Avoid these mistakes when shopping for electricity and natural gas
Shopping for electricity and natural gas might seem like an easy enough task, but there might be more to consider than you think. Buying electricity can get complicated fast, since you have to consider energy contracts, energy plan types, the fine print on those contracts and more.
We’re here to make things a little easier for you – read on to learn about six common mistakes people make when they’re buying electricity and natural gas, as well as a few helpful tips that’ll help you minimize energy costs and, of course, help you choose the right energy plan.
1. Not comparing energy providers and their rates
You’ve decided you want to purchase electricity and natural gas from a new energy provider – now what? While it can be tempting to go with the first provider you think of, that’s not the best idea.
It really pays to do your research when you’re choosing energy plans. By finding out which gas and electricity companies are in your area and comparing all of their available plans, you’ll be able to find the best energy rates for your home or business.
2. Being afraid of contracts
A utility contract can sound daunting – after all, agreeing to receive your electricity or natural gas services from the same company for one, three or five years sounds like a long time. But when well-done, contracts can prove to be advantageous for homeowners and businesses.
For example, if you select a three-year fixed-rate contract for your electricity, you’ll pay the same rate (kWh) for electricity for three years. You’d be able to budget around your utility bills consistently, plus you’d be protected from any spikes in the energy market.
Many competitive energy retailers will often let you exit a contract early without penalty if given reasonable notice (usually 15-30 days).
3. Not reading contracts before you sign
Phone. Internet. Cable. Regardless of what your contract is for, you should always read them carefully. Contracts contain important information pertaining to how much you’ll be paying per month, how much early exit fees are (if there any) and how the energy rates you’re paying will be affected by energy outages.
Reading your contract is the way to go if you want to stay on top of your energy management game and avoid being surprised by unexpected charges in the future.
4. Not knowing the difference between regulated, fixed and floating plans
If you’re not aware of the types of energy plans available for your energy needs, chances are you’re not going to be able to make an informed decision when you decide to move to a new energy plan.
The regulated rate option plans, also known as RRO, are what you get if you don’t choose a retailer at all, meaning you will be signing up with the default provider in your area. In this scenario, the rates are determined by the local utility commission and they vary from month to month. In Alberta, for example, the Alberta Utilities Commission regulates the utility market.
Fixed-rate plans allow you to pay the same rate for your energy for a set number of years (usually one, three or five years).
The price of floating-rate plans varies from month to month based on the current market situation.
You can learn more about the differences between fixed- and floating-rate plans here.
5. Going with the go-to electricity and natural gas company in your area
The idea of letting the go-to electricity and natural gas company in your area handle your utilities automatically might seem like a good idea – especially if you’ve never changed providers before.
Still, that’d mean passing up the benefit of being able to research the market and choose your own competitive electricity or natural gas retailer. By choosing who provides your electricity or natural gas services, you can save a significant amount on your energy bills each month.
6. Not knowing what will change once you sign up with a new energy supplier
It sounds silly and obvious, but you should be aware of what changes with your services once you sign up with a new energy supplier.
Some things won’t change – distribution and transmission costs will be the same between all energy retailers in your area.
Other things like the duration of your plan and admin fees most likely will – keeping yourself informed of such changes will help make your transition to your new energy supplier a lot smoother.
Choose a new energy plan
Hopefully by now, you’ll have a good idea of how to avoid common pitfalls people face when it comes to selecting energy plans. If you’re now wondering where to buy electricity from, a good place to start is by finding out what energy retailers are in your area and comparing the available plans to one another.
Thankfully, you don’t have to do that all on your own – sites like EnergyRates.ca can help you compare electricity and natural gas rates in your area.
EnergyRates.ca is a free and unbiased energy rate comparison tool that you can use in Alberta, Manitoba, Ontario, British Columbia, Saskatchewan and Québec, regardless if it’s for your home or business.
All you need to do to find the best energy rates in your area is fill in the form above – it’s easy and free!