Pennsylvania represents one of the newly deregulated electricity service markets and there are many electric companies in PA that want to offer you cheaper electric rates than what the current incumbent provider in your area is offering or charging you. If you are a commercial business or residential electric service customer one of the number one issues to come up when switching electricity companies has to do with deposit requirements.
Choosing a No Deposit Electricity Company in Pennsylvania
If you have a credit history that has not been established or simply have bad credit you will be asked for a deposit by a Pennsylvania electric company. They will want to know if you have a history of paying your electricity utility bills on time, if you have defaulted on payments and that sort of thing before taking you on as a new electricity customer.
In PA you will have your choice from among a few cheaper electricity providers like Cirro Energy and Dominion Energy over the incumbent providers in Pennsylvania which are PPL Electric Utilities, Exelon, PECO, and Penelec. Here’s how the process will work: what will happen first is you will see an offer for a cheaper Pennsylvania electricity rate than what you are currently paying. You will sign up, and you may be asked for a large deposit amount that could be as much as $500. If you are a good credit score customer there will be no deposit required. You are promised atleast a 10% savings compared to what you are currently paying the monopoly electric provider in your area.
At this point you might decide to rethink switching but what if you could waive that Pennsylvania electricity deposit by picking a company that specializes in offering no deposit plans and choices? There are a few pay as you go prepaid electricity companies that offer no deposit plans but this is not the best option. A prepaid Pennsylvania electric utility will charge you based on historical electric usage from last year or the previous tenant. This means that no matter how you use your electricity you will have to pay for the usage pattern of the previous tenant or history.
Don’t fall for pay as you go sells pitches that sign you up with only a $99 charge. These companies have not told you that in just a few weeks they will be asking you for an additional $200 – $500 or risk having your electricity service turned off.
A better choice than going with a no deposit guaranteed electricity provider in PA is to find a cheap traditional electric company that has a reasonable deposit amount. You will consistently pay a competitive rate for your electricity and you will get that deposit back at the end of your contract.
Questions and Answers About Pennsylvania Deregulation
What is a Fixed Electric Rate?
A fixed rate simply means the electric utility in Pennsylvania, Allentown, or some other PA deregulated city has hedged your electric service on the commodities market in order to offer you a price that will not change for the term of the contract.
What Fixed Rate Terms are Available?
Every Pennsylvania electricity provider is different but the most popular fixed rate terms you see electric utilities in PA offering are for 1 year, 2 year, and 3 years terms. This means that the rate will not change for 1, 2 or 3 years depending on the electricity term you choose.
What is the most Popular Fixed Rate Term?
Most people choose the 1 year fixed rate because the rate is currently cheaper than longer term electric prices and it isn’t a long commitment.
Why Would Someone Choose a Longer Term Fixed Electricity Rate?
The reason someone in perhaps Allentown PA would pick a 3 year fixed electricity price rather than a 1 year is because they want t insure their rate will not go up in price over the course of 3 years. Even if a 1 year price is cheaper than a 3 year price it could be that after that 1 year is up the consumer would have been better signing up on a 3 year rate because fuel and electricity prices went up during this time period.
Why are Pennsylvania Electricity Companies Only Now Becoming Competitive?
The government has created a price level to allow competitors to come into the PA energy market and compete with the monopolies on price. This will allow energy consumers immediate savings on their electricity usage. The sooner a commercial or residential electricity customer signs up with a competitive energy supplier the quicker they will see savings on their energy bill.
Deregulated Energy Market Cities in Pennsylvania
These cities in Pennsylvania will have the monopoly electric utilities rates frozen at a set level while competitive electricity providers come in to compete for your energy business. Both residential and commercial electric service customers will be able to save a substantial amount of money by choosing a competitive electric provider. Also many of the surrounding cities and towns in places like Philadelphia will also have their electricity markets deregulated and will be able to pick a cheaper electric company. The price freeze is scheduled for January 2010.