After the deregulation of energy companies in the 1990s, electricity providers began competing for customers. Seemingly overnight, home- and business owners were introduced to a range of electricity supply choices at better-than-ever prices.
When most people begin shopping for an electricity provider, the economic factors are the first that come to mind. After all, every homeowner wants to save money, but there are other considerations, such as your provider’s dependence on non-renewable resources, that may affect your decision.
Read on to learn four tips for choosing the best electricity provider for your needs:
1. Do not choose a company based only on its years in the industry.
Several new electricity companies are competing with established providers by offering exceptional customer service or lower prices. Most companies share similar power-transmission systems, which a third party maintains. As a result, the quality of the service does not depend on how long the company has been in the industry.
2. Find the best deals.
Look for promotional deals and discounts. A difference of just $0.01 per kilowatt-hour of electricity could mean hundreds of dollars in savings every year. For example, if you pay $0.09 per kWh rather than $0.12, that could add up to more than $100 dollars per month depending on your consumption.
3. Keep an eye on changes within the industry.
Thanks to new innovations, the electricity market is constantly changing. After a year or two, you should compare providers and consider your options. You may be able to find a better deal.
The Internet is an excellent resource for comparing prices. You can also ask for recommendations from friends and family.
4. Decide if you want a fixed or variable rate.
A fixed rate may be a bit higher than the current median price, but the cost will not change for the duration of your contract. The variable rate will be lower than the fixed rate at the start of your contract, but depending on how the market changes, you may be able to save money with a fixed rate.
Read your contract, learn the terms and ask questions before committing to a provider. Reviewing the terms of the contract will help you decide if you are making a wise financial decision, and if the price seems too good to be true, look for loopholes in the fine print. If you plan to switch providers, then be sure to sign up with the new company a month before the contract expires to avoid high switchover fees after the other contract ends.
Once you have settled on an electricity provider, look at the price comparison between fixed and variable rates. In most cases, it is smarter to settle for the fixed rate.
You may also want to look at how the company generates its electricity. While some rely on sustainable sources, such as solar and wind power, others are more dependent on non-renewable energy.
With a little research, you should have no trouble finding an electricity company that fits your needs and your budget. If you really want to add up the savings, then consider making energy efficient changes to your home or business to reduce power consumption.
Milo Senalle
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