Energy Shopping: Apples to Apples

apples in a wooden box

When we buy things today, our first consideration is usually price. There are so many tools out there to help consumers with shopping and getting the best value. But what is out there regarding shopping for natural gas or electricity? What are the right questions to ask when shopping for energy? How do you know if the price you’re getting is fully fixed?

The first place to start when shopping for energy is with your local utility. Knowing your utility’s current price to compare (PTC) is imperative when comparing with other suppliers. In some states, utilities are required to post their PTC. Here, we will explain how to look for the PTC and how to shop for energy.

Know Your Utility Price to Compare

Some utilities make it easy to look up their PTC. It may be on your bill or on their website. Now, the PTC on a bill may be an old price because some utilities change pricing monthly or quarterly. It may be best to look online or call your utility to ensure you are getting a current and accurate number.

Understanding the Measurements of Gas

While each utility may give you pricing as CCF, Therm, or MCF, all of these measurements are at your meter. Converting units isn’t straightforward, but all you really need to know is to make sure you are comparing the same units to the same units.

What to Look for When Comparing Electric Pricing

When it comes to electric pricing, you will need to find out what is included in the price. In Pennsylvania, there is a tax called gross receipts tax (GRT) (definition below). Some utilities include this in their pricing. If you receive a price from an alternate supplier, you will need to know if it includes GRT. This way, you can see if your price is higher or lower than the price to compare.

What to Look for When Pricing Gas and Electric

Make sure you understand the terms of your price and how long it is locked in. You’ll likely want to lock in a gas price through the winter to protect your rates during the months you use the most gas. Similarly, you may use more electricity in the summer for air conditioning and want to ensure that you lock your rate through the summer. This means your price will still be protected if you use more or less than your historical usage. If your contract has a swing tolerance, you may be charged extra if you use significantly more or less energy during any given month.

Lastly, when the price is low, make sure all components are fixed. Sometimes, suppliers will state that all components are fixed, but only a portion is fixed; for example, it could be just the commodity and not the transportation. You should also know if there are termination charges and, if so, what those would total.

You can also ask to look at the contract. This should have everything outlined for you. Don’t be afraid to ask questions. It is essential for you to be well informed as the customer and companies appreciate questions as they prevent uncertainty or issues in the future.

Definitions

Centum Cubic Feet (CCF) – Centum Cubic Feet – 100 Cubic feet of gas.

Therm – 100,000 BTU. 1 Dth = 10 therms.

One Thousand Cubic Feet (MCF) – MCF is an abbreviation for a thousand cubic feet of natural gas.

Dekatherm (DTH) – It is equal to 10 therms or 1,000,000 British thermal units (MMBtu)

Gross Receipt Tax (GRT) – Gross receipts tax (GRT) Pennsylvania imposes a tax for electric energy used. Some utilities include this GRT in the Price to compare. GRT charges on generation supply, including both electric distribution (EDC) and the supplier’s gross receipts from the sales of the generation supplies to the consumer. These charges are then passed on to the consumer.