Electricity Facts Labels are confusing for many consumers. There is much more to think about than just the price you will pay per month for your electricity.
Many companies offer what appear to be low priced residential electricity rates but upon a closer examination it may not be an attractive offer. Many customers see the rate but they never take time to read the energy facts label. The devil is in the details an he is dancing in the Electricity Facts Label.
Important Electricity Facts Labels Issues
- Late Fees – What are the charges that the contract allows the provider to charge if the customer is late. If the late fee is outrageous your savings per kWH just evaporated.
- Deposit – What is the amount of the deposit and can the provider increase the deposit required if the customer makes late payments.
- Termination Date – What are the electricity provider’s policies when a contract expires? Traditionally they will transfer the account to a variable rate plan and the rate can possibly double.
- Expedit Fee – The fee that is charged to have the electricity delivered rapidly?
These are just a few examples that are covered in your energy providers energy facts label. As you see, there is a lot more to a company than cheap residential electricity rates. If one company offers 10.2¢ per kWh and the other offers 9.9¢ per kWh the average consumer would jump on the lower price.
However the late fee for the lower offer is 21% with a requirement that if the customer is late they also must pay an additional $165 deposit and the more expensive offer is 18%. If the customer uses 1,000 kWh a month the payment for the more expensive option was $3.00 higher. With the lower price per kWH option if you are late you will have and late fee $2.97 higher plus need to make a deposit of $165.
As you can see it is very important to read the Electricity Facts Label. Don’t only focus on the rate. You could be saving $3.00 a month and paying a lot more.