How to choose which bill rate type is right for youWhen energy providers compete, a whole new world of options are available to consumers, allowing them to shop around for the best prices. But customers don’t only shop based on price – there are several other avenues through which independent energy suppliers can differentiate themselves in order to attract business.

One way they can do this is by offering different rate categories. Not only can customers find the best prices, they can find the most convenient way by which they will pay their bill. Here are a few of the rate categories available today.

Fixed, Variable and Hybrid Rates

The major rate categories offered by independent providers are fixed, variable, and hybrid. It’s important to remember, however, that deregulated energy markets often lead to innovations in terms of promotions, pricing and delivery. It is not too much to expect that even better rate categories will spring up at some point, giving consumers more opportunity to customize their energy bill. Here are the three kinds of rate plans.

Fixed

– A fixed rate bill gives the customer a chance to lock in one rate for the duration of the contract. This means that regardless of how the electricity rates fluctuate, the bill remains the same. This can lead to substantial savings in the event of a spike in energy costs. While prices can also drop from time to time, many customers still enjoy the ability to reliably predict their bills each month.

Variable

– A variable rate means that the customer’s rate is subject to the variances in electricity rates. While this is good for the customer if rates fall, it leaves them with no protection in the event of a price hike.

Hybrid

– The hybrid option is usually presented as a combination of a fixed and variable rate bill. The hybrid bill may be a fixed rate for some duration of the contract, and after a predetermined amount of time, it will switch to a variable rate.

Things to consider when choosing a rate

The New Jersey Board of Public Utilities said that shoppers should keep a few things in mind as they decide which rate is best for them.

  • How long is the duration of the contract?
  • Are there any penalties for opting out of your contract early?
  • Is sales tax included in the listed price?
  • Are there any other charges or fees?

Let us work with you to design a plan