Deregulation of the electric and natural gas markets came on the heels of deregulation in the airline, trucking and telephone industries. Those industries underwent drastic changes during periods of expansion and contraction. Today, airfare and phone rates adjusted-for-inflation, are considerably less than they were in the 1980s and many new products and services exist. In deregulation of the electric industries and natural gas, only the price of the commodity supply has been opened to competition. In the 90s, the deregulation of energy markets gave customers the power to choose. Introducing multiple providers broke up the monopolies and forced companies to compete for their customers through lower prices and special offers. Energy deregulation isn’t everywhere-there are still several areas of the country stuck with one option. If you do live in a deregulated market, shop around and take advantage of the competition.
What does energy deregulation mean to you?
This means consumers in many states, who are served by investor-owned utilities, are now able to choose who supplies their natural gas and/or electricity. Energy Deregulation means choice. You are now able to choose who you purchase your natural gas or electricity from. Before energy deregulation, you were forced to buy your energy from the local utility company; the rates were regulated; and you had no control over pricing. The transmission and distribution of natural gas and electricity is not open to choice, and the price for those services continues to be set by state and federally approved tariffs. The push for deregulation of natural gas and electric came when the Federal Energy Regulatory Commission (FERC) decided it should limit its authority to wholesale transactions. This move cleared the way for individual states to determine if and how they should allow retail price competition. Today not only can you choose from a number of independent third party providers but pricing options are also more plentiful.
Your right to choose is:
You now have options to choose your provider, to offer competitive pricing.
With more competition in the market, you benefit from a variety of product options that may have otherwise not been available to you, which ensures that the equivalent of up to 100% of the energy you consume is offset by sustainable energy sources.
No service interruptions
Although your natural gas and/or electricity supply will be coming from a new source, your local utility/distribution company will continue to ensure the consistent delivery of the energy to your home.
What is the deregulation of energy?
Over the last several years, a number of states have begun to change the regulations in the energy industry to enhance competition between energy providers. The deregulation of energy has divided the utility company monopolies by separating the production of energy from it’s distribution. This separation creates more competition. Prior to this deregulation, both electricity and natural gas were provided by local utilities or regional monopolies that controlled both the power generation and distribution channels for delivery. From the customer or end user’s perspective, nothing will change. There will be no interruption of services, their current utility provider still maintains service and bills the customer’s account. It is possible that the consumer may receive a separate bill from the energy provider instead of one bill from their utility company.
Will you benefit from the deregulation of energy?
The benefit of a deregulated market is that it boosts competition among suppliers, which leads to lower prices and the chance for customers to find the best deal. Determining if your state participates is where it gets tricky. It is being executed on a state-by-state basis, but some have deregulated natural gas and others strictly have deregulated electricity.
While the opportunity to save money by lowering your bills with energy deregulation is fantastic, there is also a tremendous opportunity to generate income by helping individuals, small businesses, and large corporations save money on their utility expenses by educating them about their energy choices.
The benefit of a deregulated market is that it boosts competition among suppliers, which leads to lower prices and the chance for customers to find the best deal. Determining if your state participates is where it gets tricky. It is being executed on a state-by-state basis, but some have deregulated natural gas and others strictly have deregulated electricity. Once you determine that you live in a deregulated state, you can shop around for an electricity supplier that will offer the very best rate. This rate will be reflected in the supply portion of your monthly bill, which accounts for roughly fifty percent of your total statement. The other half includes the cost of transmission, delivery, and services provided by the utility.
Illinois Natural gas was deregulated in April of 1993, allowing end users to buy from marketers and brokers instead of just from the utility or pipeline.
Illinois Deregulated Electricity.
Dec. 1997: The Illinois Legislature passed a bill proposing that deregulation be implemented for some commercial and industrial customers by October 1999 and for all customers by May 2002.
May 2002: All Illinois electricity customers became eligible for retail choice.
Starting in 2007 residential and small business electricity customers gradually switched to independent suppliers.
2008: First Residential Customers Switch to an Alternative Electric Provider.
During 2008, thanks to a pilot program by one ARES in ComEd’s service territory, the first residential customers – only a handful – left their utilities and switched to an ARES. In a deregulated market, although residential and commercial customers can continue to buy electricity from their utilities, customers are allowed to buy electricity from competing retail electric providers, called alternative retail electric suppliers (ARES).
In a deregulated market, the utility remains responsible for transmitting electricity and distributing it to homes and businesses, regardless of which electric provider supplies it.
2014: Electric deregulation has saved Illinois customers as much as $37 billion over the past 16 years.