Save Money By Choosing Your Electricity Supplier (with one Caution)
For the past 18 months we’ve been able to save a significant amount of money on our household electric bills by choosing what company supplies our electricity. The process is simple; your electric bill consists of two parts – delivery service and energy supply. Delivery service brings electricity to your home. In my area Public Service of New Hampshire (PSNH) does that. They take care of the power lines, transformers and service to your home. However, the energy supply portion of your bill is for the electricity you use in your home, and it’s calculated at cost per kilowatt hour (kWh). I could have continued to use PSNH as my energy supply company paying a variable rate, but instead I elected to shop around for a lower fixed rate. I’ve since used three different energy supply companies and on average have saved $15-$60 per month. So it sounds like a great deal, right? Here’s a word of caution – be very careful.
When you select an energy supply company other than the one that supplies delivery service, you have the option to lock in a fixed rate contract for a specific period of time. Some companies offer 6, 12 and 24 months. Be cautious, however, as when that time period ends, you must either choose another fixed rate with that same company or switch to another company or you will automatically be enrolled into a variable rate pricing structure that could cost double what you had already been paying. As an example, your electric bill could go from $75 to over $150 in a single month without any increase in usage. Avoiding this can be a challenge. At least 3 months before your fixed rate contract ends you should shop around for another low fixed rate by researching companies that do business in New Hampshire. You can do this online or over the phone. I know what you’re thinking – another budgeting expense to keep track of, and you’re right. Since rates and plans change all the time and more suppliers become available, it could turn into a very cumbersome effort. Entering into a new contract can take one to three billing cycles before it takes effect, and depending on the fixed rate contract you agreed to there are usually monetary penalties for breaking that contract early. On the other hand, if you wait too long you could be paying a higher variable rate, so timing becomes very important and challenging. You must time your new rate to take effect right after your old rate expires. This will save you the frustration of having to pay any penalties or pay a much higher variable rate. The great news is, if you stay on top of it, you will definitely save money.
For more information go to the New Hampshire Public Utilities Commission’s website, where it explains your options and lists all the competitive energy suppliers doing business in New Hampshire. http://www.puc.state.nh.us/Consumer/Choosing%20an%20Energy%20Supplier.html