Can someone explain when to use less or lower. For example...

X costs less than Y

The costs were lower than expected...

Having trouble understand when to use what.

Part of what makes the distinction tricky in your examples is that the word "costs" changes its role.

In "X costs less than Y" less is an adverb, modifying the VERB costs.

In "The costs were lower than expected" lower is an adjective, modifying the NOUN costs.

It's not correct, however, that less only acts as an adverb. It can also be an adjective as in "I have less time this week to study." It may also act as a noun as in "He gave me less."

Lower can also be an adverb as in "He should aim lower next time."

Generally speaking, one way to think about it is that "less" is appropriate when "more" would also be appropriate. Similarly, "lower" is appropriate when "higher" is appropriate. We wouldn't say "This suit costs higher than that one," we'd say "This suit costs more than that one." So from that we can deduce that "This suit costs less than that one" is correct.

Rey