client had been researching the answer to that question for her property for a couple of months before we began building, and the two electric companies it could have been have been arguing back and forth about who will serve the house since the client first asked the question.

To figure out who your electric company will be, start by asking land owners in the general area who they send their check to. If that fails, look at the utility poles nearest your property, usually the ones at road intersections, and see if there's a little placard that has an electric company name on it. 

There's also a website you can use that might get you started called In My Area.

The main thing is to start by calling whichever one you find that's the most likely candidate. Call and ask about your specific piece of land, and they'll be able to tell you whether they serve it or whether it might be another company, which they'll direct you to.

How much will it cost?

This is really the main question, once you know who you're dealing with. The cost will vary according to lots of factors, but the main one is the electric company's policies. Here are the variables we typically hear:

  • Distance from the nearest power pole to the house location - the greater the distance, the more wire, trenching, etc., the greater the cost.
  • Whether or not they have to install a new transformer (the big can-like device on the pole that converts the voltage from a higher transmission line voltage down to the 240 volts that feeds your house).
  • How many new poles they'll have to set, how much wire they'll have to run, and / or how long of a trench they'll have to dig. 
  • How much vegetation they'll have to clear.
  • Whether the power will come to your house from overhead or underground wires.

The electric company might provide a certain amount (distance) of wire and trenching and you only have to pay for any additional amount beyond that. It varies from company to company. 

When it's all said and done, we've seen costs of the installation of new electric service cost anywhere from free, to a few hundred dollars, to several thousand dollars.

How does the process of running new electric service work?

There's more to getting new electric service installed than simply writing a check. There are some logistical issues that become more complex the further in the country you are, and the weirder the electric company's bureaucracy is. OK, it really is more dependent on the bureaucracy...

  • They'll send out an "engineer" to look at the property and figure out how they'll run the new power lines. The engineer will specify the path the new lines will take, along with whatever requirements the electric company has for clearance between trees and so forth.
  • The engineer will tell you what trees and whatever else needs to be cleared out of the way.
  • You'll establish a "contract for service", basically your promise to them that you'll be buying electricity.
  • Most of the time, the electric company will require you to put in the foundation and slab before they'll do any work to bring electricity to the site. That might seem unreasonable, but they've been burned many times before by people saying they're going to build and buy electricity every month, and after the electric company spends a bunch of money to string the new wires, the person doesn't ever build and never buys any electricity.

What to watch out for

When you meet the engineer that represents the electric company, make sure you get the person's name and phone number. Get him or her to write down what you talk about and what the electric company responsibilities are and what yours are. The reason for that is because we've seen our clients do everything the electric company engineer said was required, only to be told later something different was required, wasting the client's time and money.

Sometimes the electric company will hire outside contractors to do the clearing for the new lines, but there will be mis-communication between the two. You can help by over-communicating - follow up regularly with the electric company and with the contractor (you'll have to get the name and contact info. The electric company won't volunteer it, but won't withhold it once you ask.)

Before the electric company will install the actual electric meter, the city (or county) might have to inspect the installation of the wiring and temporary pole. The city / county is supposed to then send a record of the passed inspection to the electric company so they can set the meter. That process is hit-or-miss. If you follow up regularly with the electric company, ask them each time you talk whether the city has sent over the inspection results. Sometimes the electric company will say they haven't received it even if the city says they sent it. It will take patience and lots of insistent follow-up to get that straightened out.

Conclusion

That's about it. The main things to remember are that each electric company has different policies and procedures, and that each one has some kind of bureaucracy you'll have to navigate. Same with the city / county government.

If there's anything we can do to help you through this process, please reach out with a call or email and we'll be glad to help in any way we can. For more on the cost to build and how to budget, check out some of our other articles.

In the meantime, if you'd like to learn more about the overall process of turning your land into your forever home, download our free guide here:

Download Guide to Build Your Forever Home

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