Deregulation of Energy: How Does the Deregulation of Energy Affect You?

What is the Deregulation of Energy?

Deregulation of energy is breaking up the monopoly that utility companies have enjoyed for over 100 years. Opening up the market for consumers to choose who they purchase electricity and natural gas, allows us to lower our electric and natural gas bills. The telecommunications industry had a monopoly on our local and long distance for over 60 years. If you recall At&t and Pac Bell were the only players in Southern California. Then the government stepped in and blew open the doors to "fair market." This allowed new companies to emerge and offer the same service we were enjoying, at a fraction of the cost.

How Does It Work?

To put it in a language we can all understand, these new companies "buy" electricity and natural gas from the local utility company. Then they are able to resell it to us(the consumers). The electricity and natural gas will still travel to our home or business as it did before. The only differences will be the price we pay and the company that we buy it from.

When we turn on a light switch, charge our cell phone, turn on our television, heat our stove, turn on the hot water everything will be the same. On the consumer side we will enjoy the same electricity and natural gas.

The Benefit of Deregulation of Energy

You might be asking, what is the benefit to switch? Price and customer service! Before deregulation of energy. The local utilities could hold us hostage. They could charge and treat us any way they wished. We saw this a few years ago in California with the "rolling black outs." Some people went without electricity for several hours. If that wasn't bad enough, the utility company charged us through the nose for the electricity we did use.

Having several companies to choose for our utility needs forces the utility companies to sell the commodity at a market price and more importantly it forces them to step up their customer service. For if they don't we have a choice to do business with someone else.

Summary of Deregulation of Energy

• US government is breaking up the monopoly
• We still enjoy the same electricity and natural gas as before
• Market pricing
• Greater customer service

All of the states haven't been deregulated yet. Here is a list of the ones that have and for which services:

Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Montana, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Texas, Washington D.C.

Natural Gas

California, Colorado, Florida, Georgia, Illinois, Indiana, Kentucky, Maryland, Montana, Nebraska, New Jersey, New Mexico, New York, Ohio, Pennsylvania, South Dakota, Virginia, Washington D.C., West Virginia, Wyoming

Stay tuned for your state. All of America will be deregulated. Freedom of choice. It's the American thing.

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