How Energy Deregulation Can Help the Environment

Has Your State Deregulated Energy?

wind power basics

Many state governments have deregulated energy within their borders – and many more are considering it. What does this mean and how does it affect you? If you live in a state that has deregulated electricity, natural gas or both, you can benefit from what consumers in others states have learned, including how to switch electricity companies.

Traditionally, your local utility has generated your electricity at a regional power plant, probably powered by a fossil fuel such as coal or natural gas. The same utility company transports the electricity through wires it owns and distributes it to homes and businesses in its service territory. Consumers have no choice of who serves them.

Deregulation breaks up this process so separate entities take control of different parts – and it adds another player, as well. An independent energy supplier, or provider, is added to the mix to buy the energy wholesale from any kind of generator it wishes, package it and sell it to customers.

States do this in the name of competition – the thinking is if providers need to compete for residents’ business, then prices will go down and benefit consumers. But a huge benefit of this change can be that now consumers have more of a say in what kind of electricity is generated.

Green Energy Can Be a Viable Option

Some suppliers offer a plan that is 100 percent wind energy, for example. This doesn’t mean that 100 percent of the electricity that comes into your house comes from the wind farm in the next county – it means that the supplier will buy the equivalent of 100 percent of the energy you use from the wind farm and that energy goes into the power grid in your area.

But the more people who choose this type of plan, the more energy in the grid that will come from renewable sources.

For those consumers who want to contribute to green energy but can’t afford the often higher supply rates, some companies offer partial plans where the equivalent of maybe 20 percent or 50 percent of your energy use would come from a renewable energy source. Even this smaller reduction in the reliance on fossil fuels can make a huge difference in the short and long run.

In states with deregulation, it’s pretty easy to research and switch to a new supplier online. What suppliers are available to you will depend on which ones have relationships with your utility – because you will still get service from your utility. It is the company you call if the power goes out or a line is down. Be sure to choose a supplier that offers green energy options at a supply rate you can afford to make the most of deregulation.

[Photo Via: Wind Power Basics]

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