Residential electricity prices will be increasing on April 1, 2013 for PECO Energy customers who have not shopped for a competitive electric rate. The current PECO price to compare rate – which includes power generation supply, the alternative energy portfolio standard charge, and transmission charge – of $0.0869 will increase to $0.0959 on April 1st, an increase of nine-tenths of a penny or 10.4%.

The rate increase will only occur for PECO Energy customers who are on default electric service. Default customers are those consumers who have not taken the time to shop for a lower electricity price from a competitive electricity company. As of January 16, 2013, 69% of PECO Energy customers remain on the PECO default service. The 10.4% increase on April 1st is expected to increase the number of PECO electricity shoppers as competitive energy companies are offering low electricity rates below even the current default prices.

The 31% of PECO Energy customers who have participated in the Pennsylvania electricity choice market will not be affected by the PECO electricity rate increase. Consumers who have locked themselves into low fixed electric rates can take pride in the fact that while the PECO electric bill will increase by 10% for the majority of their neighbors, their bills which most likely are already lower, will not see a rate increase.

One of the greatest benefits of Pennsylvania electricity choice is that it brings rate product choices to consumers. Many of the Pennsylvania consumers who have participated in electric choice have opted to select fixed rates that last a year or longer. This strategy has proved to be beneficial with the recent news of utility default rates increasing. Not only will selecting a fixed rate save you money in the near term, but it can help you save even more throughout the year as PECO adjusts their default Price to Compare.

See below for a list of competitive PECO electric rates that are apples-to-apples comparisons to the PECO default price to compare.

The competitive natural gas market is heating up in southeast Pennsylvania as PECO gas customers are learning that they have choices when it comes to who supplies them with gas to heat their homes this winter. Energy choice awareness picked up tremendously in 2012 in the PECO electric territory as 33% of the residential market bought their power from competitive electricity companies. This year natural gas shopping could have similar participation.

The PECO Gas price to compare, the default rate that PECO customers pay for gas service who do not shop for competitive rates, changes every three months. Currently natural gas prices are low compared to their historic averages. This presents a good buying opportunity for homeowners who want to lock in a low fixed gas rate for a year to protect themselves from potential gas rate increases.

As has been the case with electric choice, many competitive gas suppliers are offering incentives for customers to make the switch including cash back and gift cards. Ultimately price should be the most important thing when shopping for lower PECO gas rates, however getting a free gift never hurts!

Below are some competitive PECO gas rates available now. All rates are update daily and we will add offers as we receive them. Happy gas shopping!

The price for electricity generation supply will be less in 2013 for Connecticut Light & Power customers than it was in 2012. The electricity rate, which was above 8 cents for the entire 2012 calendar year, dropped to 7.615 cents on January 1, 2013 and will remain at that price for the entire calendar year in 2013.

The CL&P generation rate is the default electricity rate that consumers pay who have not shopped for competitive power rates. As an energy choice state, Connecticut consumers have the ability to shop and compare electric rates from multiple competitive electricity companies. Those consumer who choose not to shop pay a default rate with their local utility. In Connecticut the two major utilities are CL&P and The United Illuminating Power Company.

While the default CL&P rates have dropped, consumers can save even more by taking the time to shop for lower competitive electric rates. Below are offers from qualified competitive electric suppliers licensed by the state of Connecticut. All electricity rate offers are updated daily.

Energy choice has been alive in the state of Maryland for almost a decade, but it is only now beginning to sustain a healthy heartbeat. Increased customer awareness concerning competitive power is largely centered around the recent BG&E rate hike announcement. Maryland electricity choice provides a way for BG&E consumers to avoid the rate hike.

Baltimore Gas & Electric (BG&E) recently increased their electricity supply default rate and stated that their rates will shoot up another 17% on June 1, 2013 just in time for the high electricity usage summer season. This has caused BG&E default paying customers to start shopping the market for more competitive electric rates. BG&E is the largest electric utility in Maryland and is responsible for providing default service for all Baltimore electricity users.

Default customers are those consumers who have not taken the time to compare electric rates in the competitive market. These customers pay the BG&E price to compare rate, a price that is regulated by the Maryland Public Service Commission and the benchmark for competitive energy companies to offer pricing. Competitive electric rates must contain everything that the BG&E price to compare contains, allowing BG&E customers to compare prices on an even playing field.

The Met-Ed electricity default rates will increase for all rate classes across the board, including those for small and large businesses, starting December 1st. The new Met-Ed default rate for a business customers will go up to $0.09133/kWh. This will be an increase of 12% for companies who are still using Met-Ed as their default electric supplier. Businesses in the Met-Ed territory who are still on default service can expect to see the increase reflected on their first Met-Ed electric bill received in 2013.

Pennsylvania competitive electricity commercial rates are substantially lower than Met-Ed’s default rate. Commercial customers in Pennsylvania looking to switch to a competitive electricity supplier can expect to save 20-35% based on current market conditions. If a business looking to lower their costs decides to lock in a rate with a competitive electricity supplier they will still only receive one electric bill from Met-Ed.

With January and February expected to be cooler than last year, the demand for energy will go up which is sure to put more upward pressure on commercial electricity rates. Pennsylvania businesses looking to get off the Met-Ed default rate should consider locking in a rate before the holiday season swings into full gear.

In discussing the best time to lock in fixed business electricity rate contracts, there is a wide misconception that fixed electricity rates go down during the fall and spring season of the year. While recent historical data may lead one to believe this may be the case, following this to an end in itself is a fallacy and can cost businesses money as they sit around and wait for prices to potentially fall.

Fixed electricity pricing is based on future forward contracts. With natural gas being a significant source of electricity generation in Pennsylvania, fixed rates are highly correlated with natural gas future contracts. This means that when you look to lock in a two year fixed electricity price, the forward natural gas prices for the next 24 months have an effect on the final fixed price for power. Every month included in the duration of the contract will have a set rate the moment the contract is signed. The final fixed price will be the weighted average of the estimated amount of electricity a business is expected to use for a given month times the rate. This means if a Pennsylvania business customer decides to lock in a fixed commercial electricity rate in the middle of summer the price will take into account the cooler months that come along with the fall and spring seasons.

Locking in a fixed rate will protect Pennsylvania business customers from the volatility associated with the energy market. The fixed rate will put a ceiling on the price if the market were to rise during the term of the contract. If the market were to drop you are not necessarily stuck with having to pay a higher rate. More and more electricity suppliers are offering the blend and extend option in Pennsylvania. This allows a business electricity customer on a fixed rate product to immediately lower their rate at any point during the term of the contract in return of extending out the contract. Exercising this option will maximize the savings for the initial term of the agreement while extending out protection against the risk of a potential rise in future energy prices.

Fixed rates are the most common rate structure for those looking to get off PPL, Met-Ed, or PECO’s high default rates. One appealing feature of fixed rates is the transparency in allowing a company to forecast their annual electricity expenditures. Those businesses still on the utility default rate will have to deal with large swings in costs when the electric bill comes due. Budget certainty is a great asset to have when dealing with a volatile market. With the blend and extend option in place, Pennsylvania business customers looking to sign a fixed rate may want to consider locking in a term for several years.

The Pennsylvania electricity market is becoming more efficient as consistent market growth in customer and supplier participation has occurred. The Pennsylvania Public Utilities Commission announced that the enrollment window for a customer wishing to change electricity suppliers will shorten from 16 days to 11 days.

The enrollment window is the amount of time that a customer needs to submit their supplier change request prior to their meter read date. If the switch request is made inside of the enrollment window than the switch will not occur until the next months meter read date. Often this is the case causing a full two billing cycles to pass before a customer sees their new rate kick in. The large amount of time that passes between choosing an alternative supplier and actually seeing the effects on the electric bill has caused confusion and uncertainty in a new market for many consumers. When a customer chooses a lower rate, and then gets their bill 2 weeks later with the old higher rate still showing, the customer starts to doubt whether the switch has been made.

Why such a long wait period?

Customers participating in electricity choice for the first time are expecting the new low rate they have selected to kick in right away. Unfortunately this is not how the market currently functions. When a consumer chooses a competitive electricity supplier, that supplier than submits the order to the utility company who is regulated by the PA Public Utility Commission. With the market still being in its infancy, the utilities require a large enrollment window to get customers switched.

What is actually switching?

Switching electricity suppliers doesn’t involve manipulating the actual lines and wires. The way you receive power remains the same. The aspect that changes is who is billing you for your electricity supply, and at what electricity price. Even the billing period remains the same, and this is the reason that the switch has to wait until your scheduled meter read date. The utility (PECO, PPL, Duquesne, etc..) currently does not have the ability to charge from one rate structure for the first half of the billing period and then another for the second half; so the consumer has to wait until their meter read date when the billing period resets.

The move to real time switches

The change from a 16 to a 11 day enrollment window is a step towards real time switch ability; choosing a new rate plan one day and having that rate take effect immediately. As the electricity choice market becomes more mature it also becomes more efficient. There has been a lot of comparisons between the Texas electric choice market to that of Pennsylvania. When Texas first became deregulated in 2002, residential customers had to wait between 1-2 months after selecting a competitive price before they would see that price on their electric bill. Sound familiar? Ten years later, and the switch date is down to seven business days for shopping customers and only three days for customers moving into a new home. In addition, the actual competitive suppliers offering Dallas energy prices have the ability to turn the power on for the customer. In contrast, Pennsylvania suppliers have to turn the request over to the local regulated utilities which slows up the competitive process. When Pennsylvania allows suppliers to turn on service for customers, customer participation should grow exponentially.

Electricity choice in New York allows energy users to shop for competitive electricity and natural gas rates among a variety of companies offering innovating rate product options. Prior to the electricity market deregulating, residential customers were forced to accept the rate structure offered by their local utility company. With New York electricity choice these same customers can elect how they purchase their power through different term options and ways the power is generated. For example, New York electricity consumers who think energy prices will be rising might decide to lock in a fixed electric rate for 36 months. If they think prices will go down after the current season they might decide to lock in a six month fixed rate so that they are not bound to a contract for too long.

Customers of NYSEG, the third largest electric utility company in the state, pay an electricity supply rate through NYSEG that is variable. The variable rate changes monthly in response to the wholesale electricity market. Electricity prices like this can be very volatile as they are somewhat tied to other global energy markets such as natural gas and coal. World events and abnormal weather patterns can have huge effects on energy prices. It would not be uncommon for a variable rate structure to rise by 20% or more in one month.

However with choice, NYSEG electricity customers can mitigate the volatility by locking in low fixed electric rates through competitive energy companies called Electricity Service Companies (ESCOs). When a NYSEG customer chooses an ESCO to supply their power, the customer continues to be charged for delivery service by NYSEG. Since the NYSEG supply rate changes on a monthly basis, competitive ESCOs are usually unable to guarantee savings to customers, however by offering a fixed rate they are able to offer price stability for consumers who may not be able to afford a large rise in energy prices resulting in a higher than expected NYSEG electric bill.

Choosing a competitive electricity company that offers a low fixed electric rate has been the strategy for about 25% of NYSEG electricity customers.

With natural gas prices at low levels, more and more energy suppliers are using natural gas as the primary source to generate electricity. The increase percentage of natural gas in electricity generation production in Pennsylvania has caused commercial electricity rates and natural gas prices to be highly correlated; A rise in natural gas prices is sure to be followed by a jump in electricity rates.

Natural gas levels have boomed in recent year thanks in part to fracking, the method of pumping chemicals into the ground to extract the natural gas from shell rock. With storage levels near capacity, businesses in Pennsylvania have enjoyed declining commercial electricity rates for the past 3 years beginning in January 2010 when Pennsylvania Power and Light’s cap rates expired. These low rates have been marked by mild winters causing low demand to put further downward pressure on Pennsylvania’s electricity rates.

The high supply of natural gas does not mean Pennsylvania’s electricity rates will stay at low levels. The energy market remains extremely volatile and can easily jump in a short period of time as seen in 2008 when energy prices tripled. With natural gas levels near capacity and electricity rates near 10 year lows, businesses in Pennsylvania should start considering locking in a fixed electricity rates for the long run. This will protect the company against any unforeseen spikes in the energy market for the duration of the contract. Electricity choice gives business consumers the flexibility to buy power at advantageous times. With natural gas and electricity prices starting to bounce off of their lows in a time right before the winter season, now is the idea time to execute fixed commercial power contracts.

Pennsylvania business customers still with Pennsylvania Power and Light’s default service have experienced large swings in their default rates since the PPL cap rates first expired in 2010. They are not alone as many customers still on Met-Ed’s default rate and PECO’s default rate have also experienced large fluctuations in the price of their electric bill. As higher default rates force many to start shopping for competitive electricity rates it is important to understand the basics of Pennsylvania electricity deregulation and what it means for electricity choice in your area.

The electric bill is split up into two basic charges: distribution charge and supply charge. The distribution charge is a regulated charge and will not be affected by switching to a competitive electricity supplier. The distribution charge deals with the cost of maintaining the lines and wires so the electricity can be transferred from your local distribution company directly to your business. The supply charge is the deregulated charge. If your company decides to stay with PECO, Met-Ed, or PPL you will be set up on a default rate determined by a series of auctions. A company on the default rate can choose to switch to a competitive supplier anytime without being penalized. Due to a number of factors involved including the high volatility of the energy market, a company will be charged a premium if they decide to stay on the default rate.

When you start shopping for competitive electricity rates it is important to make sure the suppliers are including all components of the supply charge. The three basic components of the supply charge are energy, capacity, and transmission. These components can be further dissected to line loss, ancillary, congestion and so forth. Some suppliers will leave out a component of the supply charge to make their rate more attractive. However this charge will then be bypassed onto your electric bill as a separate charge. It is important when shopping for competitive electricity rates to let the supplier know you want an apples to apples comparison to your utilities default rate. Do not let this deter you from taking advantage of the large margin of savings. A typical commercial business in Pennsylvania still on the PECO, PPL, or Met-Ed’s rate will save an average of 15-35% per year by choosing a competitive electricity supplier.