Paying your electricity bills each month does not have to be a dreadful experience. Thanks to energy deregulation, residents in more than 15 US states are free to switch their electricity supplier for a better, more competitive price. Switching will not only save you money on your monthly bill but often comes with attractive benefits and rewards.
Thinking about changing electricity providers can be stressful if you don’t know how or whom to switch to. That’s why we are here to help. Read on to find out who is who in the energy world, what are the steps to follow when choosing an electricity plan and a list of trusted electricity suppliers.
What’s the difference between a supplier and a utility?
In the 1990s, the US federal government deregulated the energy industry, which gave customers like you the opportunity to choose the electricity and natural gas provider to supply your home or business. With more choice came competition and there are now a number of companies, competing for the attention of deregulated states customers with attractive energy offers and value add services.
Understanding the difference between an electric supplier and a utility can save you a lot of money in the family budget.
What is an electric supplier?
Electric supplier (or a provider, retailer) is a company that buys wholesale electricity from electricity generators and sell it at a retail level to the general public. Since the suppliers source the electricity or natural gas from a variety of plans, they can offer customers more competitive rates.
Each deregulated state’s public utility commission keep an up to date list of the licensed electric suppliers on their website, so you can rest assured that you are purchasing electricity from a reliable source. To compare the electricity and natural gas deals available in your area, all you need to do is enter your zip code in a trusted energy comparison website.
What is an electric utility?
An electric utility is responsible for the physical delivery of electricity to your home and the maintenance of the pipes and wires that carry the power flows. Your lights went out? They are the people you would call to fix your power if there is an outage or a problem.
You will also hear about them being referred to as TDU (Transmission & Distribution Utility) or TDSP (Transmission & Distribution Service Provider). You can find out who is your utility provider on your electric bill.
How do I choose an electricity supplier?
Now that you know who are electricity suppliers and what is their role in providing you with cheap reliable energy, your next thought might be – Okay, so how do I go about selecting one?
While the actual switching process is relatively easy, you shouldn’t rush the selection and instead shop around to ensure you are getting the best deal possible.
1. Know Your Energy Usage
The advertised electricity rates you will find on electric suppliers’ websites are almost always based on a specific energy usage and they vary, according to how much electricity do you use on a regular basis. The key to avoiding overpaying for electricity is having a good idea about how many kWh / month does your household or a business normally use.
The easiest way to find out how much power you use is to look at your electricity bill, but there are also various online tools to help you estimate it.
2. Understand The Available Options
Energy plans are like shoes. One size does not fit all. The electric suppliers offer many different energy plans and you should be familiar with each option’s pros and cons. However, navigating through complex unfamiliar information about power rates can be daunting, so we did the heavy lifting for you. Below is a brief overview of the most commonly offered energy products:
|Fixed Term Plans - This plan will lock the price you pay per kWh for the duration of the contract, no matter how much the wholesale electricity price varies. These plans are most often the cheaper option, but usually carry cancellation fees, if you decide to exit the contract early.|
|Variable Rate Plans - There is no locked in rate and the price you pay for a unit of electricity might be cheaper one month and more expensive the next month. The plus side is that there is no commitment to stick to it for a fixed period and you can switch anytime.|
|Green / renewable plans - If you are concerned about your carbon footprint, many electric suppliers offer you the choice of an energy plan, sourced entirely or partially from renewable energy, such as wind or solar. These plans can have either variable- or a fixed rate form.|
|Prepaid plans - This plan lets you pre-purchase power for your home at a set price, like a prepaid cell phone. This isn’t for the forgetful ones - if you don’t remember to top up your plan, you might find yourself without electricity half-way through a hot shower.|
3. Do Your Research
Or let us do it for you…Just like with any other company, you want to make sure that you are signing up with a reliable trustworthy supplier. We review a majority of the deregulated states’ electric suppliers and provide you, the customer, with everything you need to know before switching, including:
- The supplier’s service areas
- Overview of additional supplier’s benefits and value adds
- Your area’s electricity rates comparison
- Links to reliable customer reviews websites
- Any other useful information
With all the information in one place, you can just focus on getting the best rate for your home or business. Once you select an electricity supplier, you can sign up for the new plan directly on our website.
Our List of Preferred Electric Suppliers
|Ambit Energy||2006, TX|
|Amigo Energy||2003, TX|
|Bounce Energy||2008, TX|
|Champion Energy||2005, TX|
|Cirro Energy||2001, TX|
|Clearview Energy||2006, TX|
|Constellation Energy||1999, MD|
|Direct Energy||1986, TX|
|First Choice Power||2001, TX|
|Frontier Utilities||2008, TX|
|Gexa Energy||1985, TX|
|Hudson Energy||2002, NY|
|Just Energy||1997, Canada|
|Reliant Energy||2000, TX|
|Spark Energy||1999, TX|
|Tomorrow Energy||2001, TX|
|TriEagle Energy||2003, TX|
|Verde Energy||2009, CT|
|YEP Energy||2002, TX|
What else should I know?
Your Energy Usage
Your expected electricity usage is generally the most important thing to know, not only because it determines the rate you will be offered by an electric supplier. Some plans offer things like free nights or weekends, so knowing when you plan to use your power can help you find a deal more suitable to your needs.
There are often many considerations with an electricity plan that you won’t discover until you read the fine print in the contract details. Keep an eye out for hidden fees, such as high cancellation penalties, sign up fees and other.
Don’t be afraid to ask your supplier a question. Remember that the competition between electric suppliers in deregulated states is steep and the ultimate price is you. We provide contact details to each reviewed company’s customer service department, so if you have any questions, reach out to them.
Below are answers to a few burning questions you might have about electric suppliers.
Who is the cheapest energy supplier?
The price you will pay for electricity or natural gas will depend on your individual location and energy usage. To shop for the best rates in your area, enter your zip code to compare available suppliers and energy plans.
How do I change my electric supplier?
We provide all important contact information and links for switching suppliers in our electric company review posts. Most of the electric suppliers offer the option to sign up online, over the phone or via email.
How long does it take to switch energy supplier?
You should see an electric bill from your new supplier in one billing cycle. They will be responsible to notify your old supplier of the switching and they will agree on a switching date.
What happens if my energy supplier goes bust?
If your energy supplier goes bust, there will generally be a “safety net” in place which will automatically switch you to a new supplier to ensure that you don’t go without electricity.
How often should you switch energy supplier?
You can switch energy suppliers as often or as little as you want, but that doesn’t mean you always should. If you are locked in a fixed-term contract, you will likely have to pay a cancellation fee which would make switching impractical. If you are in a variable month-to-month contract, it may make sense to switch plans as soon as you can find a less expensive supplier.
What happens to your credit when you switch energy supplier?
Switching energy suppliers should not affect your credit. The main thing that negatively affects your credit is not paying your bills on time. If you keep up to date with your bills, then you should be fine in this regard.
Can an energy supplier refuse to switch?
An energy supplier can refuse to let you switch under certain conditions and regulations and guidelines vary depending on where you live. Typically, energy suppliers can refuse to switch if your account has been overdue over a certain period of time.
When it comes to energy, you as the customer have the power of choice. By shopping around for the best electricity or natural gas deal, you can not only save money in your family or business budget but can also enjoy various value add services and innovative solutions. The switching process is easy and you will almost always find a plan that is better than the default one.
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