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Mistakes to avoid when choosing a new electric provider

By Jeff Cocking

There are many reasons why you may want to revise your electricity plan and choose a new electric provider. You may have realized your electric provider has been charging more than market average, or you want to take advantage of competitive suppliers in your area to get the best energy prices.

When it’s time to jump ship, you must choose a new electric provider that ticks all your boxes. But this is often easier said than done, especially in a deregulated state like Texas, where many electricity providers compete. Texas electricity providers are in the hundreds — roughly over 120.

With so many options, comparing and selecting electric providers can be overwhelming, and you could end up making some commonplace mistakes, as many Texas homeowners have. But worry not.

Power Wizard will help you select the most suitable electricity provider in Texas and the best electricity plan for your domestic needs. This way, you’ll skip the hassle of finding and comparing Texas electricity companies and plans yourself.

Benefits of switching to a new electric provider

The advantages of changing to a new electricity supplier vary depending on the gains you seek and the setbacks that prompted your switch. For instance, if your old provider had poor customer service but offered fair prices, your new provider would ideally provide you with better customer service at the same price point.

Overall, these are the four main benefits you stand to enjoy:

  1. Better electricity prices: Deregulated states like Texas enjoy healthy competition among providers. Hence, new providers can offer you better rates to get your business.
  2. Improved customer service: A new electric provider can offer you a better customer experience to maintain you as their customer. This is often the differentiation point that new providers leverage to win customers.
  3. More efficient management of electric bills: Today’s electric providers are transparent about their rates and fees. This helps you make sense of your actual energy costs.
  4. Green energy appeal: New electric providers are big on green energy, seeking to deliver power using more environmentally friendly options instead of fossil fuels.

Ultimately, you decide which benefits fit the bill. But it’s not as straightforward a choice as it sounds. If you’re not careful, you may choose a less than ideal provider or commit to a teaser electricity rate that short-changes you down the line. To avoid such pitfalls, you should know what mistakes to avoid.

Common mistakes made when choosing a different electric provider

These are the four typical mistakes you may be prone to making.

1. Making a decision that’s not based on your current energy consumption

Once you start reaching out to competitive providers, you’ll get multiple quotes priced differently. At this point, you’ll face a new dilemma. How do you know which quote gives you the most value?

The most structured way to answer that is by comparing the quotes to your most recent electricity bill. This way, you’ll pick out the quote that offers the most cost savings.

To analyze quotes objectively, you must understand the standard rate structures on which suppliers base their pricing options. These are:

  • Fixed-rate: A fixed rate means your energy prices remain constant for the life of your contract. Market price changes will not sway your unit price per kWh.
  • Floating or variable rate: A variable rate means your electricity prices will fluctuate every month. Your unit price per kWh is determined by your provider.[please see comments in v1 and v2 concerning floating.]
  • Time-of-Use rate: A rate based on different times of the day or days of the week.
  • Bill Credit: A monthly credit if you meet specific usage criteria.

If the rate structure isn’t clear from the quote, call the electric provider and find out more. Having all the costing details well outlined before making a decision empowers you to pick the best offer.

2. Picking a complicated plan

Generally, electricity plans in deregulated states are complex and vary among providers. In Texas, they get a little more complex. Texas electricity providers follow a strict code of rules set by the Public Utility Commission of Texas (PUCT), which requires them to show electricity plans based on 500 kWh, 1,000 kWh, or 2,000 kWh usage levels.

Texas electricity providers must include an Electricity Facts Label (EFL) revealing their plans’ finer details. Thus, your ability to read and understand the EFL influences how good a plan you get. EFLs are often complicated, and you may need an expert like Power Wizard to help you grasp the details.

You’ll also find providers offering plans like time of use (TOU) and free bill credits. TOU electricity plans determine the cost of electricity based on when you use it. In a bill credit electricity plan, providers offer you a free bill credit if your monthly electricity usage remains steady.

The different Texas electricity plans are confusing and take some getting used to. Thankfully, Power Wizard can help you make sense of these complicated plans, so you pick the most viable without getting lost in the details.

3. Choosing without comparing energy suppliers

It’s never a good idea to go with the first competitive offer you get from a new electric provider. You should weigh all your options before making a decision. After analyzing each electricity plan from different providers, select one with the most cost value using your current plan as a benchmark.

4. Going in without an understanding of the energy market

At the very least, you should understand how electricity producers, utilities, and suppliers interact in the energy market. Suppliers generate power and send it to the utilities, who then distribute the power over the grid to make it accessible to you. The providers then sell the power to you.

As such, when you change your electrical providers, only the energy rate and customer service will change. Your local utility company will remain intact, as your next supplier will still rely on their equipment — such as wires, transformers, and meters — to deliver power to you. This means your electric bill’s distribution costs will be consistent no matter who you switch to. Only the supply costs will vary.

Indicators that you should switch your electricity providers

Swapping your electricity provider only affects the energy rates and customer service. Therefore, when your energy bills constantly rise, it may be appropriate to start shopping for electricity plans with better rates. Also, if you receive bad customer service from your current supplier, you can decide to pull the plug on them and find a more responsive alternative.

But if you’re having problems with the equipment or experiencing power outages, it’s not an indicator to change your electric provider. Such issues are beyond your provider’s scope because your utility is responsible.

How you can make choosing an electric provider a seamless experience

With the different electric providers offering you competitive rates, settling on one provider can be a tricky experience. But that’s if you do it alone. When you partner with a top energy empowerment company like Power Wizard, you’ll enjoy a smooth transition because we’ll do all the groundwork for you.

Why Power Wizard?

At Power Wizard, we go the extra mile to find you a new electric provider and an electricity plan that suits your needs best. You can utilize our DIY shopping tool that consolidates selected electricity plans in one place to make it easier for you to find your ideal provider. Or, you can use our Enroll Me service that tracks your current electric plans and signs you up for a new contract at expiration.

Or better yet, enjoy our white glove service where we do everything for you — including shopping for new electric providers, comparing rates, signing you up for contracts, and tracking your customer experience to ensure you’re always satisfied with your electricity plan.

Find out how much you can save on electricity costs by leveraging Power Wizard’s calculator tool and other offerings.

 

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