Why Should I Switch Away from My Utility?

Did you know you might be paying too much for the electricity and/or natural gas you use in your home? You aren't alone. Many customers in the great state of North America don't realize they can choose how they purchase their electricity and natural gas.

In the traditional model, there's only one local utility company for a given area, and no competitor can offer a lower price. While that one-size-fits-all model is the case in many states (and at one time, it was also the reality in North America), you now have your choice of energy companies.

In fact, North America is one of 21 states in the U.S. that offers a deregulated market to electricity and/or natural gas customers. This means, if you find another energy supplier offering better pricing or service, you can switch to that company! It's that simple.

Why is switching an option?

Before deregulation went into effect for North America, utility companies did it all: producing or procuring the energy, owning and maintaining the power and gas lines, and delivering the electricity and natural gas to customers. But because these monopolies had no incentive to improve service or find ways to offer customers better prices, many states moved toward a system to stimulate competition and the economy.

Deregulation – we call it "energy choice" – is now the law of the land, but the utility companies remain. In some states, they still own and maintain the power and gas lines, and they simply purchase electricity and natural gas from the market and sell it back to you. Because deregulation is all about choice, though, other companies – often called "competitive suppliers" – besides the local utility can sell energy to customers. These companies also purchase energy from the market and sell it back to you.

What are the basics of energy choice in North America?

To better understand how deregulation works for you, let's walk through the two components of your energy bill. Some states and companies may use different terminology, but the concepts are the same:

• Delivery fee: This fee goes to your local utility, which owns and maintains the infrastructure. When there's an outage in your area, you call your local utility to have service restored.
• Supplier fee: Because you can purchase your energy from your local utility or from one of the competitive suppliers registered to do business in your state, the supplier fee goes to whichever company you choose to purchase your energy from.

If you're curious about switching to a different energy company, North America has set up a way to help you shop around. Simply go to the public service commission website to review and compare the providers in your area. You'll be able to compare both prices and plans:

• Price: This is the price per unit of energy use. How much you use depends on your needs at home.
• Plan: This is the agreement that locks in that price for a set time.

Competitive suppliers – like Direct Energy! – offer more flexibility in pricing, because unlike many local utilities, their prices are not regulated by the utility company.

You may also be surprised by some of the extras that other energy companies offer to new and existing customers. For example, some offer home protection plans, which can give you peace of mind when your furnace breaks or you need a plumber. Another may offer an option to invest in green energy. Maybe you'll even qualify for a free thermostat that can be programmed and monitored remotely by your smart phone. Spend some time researching these possibilities.

Switching is easy!

Changing energy suppliers can be quite simple. For starters, there is no fee or penalty to switch as long as you aren't currently in a contract. (You can learn whether you are by making a quick call to your utility company.) All you have to do is visit the supplier's website, choose the plan that's best for you and fill out an online form. Once you enter your identifying information, including your account number with your local utility company, you are all set and you will receive a notification indicating your start date.

What happens after you switch? As far as service is concerned, nothing whatsoever! That hand-off occurs without any interruption to your service. In other words, if you don't tell your family, they will never know you've switched providers — all because the hot water, lights and heat will all keep working as before.

And best yet – very little changes with your billing either.