New Jersey’s electric utilities are about to open their markets to competition, and consumers will have the chance to find an energy supplier offering lower rates and/or attractive combinations of energy services.
How can you evaluate different offers? What types of questions should you ask to make sure that the deal you get is the one you expect? Here’s an energy "shopping list" from New Jersey’s Division of the Ratepayer Advocate to help you become an informed consumer.
BEFORE YOU CHOOSE AN ENERGY SUPPLIER . . .
* Review past utility bills. Know your pattern of electric usage over time and how much you have been paying. Note whether there are significant differences in your seasonal or time-of-day use of electricity.
* Call your local utility for an enrollment package. The energy choice enrollment package will include, among other things, a list of licensed suppliers offering service in your area, your specific electric usage profile, and information that will help you compare offers from different suppliers.
* Collect and read offers from several suppliers marketing in your area. Don’t jump at the first offer. Become familiar with different offers and the terms that energy suppliers use.
* Consider your objectives. Do you want to maximize savings? Is reducing air pollution a priority for you?
* Learn more about energy buying groups. Your town or an organization to which you belong may form an energy buying group that offers residents or members lower electric rates if they join. These buying groups, or energy aggregation groups, may provide the opportunity for small customers like yourself to achieve additional savings.
ONCE YOU’RE READY TO "SHOP" ...
* Insist on receiving a written copy of the supplier’s agreement, including price, terms and conditions. The agreement will include important information about the rates and services being offered, as well as terms and conditions. If you are not fluent in English, ask whether the agreement is available in another language.
* What is the length of the agreement? Also ask whether the supplier will send you a notification at the end of the agreement. New Jersey prohibits automatic renewal of energy contracts, but if you fail to take any action, your supplier will continue to provide you with power on a month-by-month basis.
* What will my electricity cost? Many of the answers to these questions will be contained in the supplier’s agreement. Ask:
- What is the cost per kilowatt hour (kWh)?
- How long will the advertised price remain in effect?
- How much will I save compared with my local utility’s rates (i.e., basic electric service?
- Is the percent savings claimed based on your total bill or only the cost of the electricity (apart from the cost of sending the electricity to your home)?
- Does the rate I pay depend on when I use electricity (time-of-day or seasonal rates) or how much electricity I use? If the supplier’s rates change based on how much electricity you use , then the supplier must provide a detailed customer bill comparison which illustrates rates for use of 250 kWh, 500 kWh, 1000 kWh and 2000 kWh.
- Does the supplier charge any additional monthly fees?
- Does the supplier offer optional services, such as energy conservation or appliance servicing? Make sure that you understand each separate charge.
* Are there early cancellation or termination fees? Residential customers are always free to change suppliers or return to their local utility for service. However, they will be subject to any early cancellation fees contained in the agreement they sign with their supplier.
* How will I be billed?
- Can I choose to receive a separate bill from the energy supplier?
- When will I receive the bill?
- How quickly is payment due?
- Is there a deposit required?
- Is there a late payment fee?
- Is a budget billing plan available to equalize my payments over a set number of months?
- Can I pay by credit card or over the Internet?
* Ask about "green power." New Jersey’s new energy law requires electric suppliers to provide an "energy label" that lets you know the source of the electricity and the level of certain pollutants associated with its generation. This information can help you choose a supplier that provides "greener" or "cleaner" power.