The Top 4 Myths About Switching Electric Companies

Some myths about switching electricity suppliers

Residential electric customers have been able to take advantage of electric deregulation for a while in some states, like California and Texas, while in other states, like Illinois and Pennsylvania, the breakup of electric utility monopolies is a more recent development and electric choice for residential customers is relatively new.

If you live in a deregulated electric market, the local electric utility is no longer the only electric company in town and many alternative electricity suppliers are allowed to compete for your business. Although the utility is still responsible for maintaining the electric grid, delivering electricity to homes and handling all service and outage problems, consumers can buy their electricity from the utility or one of several retail electric suppliers.

Many people may understand that they have the power to choose an alternative electric supplier, but a lot of residential electricity customers still buy electricity from their utility because of misconceptions or rumors they’ve heard suggesting that something about their electric service will change for the worse if they switch. That’s why we’ve set out to set the record straight on the top four myths about switching electric companies.

Myth #1: The utility will give you poor service if you switch.

Your utility will not treat you differently or poorly, allow for interruptions of service or fail to respond to outages and service requests if you leave them and switch to an alternative electric supplier.

Even in deregulated electric markets, electric utilities are regulated with regard to electric delivery. Utilities are responsible for providing the same level of service for all electricity users and are charged with maintaining the entire grid and its entire delivery infrastructure, including wires, poles and transformers, regardless of which electric supplier customers buy their power from.

Like any company, some electricity suppliers offer better customer support than others. When you shop around for an electric company, make sure they offer things like U.S.-based customer service; convenient communication through phone, email and online chat; and bilingual support for Spanish customers.

Myth #2: Your electric service could be temporarily interrupted if you switch.

There will never be an interruption of service when you switch from your utility to an alternative electric supplier or from one electric supplier to another. Although switching might not be immediate in some cases — it could take a billing cycle or more to complete the switch — the transition is seamless. In fact, the only two things that might change are how much you pay for electricity and how you’re billed.

In some markets, you may get separate monthly bills: one for the amount of electricity you use (from your electric supplier) and one for the distribution of the electricity to your home (from your utility). In other markets, you might get only one bill. In that case, your electric supplier will “piggyback” its supply charges onto the distribution bill from your utility, showing up as either a detailed list of charges or as a single line item charge, depending on what the utility allows.

Myth #3: If you switch and the power goes out, nobody will respond.

Your utility remains responsible for responding to power outages. That means that even if you switch to an alternative electric supplier, you’ll be able to call your utility just as you always have, at the same number, to report an outage. When you switch, your new electric supplier doesn’t take over maintenance and outages and the utility won’t leave you hanging because you left them.

Myth #4: Alternative electric suppliers make up for cheap electric rates with hidden charges.

Although it’s true that alternative electric suppliers often charge fees — just like utilities do — reputable electric suppliers are very up-front about additional fees and monthly charges.

There are usually a few taxes, such as a sales tax, that every residential electricity customer will pay, no matter which company they buy their electricity from, including a utility. Other times, there may be a monthly fee associated with a particular type of plan, but at a reputable electric company, those fees are fully disclosed.

Many electric customers who don’t switch from their utility to an alternative electric supplier are concerned that one or more of these top four myths about switching electric companies might be true. However, these myths are just that — myths. In reality, the only thing that’s different for most electric customers who switch, when compared to their utility, is the amount they save off of their monthly electric bill.

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