Our clients ask us: Where can I buy electricity or natural gas for my home or business? Where can i buy propane, heating oil, diesel, gasoline or other fuels so I can protect myself from unexpected -- and unbudgeted -- price increases?
In most of the United States utilities still enjoy monopoly control over the distribution of electricity and natural gas. Some industrial and large commercial buyers are able to negotiate supply deals with independent wholesale marketing companies; most customers including small commercial and residential must go to their local utilities.
Notwithstanding the prevalence of monopoly power, most of the US population is located in states that have deregulated the utilities. In those states, subject to state utility regulation and local utility rules, customers may purchase their electricity and natural gas from independent third party marketers. Customers continue to receive their power and gas over wires and pipelines that continue to be controlled by the utilities. This continued dominance over the distribution system is necessary to avoid chaos on the grid.
Competitive supply offers are available in some 15 states and the District of Columbia in the case of electricity and 22 states in the case of natural gas. See the maps and links below to check whether your state has opened the door to competitive supply. You should check with your local utility to confirm whether the utility has adopted rules to implement the deregulation regime.
States open to competitive bids for electricity – most of the large population states with the exception of California — are shown in this map:
States open to competitive bids for natural gas are shown in the following map. These also comprise most of the high population states with limited activity in California, principally behind Pacific Gas & Electric in the northern part of the state.
Where states and utilities have deregulated commodity supply, consumers can request quotations from independent marketers. However, all consumers continue to be subject to distribution and demand charges assessed by utilities. With natural gas prices at close to historic lows – and electricity prices also low – the distribution and demand charges have become a higher percentage of consumers’ overall utility bills.
Note that most large industrial and commercial consumers have a choice of having their commodity included on a consolidated utility bill, irrespective of whether the commodity is purchased from a third party supplier. Consumers may opt for separate billing from marketers and the utility (which will continue to bill for distribution and demand charges). In Texas electricity consumers will receive a consolidated bill from the third party marketer that will cover not only commodity charges but the utility’s distribution and demand charges as well.