Electricity rates are not always directly comparable between utility companies because every state has different regulations, energy sources, infrastructure costs, taxes, and billing systems.
When reviewing electricity costs, consider the following factors:
1. Electricity Supply Rate
The supply rate may cover the cost of generating or purchasing electricity.
In competitive markets, customers may be able to select a retail supplier. The available plan could include:
- Fixed pricing
- Variable pricing
- Renewable-energy options
- Contract-based plans
- Month-to-month plans
Customers should read all plan terms before enrolling.
2. Delivery Charges
Delivery charges may support:
- Power lines
- Poles
- Transformers
- Substations
- Meter systems
- Grid maintenance
- Outage restoration
These charges may remain associated with the local utility even when customers choose another electricity supplier.
3. Taxes and Fees
A utility bill may include:
- State taxes
- Local taxes
- Regulatory charges
- Public-benefit fees
- Infrastructure charges
The exact charges depend on the location.
4. Fixed Monthly Charges
Some utility bills include a fixed customer charge that applies regardless of total electricity use.
5. Energy Usage
Electricity consumption is generally measured in kilowatt-hours, or kWh.
Higher electricity use may increase the total bill, although rate structures can vary.
6. Time-of-Use Pricing
Some utilities offer time-based rates. Electricity may cost different amounts depending on the time of day.
Customers should understand:
- Peak periods
- Off-peak periods
- Seasonal pricing
- Eligibility requirements