The Benefits of Shopping for Cheaper Utility Companies

The Benefits of Shopping for Cheaper Utility Companies

  13 Aug 2018

Almost every property owner or renter would love to reduce their energy bills at the property they reside in. While there are many things people can do to cut costs with energy conservation, prices for utilities always seem too expensive with few real areas of savings. The good news is things have changed in the last few decades in certain areas of utilities. In fact, now in some states, residential customers have been able to find cheap electricity with no deposit because of changes in the utility marketplace.

Having electricity for a home or rental unit is a need for everyone. In years past, many areas of the country only gave customers one choice for their public utility electrical company. However, due to deregulation changes, consumers now have a greater variety of choices when they are seeking a source for their electrical company for residential and commercial use.

Understanding Utility Deregulation

Deregulation is a process by which the government makes companies that are known to have a monopoly on a specific business or utility, change the way they do business. Deregulation forces conglomerates to share the industry with smaller or competitive companies. This is done to establish a more open free market approach which usually significantly benefits consumers.

While most Americans are familiar with deregulation of transportation and communications, fewer have been aware of the changes and trends in the energy sector as well. The Energy Policy Act of 1992 allowed for the other companies to be able to handle the distribution of wholesale electricity and natural gas to competitors. These second-tier companies then deliver it to their customers and manage their service. These changes allow consumers in states that have adapted the changes to shop around for an electricity or natural gas carrier with cheaper rates than the primary carrier in the state or region. While the primary electric company of a given area is still the source of the energy, the distribution and management of the electricity is now allowed to be managed by a host of different companies. This allows consumers a greater opportunity of choice for getting their basic electric services managed at a significantly lower rate.

The Energy Policy Act of 1992 was a federal policy that opened the deregulation process in all 50 states. However, not all fifty states have enacted these changes or completed the process for these changes in utility service. Only the states that have completed the deregulation process have multiple companies that offer service of electrical or natural gas supply. Presently, as of 2018 there are eighteen states that have a deregulated electricity market. There are another six states that are in the process of deregulation for electricity as well.

In addition, there are some states that offer deregulated public utility gas as well as electricity and others that offer only deregulated gas or electricity. There are an additional twelve states that have deregulated public utility gas services but not electric. Texas is one of the primary deregulated electric energy markets which affords excellent opportunities for electric customers to shop around for the best deal they can find.

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