Deregulation in Pennsylvania

by Donny on January 3, 2012

Pennsylvania is one of several deregulated states. The average person might think, “so what?” or “who cares?” or even, “what the heck does that mean?” so allow me to attempt to explain. Deregulation opened up competition among the energy companies, allowing you to choose the cheapest provider servicing your area and allowing the companies to compete among themselves for your business. This gives you the consumer the ability to shop and compare multiple rates before signing up with the best energy prices for your home or office.

An article put out by Penn State University in 1996, just two years before Pennsylvania customers were allowed to shop for their own providers, pointed out the fact that several energy companies were already merging and would continue to merge after deregulation took its full effect. The article was right on when it said that and predicted the price of energy would be consistently changing because there’s no guarantee the companies can make a profit, especially since they’re only competing against each other. It also nailed it right on the head when talking about the options for providers, and not just electricity, but also gas and other forms of energy.

Because energy deregulation isn’t in every state, it can take time getting used to, which is why it’s important to consider the following when switching over to a deregulated system:

• Keep track of how much electricity you use, and your major source of usage.

• Estimate the costs of your electricity usage for various uses of your home. If your home heating or cooling system is running too much, consider decreasing the usage, and the rates will naturally decrease as well.

• If possible, use natural sources more, such as the sun and win to help heat and cool your house, and minimize electronics as much as possible.

These three things are extremely basic and common sense. They don’t even scratch the surface of things you can do to save money. However, as already mentioned, if you are moving to a deregulated area, the best place to start is by comparing the rates of multiple electricity companies in your area then sign up with whichever one has the best deal.

Some people are willing to pay little more money for environment-friendly energy. A lot of people argue coal energy pollutes the environment and are therefore strong proponents of wind energy, gas or another source of energy.

In fact, an article put out by members of Central Michigan University states that unlike most other states, Pennsylvania has strict environmental conditions which serves as a disadvantage for the electricity companies competing in the deregulated areas, forcing them to drop their rates. The fact that coal and other forms of “dirty electricity” play a major role in the state’s energy department doesn’t do any favors when it comes to these environmental rules. Then again, however, coal does provide a significant amount of electricity to Pennsylvanians, and because of its abundant supply, can serve as a major asset and decrease the cost of electricity.

Renewable energy such as wind and solar energy is believed to be the cleanest. That may be true, but it’s also not exactly the most reliable. If there is no wind, you will be less likely to have the wind power necessary to power up your home. In fact, according to an article written by a student at Duke University, wind energy is only responsible for 2.5 percent of electricity production in the United States.

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