The trick to finding the cheapest gas and electricity rates as a new customer may surprise you. No longer is it about sifting through the market for the provider who offers the lowest rate. Now, the best rate is based on your needs.
Since the energy market started to deregulate, gas and electricity providers have gotten a lot more competitive; however, that competition doesn’t limit itself to who can offer the lowest rates. If providers want to compete with each other, they need to offer the services that best comply with their clients’ needs—and that means, more and more, the cheapest gas and electricity rates for new customers are being shaped by you.
How does this benefit you?
You can choose your energy provider based on how competitive their rates are, but you can also search the market to find the provider whose plan works best for you. This means you can gain access to the level of rate security or flexibility you want—or you can find a mix of both features. When you are looking or the cheapest gas and electricity rates as a new customer to the energy market, you don’t have to settle for anything less than the rate plan you need.
How to find the rate that fits
Whether you are looking for gas rates, electricity rates, or a combination of the two, the most important thing to do in finding the cheapest rates is to do an assessment of your past and future anticipated usage. This will help you choose from among the =regulated, variable, or fixed rate options. Any one of these options may provide you with the lowest possible rates, but only if you know your specific consumption needs.
Why is it so important to know your needs?
The regulated rate option (now called the Rate of Last Resort – RoLR), the fixed rate option, and the variable rate option are each designed with specific benefits, but you need to know which of the benefits will afford your home or business the highest advantage.
As a new customer, you may not know your specific consumption needs yet. Once you’ve been living or working for a number of months in your current location, you will have a better idea of your regular consumption rates and how consistent they are. Until you know your consistent rate of gas or electricity consumption, the fixed rate option, while it does offer low rates and will protect you from market spikes, may not be the best option. Locking yourself at a rate that doesn’t comply with your consumption needs isn’t going to get you the best prices, no matter how low those prices are. Until you know your average usage, you may be better off with a more flexible option.
Floating rates calculate their prices on the current market conditions of electricity. As a result, floating rate prices are typically low when the market price of electricity is low as well. Conversely, floating rates can spike when the market price is higher. Floating rates are ideal for customers who are looking for some flexibility as well as the lowest rate possible. However, customers should be comfortable with potential price spikes.
The Rate of Last Resort (formerly known as the RRO) has a set rate for a two-year term. At the end of the term, the rate can only be adjusted by 10% for the next two-year term. Previously, the RRO used a monthly rate that was reflective of the current price of electricity. While this sometimes resulted in low electricity prices, price spikes did occur. The RRO reached high levels in the summer of 2023, peaking at an average of ¢31.486/kWh in August 2023. As a result, the Alberta Government sought to make the regulated option more stable, predictable, and affordable for Albertans. The solution was renaming the RRO to the Rate of Last Resort (RoLR) and restructuring how the rate is calculated. To learn more about the RoLR, check out our in-depth guide.
Contact us at Energyrates.ca for help finding the cheapest gas and electricity rates as a new customer in Alberta.
