Deregulation Continues Across America

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Monopoly has been a dirty word in the United States since the Sherman Antitrust Act of 1890. This fact, however, has not prevented the nation’s energy industry from being held down by the weight of power supply monopolies in each state. However, times are changing, deregulation is here and now in full swing in many states.

Regulators (and more importantly, consumers) have been keenly aware of the monopolies utilities have operated for decades but in the past fifteen years, regulators have begun to act. This action is mostly coming in the form of altering and/or the removal of restrictive laws in the energy industry that make it impossible for a new energy company to exist, let alone compete with the energy industry monoliths. The common term for these changes is deregulation. Although the energy industries in many states are still unfairly regulated, there are many states in which deregulation is spreading and fast. As of right now, over half of all states have enacted deregulation at some level—and the list is growing fast. Let’s take a look at how the spread of deregulation in the energy industry has changed things:

How energy industry deregulation across America affects energy companies

The big energy companies may not have welcomed the prospect of deregulation. Electric companies in PA, for example, held off deregulation for years. This is due to the fact that when a company enjoys a monopoly, they can whatever they want to do—charge whatever rates they want, add arbitrary fees, provide mediocre customer service, etc. When they are the one company that holds all of the power, they can do what they like.

With deregulation in place, the industry has opened up to hundreds of new electric companies in PA, CT, NJ, MD, OH, MA, ME, TX, GA and every other state that is deregulated for that matter. Now utilities have had to adjust how they do business, sell off their generation assets and purchase power from wholesale power plants just like all of the new competitive suppliers do.  The utilities also promote electric choice now and help to grow the consumer awareness level in their state about the benefits electric choice can provide to their customers.

How deregulation could affect you

There are many changes wrought by deregulation, but the most important are those that affect you. Here is what you get from deregulation:
More choice

When a monopoly is in place and you need a product or service, you go to that one company that offers them. Since deregulation breaks up monopolies in the industry, you can choose from among other power companies in your area. The growth in the  number of energy companies across the USA has been substantial. For instance, there are now over 50 electric companies in CT, where there was once only two.

Lower energy bills

With choice comes competition, and when companies are competing, prices go down. When you take advantage of this by shopping around for the best rate, you end up paying less on your monthly bill.

A few avoidable problems

There are a few potential issues that you could run into in a deregulated energy market. Some of the electric companies in PA and CT, for example, are receiving complaints about extremely high variable rates. This problem can easily be avoided by customers who do basic due diligence and only consider fixed rates.

How to make a switch if you live in a deregulated state

To make the switch to another power supplier is easy, thanks to companies that connect you directly with the energy suppliers in your area. Make the Switch USA, for example, gives you the power to compare and contrast the offerings of electric companies in PA, CT and NJ.

What further action needs to be taken to enhance deregulation as it spreads?

Deregulation is helping, but more steps need to be taken to further improve the energy industry. Here is what you can expect legislators in deregulated and regulated states to do in the near future:

Informing customers

You can’t take advantage of energy industry deregulation if you don’t know about it. This fact is not lost on many states. For example, there are more power companies in NJ than ever before. Despite this fact—and the fact that they have been deregulated for 15 years—less than a fifth of all customers in the state use an electric company outside of the traditional utility companies.

Protecting customers

As we mentioned earlier, there are some ways that predatory energy companies can take advantage of deregulation in a way that harms customers. Fortunately, some states are taking action. In Connecticut, for example, legislators just passed laws that stunt the ability of electric companies in CT to surprise people with deceptively high variable rates.

The Author is a prominent writer of various blogs and articles about Electric Companies in PA. Currently, he is writing about the causes and reasons of Energy bills and the how to prevent these electricity rates in residential as well as commercial areas.

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