The most basic element of an electricity plan is the rate. On this site and elsewhere, this number is expressed in terms of cents per kilowatt hour. When you enter your zip code into the box above, the first thing you’ll see is a list of providers and the rates they’re offering.
Nationally, The rates in different sectors and locations range from 4.09 ¢/kW-h in the Washington industrial sector to 31.04 ¢/kW-h for residents of Hawaii.
2. Variable vs. Fixed Electricity Plans
There’s more to the quoted price in ¢/kW-h than meets the eye. Your choice of a variable or fixed electricity plan will affect the rate you actually pay in the months to come.
If you choose a fixed-rate plan, you will pay the same rate you see in front of you when you sign up. Maybe a major pipeline will explode and double the cost of energy; maybe the world will perfect cold fusion and have as much electricity as it needs. Either way, you’ll be paying the same price until your contract expires.
With a variable-rate plan, the amount you pay is tied to the market. A variable-rate plan may benefit you financially if the market price of energy goes down, but it does add some risk. Nevertheless, a variable-rate plan from an alternate provider is very likely to save you money, compared to a default plan from your local utility.
3. Contract Length
Electricity companies also offer plans with different contract lengths. For example, the same company might offer contracts lasting 6, 12, or 24 months. Longer contracts sometimes come at a slightly higher price, since they are increasingly likely to beat the market as time goes by. (However, a longer contract will limit your ability to compare electricity plans for a better deal in the future.) Remember, you can always cancel a policy, but you’ll probably have to pay a large fee to do so.
4. Signup Bonuses
Some plans come with signup bonuses, like a month of free electricity at the beginning of a two-year conflict. These bonuses vary widely from company to company, although the most common is a gift card that you can redeem for power. A good signup bonus can make up for a higher rate, particularly if you are low on funds now and don’t expect to be later.
Note that a signup bonus is worth comparatively less when attached to a longer contract!
5. Energy Source
If you feel strongly about renewable electricity for one reason or another, you may wish to explicitly order your energy from a renewable source. Many companies offer plans that are guaranteed to be sourced from 100% renewable power. (Some companies sell only renewable power.) You can sometimes choose exactly what source you want your energy to come from.
The price of renewable energy is sometimes but not always higher than the price of whatever amalgam of dirty energy is generally available.