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How to Compare Electricity Rates and Providers

The difference between your bill and a new electricity plan may be in the hundreds.

Not everyone is bound to one electric company. You can shop around for better prices, compare quotes to your current plan and potentially save hundreds on your electric bill — simply by changing energy providers. Here’s what you need to know about comparing electricity plans and making the switch.

Can I switch electric companies?

Maybe. Regulated states, like Mississippi and Missouri, can’t switch electric companies. These states have utilities that control the entire electricity pipeline — from source to meter.

Deregulated states can choose their own energy provider while keeping their local utility company. You can choose who supplies your energy, and your current electric utility company will maintain the infrastructure, including power lines and utility poles, to deliver it to you. The following states have deregulated or partially deregulated electricity markets:

  • California
  • Connecticut
  • Delaware
  • Illinois
  • Maine
  • Maryland
  • Massachusetts
  • Michigan
  • New Hampshire
  • New Jersey
  • New York
  • Ohio
  • Oregon
  • Pennsylvania
  • Rhode Island
  • Texas
  • Virginia
  • Washington, DC

What is the monthly average cost of electricity?

The average cost of electricity for residential use was 13.55 cents per Kilowatt hour (kWh) in September 2020. A few factors that influence your energy costs include fuel prices, the demand for heating and cooling especially during the summer and winter months, and supply and distribution system maintenance costs.

Though people use different amounts of electricity, here’s what you might pay for your monthly electric bill:

StateAverage Monthly Bill
Alabama$150.45
Alaska$127.29
Arizona$126.09
Arkansas$109.46
California$101.92
Colorado$83.07
Connecticut$150.71
Delaware$119.16
District of Columbia$97.62
Florida$129.65
Georgia$131.84
Hawaii$168.21
Idaho$93.83
Illinois$92.37
Indiana$120.74
Iowa$108.04
Kansas$113.26
Kentucky$120.08
Louisiana$120.70
Maine$100.53
Maryland$127.92
Massachusetts$125.89
Michigan$100.23
Minnesota$99.02
Mississippi$135.87
Missouri$117.82
Montana$95.43
Nebraska$108.08
Nevada$106.83
New Hampshire$120.04
New Jersey$105.07
New Mexico$80.04
New York$103.60
North Carolina$123.25
North Dakota$114.27
Ohio$108.15
Oklahoma$113.93
Oregon$100.35
Pennsylvania$115.47
Rhode Island$121.62
South Carolina$144.73
South Dakota$120.60
Tennessee$132.33
Texas$134.07
Utah$75.63
Vermont$97.18
Virginia$135.46
Washington$94.49
West Virginia$121.90
Wisconsin$95.52
Wyoming$96.53
U.S. Total$115.49

How do electricity rates work?

Plans have two main rates. First is the supply charge, which you pay per kWh of energy you actually consume. Second is the delivery rate, which you pay daily just to be connected to the power grid.
Understand how to read your electric bill

How much can you save by comparing electricity plans?

If you’re in a deregulated state, here is how much you could save, excluding taxes and fees, by comparing electricity rates if you used 1,000 kWh a month. Your actual bill may be larger or smaller, depending on your energy consumption and rate quote.

Old rateNew rateSavings
Monthly9.8 cents per kWh6.59 cents per kWh$32.10
6 months9.8 cents per kWh6.59 cents per kWh$192.60
12 months9.8 cents per kWh6.59 cents per kWh$385.20

Learn how to compare gas suppliers

How do I compare energy plans?

Getting the best deal involves comparing energy retailers and the features offered by each plan.

Pricing features

FeatureWhat it isWho should consider it
Supply rateA supply rate is the amount you are charged for energy use.Everyone, but especially those who use a lot of energy.
Delivery rateA delivery rate is the amount you are charged for being connected to the grid.Everyone, but especially

  • Seniors
  • Single households
  • Couples
  • Households with low usage.
Prepaid packsPrepaid packs let you pay for energy ahead of time, based on how much energy you expect to use.
  • People with consistent energy use habits.
  • Those who actively track good on-the-spot deals.
Wholesale rates e.g. GriddyPurchase energy at the same rate that retailers have access to, updated in real-time. Usually involves a membership fee.
  • Value hunters who stay on top of current prices.
  • Green-conscious customers who want to purchase cheap renewable power.
  • Solar customers looking to get the most out of their exports.
Fixed ratesUsage and supply rates are set to a single value for the duration of the benefit period.
  • Customers who like to set up their energy plan and then not worry about it for the next year or so.
Variable ratesUsage and supply rates can change at short notice, raising or, occasionally, lowering.
  • Those who don’t like to pay close attention to their energy plans could end up paying more.
Time-of-use ratesGet lower rates during off-peak periods, generally at night and from October to May.
  • Those who aren’t home or use minimal electricity during the day and summer months.

Contract features

FeatureWhat it isWho should consider it
Termination feeThe amount you pay if you leave a fixed-term contract before it expires.Everyone on a contract, but especially:

  • Students.
  • Single households.
  • Renters or frequent movers.
  • People who dislike commitment.
Disconnection and connection fees when you moveFees charged to have your gas and power connected or disconnected when you move to or from a property.Anyone who is moving, but especially:

  • Students.

Single households.

  • Family households.
  • Commitment-averse people.
  • Renters and frequent movers.

 

Disconnection and reconnection fees for nonpaymentIf you fail to pay your energy bills, your retailer might disconnect your house and charge you an extra fee to reconnect it later.
  • Those who frequently fall behind on bills.

Discounts and incentives

FeatureWhat it isWho should consider it
Guaranteed discountThis is a discount on your usage and/or supply rates that applies no matter what for a set period.
  • Busy customers who don’t want to worry about conditions.
Pay-on-time discountA discount that applies to your whole bill so long as you’re never late with payments.
  • People hunting for the best value on a plan.
  • Customers who don’t want to stay on top of their energy plan.
IncentivesThese are bonus features offered to customers. They could be rewards, extras, frequent flyer points, etc.
  • People looking to squeeze out some extra value.
  • Spenders who enjoy the rewards on offers.
Bonus signup creditsExtra bill credit offered to new customers signing up for the plan.Anyone who wants extra value, including:

  • Students.
  • Renters and frequent movers.
  • Value hunters.
  • People lacking financial security.

Service rates

FeatureWhat it isWho should consider it
Time-of-use rateUsage costs depend on when you use your energy, split up into peak, off-peak, and sometimes shoulder periods.
  • Energy use optimizers.
  • Value hunters.
  • People who don’t want to think about their energy use.
Single rateAll energy use is billed at the same usage rate, regardless of the time of use.
  • People who don’t want to think about their energy use.

Solar features

FeatureWhat it isWho should consider it
Feed-in tariffThe rate paid for excess solar energy fed back into the grid.Anyone with solar panels, but especially:

  • Energy optimizers.
  • Value hunters.
  • Green-conscious users.
Solar rebateThis a refund that you might be eligible to receive from the government for your solar panels.Anyone with solar panels, but especially:

  • Value hunters.

Green features

FeatureWhat it isWho should consider it
GreenPowerAn optional extra where a certain percentage of your energy is guaranteed to come from renewable sources.Environmentally-conscious customers.
GreenAwardRates retailers on a number of criteria, including environmental performance, support for clean tech, GreenPower options, and more.Environmentally-conscious customers.

Customer service features

FeatureWhat it isWho should consider it
Customer reviewsHow current customers feel about the company’s customer service, including ease of access and helpfulness.Careful customers or those who want to sign up with a retailer who is responsive.
Call center hours/weekend hoursWhat time of day you can get in touch with the call center and receive help.Customers who like being able to get in contact with their retailer easily.
Financial hardship programPrograms in place for people who can’t afford to pay their bills or are having cash-flow issues.Those without solid financial security.
Online chatAvailability of online chat services for real-time assistance.People who may need increased accessibility or more flexible communication.
Usage management appApps for tracking your power usage and keeping an eye on solar production.
  • Energy optimizers
  • Those looking for better value

Bottom line

If you’re in a deregulated state, you have the choice to use another energy supplier. Learn more about your energy options to see if you can save on your monthly electric bill.

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