The Benefits of Customer Choice For Energy Consumers
At Star Energy Partners, we are strong proponents of consumer energy choice. In deregulated energy markets like Ohio and Pennsylvania, energy consumers have the option to choose where they purchase their electricity. Instead of operating in a monopoly, a deregulated system means that energy providers have to compete with one another to win consumers’ business, resulting in a higher quality of service and generally lower prices.
We believe consumer energy choice provides opportunities for consumers. And in the past few months, several studies have been released that back up our belief with raw data.
More than 17 million U.S. households are in deregulated territory, with an increasing number of suppliers competing for their business by offering a variety of innovative products and services, according to an ABACCUS study,. States that top the study’s list include Texas, Pennsylvania, New York, Illinois, and Ohio.
“The ABACCUS report underscores the value of allowing customers to shop for their electricity provider in terms of innovative products and services and increasing numbers of competitive providers vying for their business,” said COMPETE Counsel William Massey. “…workable retail electric competition can succeed when policy makers put forward a strong policy preference for competition. When this occurs…we see increasing numbers of competitors offering an ever wider array of creative new products and services.”
These findings are echoed in another study that we recently wrote about from COMPETE Coalition. This 20-year study found that energy consumers with a competitive energy choice benefit from better prices, investment, and reliability when compared to their counterparts in a monopoly energy system. Here are some of the highlights from this report:
- From 1997 to 2014, consumers with a competitive choice saw their prices rise 4.5% less than inflation, while customers in monopoly states saw their prices increase 8.4% over the inflation rate. Simply put, consumers in monopoly areas have to pay more than they would in a deregulated area.
- Between 2003 and 2013, accounts served by competitive suppliers increased 524% for commercial customers and 636% for residential customers. Energy choice is becoming much more popular, especially among residential consumers.
- From 2003–2014, electricity demand by competitive suppliers surged even during a period of flat growth in consumption and a national recession. Demand grew 181% for commercial and industrial customers and an incredible 673% for residential energy consumers.
Click here to learn more about the benefits of energy choice for consumers!
