What Is Energy Choice?

    Hanging light bulbs with one lit

    How is that possible? 

    Energy deregulation is the reason that you can shop for an energy provider in the first place. It gives you the power to switch your electricity or natural gas supplier in states where energy deregulation has occurred.

    How did it used to work? 

    Prior to the 1990s and for more than a hundred years, the way people received their energy didn’t change. Each region only had one utility—one choice, and because it was a monopoly on a necessary resource, it was heavily regulated by the government.

    The power of deregulation

    Over time, individual states began to pursue lifting these regulations to allow private commerce into these monopolies. This energy deregulation effectively passes new laws and amendments to allow more than one company into the energy marketplace. Today more and more states are seeing the value of divesting these monopolies through energy deregulation.

    How does the utility fit into the equation? 

    Whether you live in a state that’s been deregulated or not, your energy is still delivered to your home and business using the utilities’ pipes and lines. And the utilities also have kept their control on the metering, billing, and emergency services.

    The power to choose 

    The remaining governmental regulations dictate that a utility can only offer consumers a variable rate, determined by the state’s Public Utilities Commission, for their energy. In other words, utilities can’t sell energy for a profit. Depending on your area, this Commission rate can change every few months or as often as every month. On the other hand, energy suppliers are not allowed to, which means they can offer fixed rates and different terms on your electricity and natural gas contracts than the utility can. In this way, utilities and suppliers work together to give consumers options. The utility is the delivery service, and the supplier is the expert energy purchaser.

    What does it mean to choose an energy supplier? 

    When you choose an energy supplier, there’s no complicated switching process. In fact, the process only takes a few minutes. With a supplier, you have access to a wide variety of product options and services to meet the needs of your home or office. 

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