How Does Electricity deregulation Affect You?

utility company

A utility company is a company which maintains the public infrastructure for a particular public service such as water, gas, or electricity. Public utilities are subject to various forms of regional public control and regulation including community-based organizations to statewide state-run monopolies. In some regions, the regulation of utilities is placed under the auspices of the public utility commission (PUC), while in others it is the local governing body that has jurisdiction. Private companies are also beginning to serve as utilities, although in this case they would be responsible for the large expenses involved in maintaining the infrastructure.

Utility Company

The rates a utility company can charge are regulated by the state. In most states, electricity suppliers can choose to adopt a rate structure which varies according to the usage and the average annual consumption of electricity produced. However, on an annual basis, most states require utility companies to charge the same rate to everyone who consumes electricity. In addition, customers can also switch their electrical supplier, if they wish, whenever they feel that they are getting better service or cheaper rate.

There are two main types of deregulation: deregulated and unregulated. A deregulated utility company is not bound to follow any federal rules or laws. They are allowed, however, to pursue innovative solutions to ensure that they provide quality services. Unregulated utilities are bound by the state to obey whatever laws are applicable. They are also able to charge their customers according to a prescribed formula. However, deregulation sometimes leads to competition between deregulated and regulated utilities.


Electricity markets across the country have undergone several changes. There was a time when all electric service providers were almost monopolized, leading to increases in monthly bills. However, with deregulation, energy suppliers can now compete more freely on price and the result has been cheaper prices for both consumers and energy suppliers. The result has been improved service and cheaper rates for both, which is exactly what most consumers want.

Most states in the US now allow deregulation, including Texas, which became the last state in the US to deregulated electricity markets in 2021. According to a study published by the Natural Resources Defense Council, deregulation resulted in dramatic increases in utility prices between 2021. During this period, natural gas prices in the US increased by an average of approximately 18%, and residential electricity rates increased by an average of approximately 4%. However, over the last few years, deregulated electricity prices have decreased slightly, while residential rates have remained relatively constant or fallen only slightly.


One of the positive results of electricity deregulation is that consumers are now able to use portable power sources such as solar and wind power, which are becoming increasingly popular due to their environmental benefits. However, many US states have still not re-regulated electricity suppliers, which means that you may still be charged more for electricity even though you have chosen a more environmentally friendly supplier. If your supplier still continues to charge you more after you have switched to a greener supplier, or if you still choose a more expensive power source despite having received substantial cost savings, then it is important to call your utility company and ask them why you are being charged more. They may tell you that the deregulation process was done because the supplier was able to save on their profits and reduce their emissions – both of which are true. The only thing you can do about this is to ask them for proof that they are using greener energy sources, and to show you a copy of their environmental impact report. If they cannot provide any evidence that they are currently using greener technology or that they have promised to use zero-carbon energy in the future, it may be time to switch back to your old power supplier.

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