Fixed Rate Plans vs. Variable Rate Plans
Fixed rate plans are the most common type of electricity plan due to their stability and low risk. Fixed rates will stay the same for a set period of time, usually 12 months or 24 months. The downside is that they don’t take into account seasonal changes in demand, so you could end up paying more than you need to if your home needs less energy during colder months but more power during warmer summertime days. However, fixed-rate plans are easy to budget with since the price never changes no matter what’s happening in the world or how much electricity is being used at any given moment.
Variable rate plans are newer on the market because they’re often cheaper than fixed-rate plans which is why they’re gaining in popularity. Variable-rate plans are based on the wholesale price of electricity which changes constantly due to market conditions or seasonal changes. They can be difficult to budget with since the prices change so often, but if you pay your energy bill every month then it won’t affect you that much.
Monthly vs. Yearly Energy Plan Contracts
When you’re looking for a new energy plan, it’s important to understand the different contract types. Most providers offer both monthly and yearly contracts, but which one is right for you?
Monthly contracts are just that–you sign up for a plan each month and your rates stay the same. This is a good option if you want more flexibility or if you’re not sure how long you’ll need electricity for.
Yearly contracts, on the other hand, lock in your rate for the entire year! This can be a good option if you’re comfortable with your current provider and want to avoid rate increases in the future. It’s also a great idea for budgeting purposes, since you’ll know exactly how much you’ll be paying each month.
Energy deregulation is the process of allowing energy consumers to choose their own energy supplier. This process was first introduced in 1978, and it has since been adopted by various states across the United States. There are a few benefits of energy deregulation that include: increased competition, more choices for consumers, and innovation in the energy market.
Consumer Benefits of Deregulation
The increased competition that comes with energy deregulation leads to lower prices for consumers. This is because providers have to compete with each other in order to win customers’ business. In a regulated market, the state government decides which provider customers can use, which often leads to higher prices.
More choices for consumers is another benefit of energy deregulation. Before deregulation, consumers only had one or two choices for their energy supplier, but now they have a range of options. In addition to traditional companies like the utility companies, providers who offer renewable energy are now available as well.
Innovation in the energy market is another benefit of energy deregulation. With more choices available to consumers and service providers forced to compete with each other, there’s been an increase in the production of energy-related technologies.