Glacial Energy Blog

History of Electricity Deregulation

Beginning with the 1978 Airline Deregulation Act, the United States started eliminating many layers of economic regulation that had placed industries under strict government overseers.  The latest industry to feel the forces of deregulation is electricity.

For most of the 20th century, one company generated the electricity, transported it to the local retailer and distributed it to homes and businesses. These companies became mini monopolies, operating in prescribed geographic areas subject to state and federal regulations. The lack of competition resulted in the price of electricity varying from under four cents a kilowatt-hour in Idaho to more than twelve cents in Hawaii.  

Under deregulation, electricity providers were broken into three parts:

 

The Power Generation Company, the actual power producer

who runs the power plants and sells on the open market.

 

 

 

The Transmission and Distribution Service Provider,

or TDSP, who owns and services the wires and meters, and

 

 

The Retail Electric Provider, or REP, who buys power

from the producers and sells it to users.

 

Residential and Commercial customers purchase electricity service from a REP that purchases power from a power plant and takes care of billing and customer service. The power itself is still transferred over the same power lines from the local TDSP, making the switch painless for consumers.

Similar to mobile phone providers, electricity deregulation allows multiple companies to compete for business in an electricity market. REPs compete on price, service and renewable energy options, giving consumers more choices and lower prices. Similar to choosing which company you use for your cell phone, residential and commercial consumers now may choose their electricity supplier.

Not all states have embraced electricity deregulation. Texas, Pennsylvania, New York, Illinois and several other states are leading the way in providing consumers more competitive options in energy providers.  Glacial Energy is a retail electricity and natural gas provider that serves over 20 states.

 

 

 

About Glacial Energy- Glacial Energy is one of the fastest growing national retail energy suppliers selling electricity and natural gas to residential, commercial, industrial, and institutional customers in deregulated markets across the country. Glacial Energy has the resources and market knowledge to provide customized quotes for your business or cost saving opportunities for your home. Learn more about Glacial Energy by visiting www.GlacialEnergy.com

 

 

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