Electric Deregulation
  • By ChooseEnergy.com
  • In Blog
  • Posted October 8, 2014

What does Electricity Deregulation mean?

This is a guest post by our affiliate partner Choose Energy.

It used to be that when it came to utilities, there was only one or two companies that monopolized power. You were stuck having to deal with companies that charged high prices for their services and products.

Today, many states’ utilities have been deregulated, so you have the power to choose which company you want to service your home. If you live in one of the 15 states where energy is deregulated, you may have the opportunity to save upwards of 20% on your monthly electricity bill by switching energy providers.

Switching energy providers is new and still foreign to many, and can be confusing. When selecting an energy provider, you should evaluate them based on the following four criteria:


Suppliers compete on price, and switching to a different supplier will mean that you can pay less for the same exact electricity. There’s no difference in quality, and the lights won’t flicker.

Plan Length

Another way suppliers vary is by the length of the plan. Because prices are always fluctuating on the open market, you have the option to lock in a long term plan, or a short term plan.

Long term plans are generally more conservative. For a longer time, you’ll be paying the same amount, but means you could miss out on potential savings if the market prices drop.

Short term plans are more adventurous. This gives you more flexibility, and the opportunity to shop for electricity more often. With a shorter term plan, you could be a position to take advantage of lower rates, if the market price falls. Additionally, you might end up with a slightly more expensive plan if the market rates jump up.

Supplier Brand

There are plenty of energy suppliers out there, and it can be hard to understand who’s reputable and who’s not. By reviewing suppliers’ reputations, and shopping from reputable locations, you can avoid paying too much from deceptive energy plans.

Renewable Percentage

Renewable energy is calculated through Renewable Energy Certificates, or RECs, which are purchased to match your energy usage. By choosing a 100% green plan, the supplier will purchase as many of these certificates as needed to match your annual electricity usage. By choosing a 25% renewable plan, then the supplier will purchase enough RECs to cover 25% of your electricity usage.

These RECs fund renewable energy projects ensure that clean energy is going on the grid. Likewise, because more clean energy is going on the grid, that means less coal and nuclear energy is populating the electricity grid.

By choosing a green plan, you can help fund clean energy and help remove energy sources with high carbon emissions.

For more information or for any additional questions, go to ChooseEnergy.com

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