If you are a small business owner, you should know that for 35% of small businesses, energy costs form one of the top three business expenses which means you can save a whole lot of money and boost your bottom line by reducing energy bills. Energy deregulation has brought about a lot of competition and it is one of the simplest ways to reduce your energy bills.
In my opinion, only a few business owners understand the options available to them when it comes to choosing their electricity provider. The deregulation of energy offers an opportunity for businesses to save a lot of money in a number of US states due to enhanced competition in the sector. You may also reduce your utility bills by moving away from a variable rate cost structure to a fixed rate cost structure that is more budgets-certain. In some cases, you might also get green electricity without any initial investment.
Currently, 17 states in the country offer electricity choice and if you are based in one of these states, here is how you can get started.
Electricity Deregulation Benefits
Consumers have benefited by deregulation in many industries including telecommunication and airline as it brought about more products, lower prices and better services. Increased competition led to a change in consumer behavior when they placed heavy emphasis on comparison of rates and prices which also explains the popularity of travel comparison sites including Expedia and Kayak.
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The deregulation of energy industry in several states that also includes New York offers a lot of options to business owners and individuals for utilities. The deregulation has brought in new electricity suppliers who have introduced new features that were not available with existing utility companies and they have also reduced prices along with option of renewable energy sources such as wind, hydro and solar. Some suppliers have also introduced fixed rate plans that are more budget-certain.
Breaking Down Your Electricity Service Cost
In simple terms, the electricity service is made up of two parts including supply and delivery. Your local utility manages the delivery part as they own the wires providing electricity to the building and you can’t change anything there.
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Deregulation allows you to choose your supplier. If you, as a business owner, don’t make any choice, your default supplier is going to be the local utility. Most local utilities charge a variable rate and that keeps fluctuating every month at the discretion of the local utility. This is the part where you, as a business owner, can save money on energy costs. If you want an example of a forward thinking company in this area look at Joscos energy policies
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Making a Switch – Things You Need to Look for
When you want to move on to a new electricity provider, you have two options. First one involves getting in touch with the new provider and asking them to give you a quote. In addition, you will have to do the required paperwork and get that paperwork back to the provider. This exercise needs to be repeated with other providers in order to compare the rates. The other option is to use a company such as ours in order to do most of this work online.
Regardless of the option you choose, you are going to get the same exact bill that you are getting now from the existing utility company but it will reflect the new supplier on the second page of the bill. Keep in mind that the new supplier is responsible for supplying the electricity but the delivery part of the service is the responsibility of your existing utility company and that also includes any maintenance and service interruptions.
Here are three things you should consider when you want to make a switch:
1. A Reduction in Overall Utility Bills
Your ultimate goal is to reduce your electricity bill when you start the process of comparing and choosing a new electricity supplier. Since many suppliers are going to compete for your business, you are likely to find some great deals that offer low rates which are likely to be much lower than the existing variable rate being charged by your utility.
2. Green Electricity Option at Zero Initial Cost
For some small businesses, there already exists the option of using green electricity such as solar but it involves an initial cost. For instance, using solar energy by installing solar panels on the roof will require you to invest significant amount of capital, effort and time. In some cases, solar energy option is not a viable solution, especially if you run a business with high demand for energy such as a pizza shop or a restaurant.
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With deregulation, businesses operating in energy – deregulated states have the option to choose green electricity without any initial investment as there are more plans available today with green electricity options.
3. Fixed Instead Of Variable
If you don’t exercise the options available to you for electricity suppliers, you will continue to get electricity from your local utility and in most cases, you will have to pay a variable rate. This rate keeps fluctuating each month and it could be quite volatile. You will have great peace of mind by moving to a fixed rate plan as you will know what you are going to pay for the duration of your contract.
Businesses and consumers have benefited by taking advantage of deregulation in various industries including airlines and it’s time for you to learn about energy deregulation in order to benefit from the increased competition in this sector.