You may have heard you’ve been given the power to choose your electricity provider. Many factors determine not only how to shop for a provider, but how to choose the one that best fits your needs. This article will detail those factors and provide you with an overview of how to shop for a new electricity provider.
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Shopping for an Electricity Provider
Choosing your energy supplier is a great way to take control of the cost of your electricity per kilowatt-hour. However, you must have as much information as possible to make an informed decision, especially if it’s your first time going through the process. Many states have a variety of electricity providers, with each one offering different plans and services. To get the best possible result, it’s necessary to research providers and gather as much information as possible.
When doing research, the best place to start is your state’s public utility commission (PUC) website. It’s part of the PUC’s duty to provide oversight for the competitive retail energy markets, prevent discriminatory or anti-competitive practices, and regulate essential utility services for electricity and natural gas.
If you live in a deregulated energy market, your state may have a website dedicated to the energy choice program. This website will allow you to compare rates and find more information about different electricity suppliers.
You can also search for information about individual energy providers online. Check their websites for their terms and conditions, as well as any other pertinent information. You can also look up reviews of the companies or ratings with the Better Business Bureau.
When looking into an electricity provider, be sure to observe qualities such as:
- How long they’ve been in business
- Customer satisfaction with their service
- How well they respond to inquiries
- Licensing and certification in your state
What to Look for in an Electricity Plan
The most significant reason to switch providers is to find an electricity plan that suits your needs. An electricity plan is a contract between you and the electricity supplier to provide your home or business with power. These contracts have many details that should be available on the electricity supplier’s website or by inquiry.
Here are some key things to look for:
Your new electricity plan should offer a reasonable, budget-friendly rate. In most states, this amount is the cost of your energy supply. In Texas, the rate is calculated from an average price, including energy generation and transmission costs. You can check your electric bill for your current rate to have something to compare with any offers you may see.
When looking at the rate, be sure to check whether it’s a variable or fixed rate. Fixed-rate plans remain the same throughout your contract, giving you a consistent price for the generation of your electricity. Variable-rate plans, on the other hand, fluctuate with the energy market. The amount of this fluctuation varies from plan to plan.
The length of your contract is another important detail to research and discover. Some contracts are month-to-month, while others last for a specified period. You should also ensure that the terms of the contract, including your rate, don’t change upon renewal.
If you decide to switch providers again after a length of time, you should also check whether your electricity plan has an early termination fee. If it does, find out the length of time you’ll be locked into your plan before the fee no longer applies.
Some electricity plans offer options for renewable energy. This electricity may only be a percentage of your supply, or the plan may be for 100 percent green energy. Ask about any eco-friendly options and their cost according to the new energy plan.
Finally, look into whether the new plan offers any incentives for switching. While not every company can give you an amazing rate, they may make up for it with rebates for energy efficiency, reward programs, or the free installation of a smart thermostat.
What to Avoid
With so many energy suppliers in a competitive market, a few may operate questionably. Some companies may even attempt to scam consumers with false promises or bait-and-switch tactics. However, there are things to watch out for when shopping around that will help you avoid falling victim to deceptive business practices.
Beware of any company that offers an unbelievably low rate per kilowatt-hour, especially as an “introductory” rate. The company may only apply this rate to your bill for the first month or quarter of service before raising it to an amount higher than what you were paying before you made the switch. Like the cost of many things, if an electricity rate seems too good to be true, there is probably a reason.
You should also be cautious of any company that uses high-pressure sales tactics. Some competitive suppliers will send representatives door to door to encourage people to sign up. If one comes to your door, don’t let them pressure you into switching without doing your research independent of what the company tells you. Instead, ask them for a website name and any information they can leave with you.
Frequently Asked Questions
No, participating in the energy choice program is optional. You don’t have to sign up with a new electricity supplier, especially if you are already happy with your current rate and service.
Your electric service is composed of generation, transmission, and distribution. The generation is the creation of energy, the transmission is the movement of that energy to stations owned by your local utility company, and distribution consists of the delivery of that energy to your home. Only the generation and transmission of your electricity will be affected by energy choice. Your local utility company will continue to maintain the distribution.
The Final Word
While deregulation has many benefits, it may be challenging to know where to start in shopping for a new electricity provider. However, by doing the proper research, you can discover precisely what electricity providers can offer you and avoid any pitfalls. Whether you’re seeking a new provider of electricity or natural gas, you should learn as much as possible to make the best decision for your energy bills and your budget.
Main Photo by: rawpixel
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