Knock, knock, knock…
Hello ma’am. I’m here on behalf of Power’n’nem Electricity supplier. We are offering VISA gift cards and tickets to the see the Temptations Version 58 if you switch over your electricity.
Granny, I know it sounds enticing, but I need you to stop and wait. Don’t give anyone your electricity account number or change suppliers before reading this.
I had the opportunity to talk with a representative from one of these electricity supplier companies AND from my Utility company. Both were speaking off the record, but I want to share what I learned.
- The utility company is where the electricity comes from. They provide the lines and the equipment to bring the power to you. Because of this, the service doesn’t change. Outages will be the same, etc. The reliability of the service doesn’t change.
- The government allows companies to purchase and sell energy to consumers. They can decide the price-per-watt. This is in an effort to make electricity a competitive market, rather than a monopoly. Your electricity supplier is either your utility company or a private company. You can see who your supplier is on your bill. (It’s in the fine print.)
- The suppliers can provide the energy at a fixed rate or a variable rate and they have various contract lengths and terms for cancellation.
Some of the companies that go from door to door and offer incentives to switch are preying on the older population.
Some of these companies will entice people to switch but leave out the fact that the initial rates are not fixed. Then months later they can hike up the price-per-watt of energy. Some even charge large fees to cancel.
Some utility companies have put in place programs to help people get out of these contracts because they can be so pricey.
If you are considering switching suppliers, make sure you know these things:
- Know if the new rates are fixed or variable
- Know the length of the contract
- Know what early termination fees are in place
- It will also be valuable to know what your rates with your current supplier have been over the last 6-12 months. It is possible that your rates may be on the higher side today but 3 months ago, they were lower than the new company is promising at a fixed rate.
I’m leery of anything promised with a too-good-to-be-true incentive. Why are you giving me a $50 gift card? Am I going to pay more than that to switch this service? Maybe, or maybe not. Just do your research.