Posts Tagged Electricity Suppliers in PA

Electricity Suppliers in PA

Tuesday, March 15th, 2011 | Permalink


In Pennsylvania even though this state has their electric utilities deregulated if you do not choose an alternate electric company you will remain with the big brand monopoly electricity supplier in your area of PA.

There is nothing wrong with staying with the old line monopoly electric utility but by shopping around you can usually save a considerable percentage.

Not all deregulated electricity states in the US offer significant savings on an electric bill when choosing an alternate electric supplier but in PA the savings is substantial.

A very large percentage of homes and businesses have shopped, compared and chosen to go with an electricity supplier in PA other than Penelec, PECO, Allegheny Electric and other large energy brands that were the states natural electric utility monopolies.

If you choose not to shop and compare electric rates, energy suppliers like PECO Energy will continue to deliver the electricity, maintain the poles and wires, and provide the (default) electricity service to your home or business in PA.

Alternately if you do choose a competing electric company besides a natural monopoly like PECO Energy you would still be using PECO, Penn Power or Penelec in regards to pole and wire maintenance and electricity distribution (delivery). You see these companies will always own the poles and wires and so they pass through this portion of the electricity charges on your bill.

After switching to an alternate electric supplier in PA a company like PECO would have a line item on your new electricity suppliers bill that shows their portion of the total charges.

There will also be another part on the electric bill that shows the electric generation charges that your new retail electricity company is charging.

The reason the PA electricity generation choice and competition act was created way back in 1996 was to allow for alternate electric suppliers to come into PA and assist in lowering the electric generation prices that once only came from the monopoly electric utility.

See Below How Prices Have Indeed Come Down Since PA Electricity Deregulation

Beyond just lowering electricity prices in PA the electric choice program assists in facilitating energy providers in offering new products and services such as shorter and longer term fixed rates that do not fluctuate in price.

Some residential and commercial businesses in PA have signed up for such things as an 18 month fixed rate that is locked in at a certain price for an 18 month term.

Other residential homes have switched to an alternate PA electric company and have found 3 month fixed rates that previously were never available. A 3 month fixed rate allows a customer to try out a new PA electricity supplier for a short time while having a fixed non-fluctuating electric rate.

If a customer has no issues after 3 months on a short term fixed rate they very likely will call their new PA electric supplier back up and choose a longer fixed rate plan such as the most popular 12 month fixed price.

Although the PA electric deregulation act was created a long time ago the rate caps have just now expired which has caused those monopoly electric utilities to raise their prices.

The rate caps in PA assisted in helping businesses and homes in Pennsylvania avoid the wholesale electricity price run ups that occurred in 2008.

The reason PECO and other old line monopoly energy companies in PA now have higher prices than quite a few other alternate electric suppliers is due to them having bought energy over an 18 – 22 month period when market prices were extremely high.

PECO and other large monopoly electric utilities also had a built in risk premium to account for future load level uncertainties which made their prices uncompetitive to competitive energy suppliers now in Pennsylvania.

With an alternate electric supplier in PA their is no risk premium although these providers must still hedge their energy when offering a fixed rate. These new energy companies have bought energy while the market was offering cheap energy and the avoidance of paying a risk premium has allowed for substantial savings over familiar brands like PECO.

Choosing an alternate electric supplier in Pennsylvania may seem like an uncertainty but in reality many of the energy suppliers in PA have a national or international presence and are as established if not more so than some of the large monopoly energy companies you may have used for years.

If you are considering electric choice in PA but at this time are still with Penn Power, PECO, Penelec, Met-ED or Allegheny Power we hope this article has given you a basic understanding of how electric choice can help you save money.

State wide close to 1 million customers have switched to a competing electricity supplier in PA and much of this has to do with the significant drop in electricity prices since deregulation has opened up once rate caps expired.

If you have questions about our commercial business reverse auction process that can assist in getting competitive electric bids for your company please fill out our sign up form above. If you would like to compare or switch to an alternate PA electricity supplier for your home you may also use the sign form above or choose one of our featured providers.

Electricity Suppliers