Deregulated electricity markets have ushered in an era of change for many energy consumers around the country. Those fortunate enough to own property in these regions are given the unique power to choose where their energy comes from. Customers are given control over the type of rates they receive, the length of their plan, and most importantly who their supplier is. While this movement has brought great opportunities in many states, for the millions of customers impacted by electricity deregulation, it can also bring come confusion.
These deregulated energy plans not only come with more flexibility, but they come with different contracts as well. These contracts use a different type of jargon than standard energy contracts and chances are most consumers will be faced with new terms and documents that seem completely foreign. Here is some insight into the most important documents that accompany today?s deregulated electricity plans.
Electricity Facts Label (EFL)
Prior to signing up with a new energy plan, consumers need to read a document known as the Electricity Facts Label (EFL). This is an important part of any energy agreement as it details how the energy plan actually works.
Upon further inspection of the EFL, consumers will see that the document breaks down the exact cost of the electricity, by kilowatts per hour (kWh). There is likely also a section in the document that breaks down the cost per kWh from the REP, or the retail electric provider, and information on the cost from the transmission and distribution utility (TDU).
Other fees will be detailed including additional monthly costs, early termination fees, monthly base charges and more.
Terms of Service (TOS)
Any consumer considering signing up for a new electricity plan also needs to read the Terms of Service (TOS). This document is the actual binding contract between the consumer and the retail electric provider.
In this document, consumers will find information on how the service is provided, the length of the contract in question as well as important terms and conditions that the consumer should be aware of.
Part of the Terms of Service agreement also includes information on what happens at the end of the contract. Since these electricity contracts are all set forth for a certain amount of time, certain regulations need to be put in place for when they come to a close. The TOS will let the consumer know that the retail energy provider must let them know their contract is expiring within 30 days of the expiration date.
When a contract is about to expire, customers have the opportunity to switch plans or providers within two weeks of that expiration date without any penalties. Otherwise the contract will roll over with the existing provider.
Your Rights as a Customer (YRAC)
Every consumer entering into a new contract has a certain number of rights. In the Your Rights as a Consumer (YRAC) document, this information is detailed in great length. Most of these documents will include information on what the REP can and cannot do.
This disclosure will likely state that a REP cannot refuse service based on gender, religion or race.
These providers are also not allowed to switch customers to another provider without the customer?s consent, this is a practice known as ?slamming.? These companies are also not allowed to participate in ?cramming? or the process of charging consumers for services they did not authorize.
These documents also contain information on the consumer?s right to have their information safeguarded by the REP they are using. Most YRAC documents are essentially the same, but it is important that consumers know what they entail before signing any agreement. This information may come in use, should a consumer partner with a dishonest REP and feel the need to pursue legal action.
Understanding these three important documents and what they mean as detailed in a new contract can help deregulated electricity consumers all over the country stay better informed about the choices they are making and the agreements they are entering into. With general insight into electricity deregulation and a solid understanding of these terms and conditions, any consumer can shop through one of these markets with confidence knowing they are equipped to make the best choices possible.