If you live in a completely unregulated electricity market, you have the freedom to choose your energy provider for your residential and non – residential property. However, if you’ve been looking for electric rates and plans, you’ve probably noticed that the prices of these proposals vary a lot.

Energy prices can differ from one customer to the next. The price can differ even if they live in the same area, city, or community. The reasons for these differences vary according to individual situations, but we’ve identified ten major causes why electricity rates differ from consumer to consumer. Recognizing these reasons is critical for any electricity consumer who wishes to discuss the plan they are purchasing, irrespective of whether they are asking about residential or commercial electricity rates.


  • Time of Year – The season in which you bought a new electricity plan can have a significant impact on how much that electricity costs. Energy bills fluctuate almost every moment of the day, but they are generally highest in the warmer months.
  • Location – Every location is unique, and energy prices can vary dramatically depending on where you live. Hawaii has some of the nation’s highest rates, while Washington state does have some of the cheapest rates. Certain states and cities are infamously more expensive than the rest. You will be surprised to know that prices can even vary in the same jurisdiction or utility, depending on the industry, consumption type, and market situation.
  • Competitive Markets – The ability of clients to choose is the primary source of variation in power prices in deregulated marketplaces. The larger and more competitive the industry, the more fluctuation there is likely to be.
  • Renewable Energy – Green energy has become the latest craze for local suppliers in deregulated states such as Texas, Ohio, and Pennsylvania. The availability of renewable energy, the category of source, and the quantity of renewable energy used can all have an impact on energy prices in a specific area.
  • Minimum Utilization Charges – Most providers have a minimal level that they necessitate their clients to meet for their plan, which means that no matter how much electricity they use, the consumer will always be billed. This amount, as well as the environment that surrounds minimum utilization charges, can have an impact on the rates that each customer must pay for their strategy.
  • Electricity Suppliers’ Overhead – Individual electric retail stores can sell electricity to customers in completely unregulated states. The amount that businesses bill their customers is determined by how much it costs to produce that power and how much the distributors can get it for.
  • The Brokers’ Influence – An energy broker works very closely with retail energy suppliers and customers to determine the best price and strategy for the consumer’s needs. Consider it like a real estate professional selling the house for you: the more the broker tries to negotiate for you and the more assertive they are in acquiring electricity for you, the better bargain (and reduced rates) you can often get.
  • Customer Type – If you are looking for both a residential and industrial energy plan, you will most probably notice some difference in the respective rates.
  • Individual Plans – Because every plan and every company are unique, smart consumers take the time to evaluate the multiple proposals available. There are variable plans, which fluctuate with the industry, and fixed plans, which ensure a fixed rate for a longer length of time. The cost of energy per kWh can vary according to the type of rate selected by each customer.

Conclusion

These factors all play a significant role in determining the ultimate rate or price per kWh for electricity consumers. Acknowledging these impacts and why they have an influence on the price can only help customers be more aware and savvy when it comes to finding a new energy policy for their estate.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.