The Benefits of Retail Energy Competition

Benefits of Competition
Differences From Monopolies
Competition Boosts Renewables & Innovation
Rise in Competitive Shopping

Benefits of Competition

Shopping for competitively priced retail electricity and natural gas allows families, businesses and manufacturers to find energy solutions and take control of their energy costs. With multiple energy providers competing to provide electricity and natural gas, homeowners and businesses benefit from access to competitively priced energy products and services provided by suppliers eager to obtain and maintain their customers’ business. Competitive electricity and natural gas suppliers are attentive to their customers’ needs, and can provide innovative energy solutions tailored to individual customers’ needs and circumstances.

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Differences From Monopolies

This is fundamentally different from traditional monopoly-protected and price-regulated electricity utility companies, which have no competitors and are guaranteed a profit through complicated and arcane government-derived rate structures. With a government-protected monopoly service territory, a utility company has no incentive to be attentive to customers’ individual needs and circumstances. And with government-guaranteed profits, monopoly utilities have little or no incentive to cut costs or offer innovative products and services.

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Competition Boosts Renewables & Innovation

Retail energy competition has fostered the development of “green” energy, time-of-use pricing, energy efficiency and demand response programs that allow retail electric customers to participate in competitive wholesale power markets by receiving payments to curb usage during periods of intense demand. Demand response programs help all customers, since it is less costly to curb demand than to build new generation resources to meet peak demand.

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Rise in Competitive Shopping

Increasing numbers of residential, business and industrial customers are recognizing the benefits of competition and choosing to shop for electricity and natural gas. By the end of 2011, nearly 20 percent of all the electricity in America was supplied by a competitive provider, despite the fact that customer choice is available to consumers representing only 44 percent of total U.S. electricity load.

The clear benefits of energy competition, as demonstrated in the states that provide consumers with the right to find energy solutions and choose an energy supplier, is creating growing demand for choice from customers in the states that have maintained the traditional monopoly protected price-regulated system.

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Retail Energy in Your State

States have varying competitive energy landscapes with certain policies and practices that promote electricity competition at retail. Learn about retail energy in your state.

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Be a Smart Energy Buyer

Learn about retail energy markets and discover the retail energy shopping options available to consumers.

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