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Make sure that you get the energy deal you want.
What's included in retail gas prices
If you choose to buy from a gas marketer, your gas service won't change. You will still get a bill from your distributing utility which will indicate a regulated Delivery Charge - about 2/3 of your bill that goes to the utility, and a Gas Supply Charge - the remaining 1/3 that goes to the gas marketer you chose. If you also have rental equipment or a service contract, these will appear as well.
This cost split is a key point to remember when you are comparing costs. The suppliers, brokers and marketers are only offering rates on about 1/3 of your bill. The distribution charge, which is 2/3 of your bill, is fixed and regulated by an Energy Board or Public Service Commission. As a result, when a promotional message claims a 10% saving, it is referring to 10% of the 1/3 controlled by the energy marketer.
Example: A typical annual gas bill is $900. Two thirds of that, $600, is a fixed distribution charge. The remainder, $300, is the gas supply charge. A gas marketer offering a 10% saving is offering a saving of $30, which is 10% of the $300 gas supply charge. The saving on the total gas bill is 3.3%, which is about $30 saving on a $900 gas bill.
Regulated Rates Are Not Fixed Rates
Each province or state has an agency that regulates utility rates. In Canada it is a provincial Energy Board. In the U.S. it is a state Public Service Commission.
Utilities can and do apply changes to rates retroactively! By signing up with an energy marketer you can avoid these unexpected rate changes.
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