Some advantages of electric rate comparison include finding which rates are the most current and which pricing options are best. An important decision is whether to sign up for a fixed or variable rate.
The objective of rate comparison and shopping on the market for various rates is to save on a yearly basis. Energy rates fluctuate through the year from company to company, and it is sometimes difficult to choose an electric service provider. The benefit of a fixed plan is that the rate is locked in for a term length that the customer agrees to. Usually these contracts have a duration of six to 24 months. This allows for more accurate predicting of monthly energy bills based on known energy usage. The downside of choosing a fixed plan is that with many providers, customers are not eligible to receive the lowest price if the price drops during the contract term, and attempting to cancel the plan early may result in termination fees.
The benefit of a variable rate is that it allows the customer to have the most current rates based on market conditions without a contract or termination fee. However, when rates rise, customers are subject to those increases.