Energy Tips

How to compare energy plans like a boss

Comparing energy plans for your business can be frustrating to say the very least.

Is my rate all-inclusive? Are there any hidden fees? How do I know? Base charges, nodal charges, delivery fees, variable rates – it’s a lot to take in. And on top of it all, unscrupulous suppliers, brokers, and scam artists have taken advantage of the complexity with their bait-and-switch tactics and outright scams.

Luckily, there’s an easy way to find the perfect plan without losing your shirt. If you know what to look for, how to compare your options, and which ‘great deals’ to run from, you’ll be on your way to making smart energy decisions for your business. Here’s a simple guide to help you navigate the rocky path to finding the perfect energy plan.

Hurdle #1: Hidden fees make plans hard to compare

The devil is in the details, as they say. Some plans are all-inclusive, while others have additional pass-through charges, so it can be difficult to make apples-to-apples comparisons between your options.

One plan may appear like a steal but turns out to be riddled with hidden fees and charges. Another plan may have a higher rate but turns out to be the lowest-cost option. It’s easy to get misled into thinking a lower advertised rate equals a cheaper plan. But it takes digging into the details of each plan to find out the truth.

‍The solution: Compare total monthly cost over rate‍

The easiest way to cut through the fluff is to compare plans based on their total monthly cost to you. At the end of the day, your goal is to find out which plan is the lowest-cost option for your business – with a provider who treats you well, of course.

Sure, you can bust out an excel spreadsheet, comb over a bunch of contracts, sniff out all the fees and charges, find a way to pull your usage history, and run the numbers. Whew. But, there’s no need to do that. These calculations are done automatically with a free GridBid profile. The app connects to your usage history, finds all fees and charges buried deep in those contracts, and builds an easy-to-read graph for each plan so you can see what it really costs.  

Hurdle #2: Energy rates fluctuate significantly over time

Energy costs rank in the top 3 expenses for most businesses, so a sudden increase in the price of energy can have a devastating effect on your budget. Plus, the market for electricity is one of the most volatile markets out there. Rates change every 15 minutes in response to weather patterns, current demand, reserve capacity, unplanned outages, and natural gas prices. The rate you were able to lock in for your last contract has no bearing on what you can find today. Prices today might be much higher or lower than last time, depending on what’s currently going on in the market.

So, how can you make sure you always pay the lowest possible price?

‍The solution: Keep track of the market and be proactive

Businesses who actively watch the market and react when prices are low routinely pay 20-30% less than businesses who only look at rates when their current plan is about to expire. Always keep an eye out for low prices so you can lock in your next rate when opportunity strikes. You can compare energy providers and question sales reps until you’re blue in the face, but if you don’t pay attention to changing conditions, you’ll always be at the mercy of the market. Stay on top of price movements by finding a reliable source, like GridBid, to occasionally send you updates. That way, you can manage your energy costs proactively rather than just taking whatever price is available once your current plan expires.

Hurdle #3: Sales reps can be misleading

We’ve all been pushed into a bad decision by a silver-tonged sales rep. And the energy industry has its fair share of relentless agents, telling half-truths while slapping a shiny bow on their snake oil energy plans. There are many agents that genuinely want to build relationships, solve problems, and help their customers find the best deal – the only problem is that it’s sometimes difficult to tell the two apart.

The solution: Ask the right questions & read the fine print

While there’s no surefire way to decipher between the good and the bad, here’s some helpful advice to help you wade the murky waters: 

1.    Always ask if the following components are included in the offered rate:

         - Nodal Charges

         - Line Losses

         - Ancillary Services

         - RECs

         - QSE Fees

2.    Ask if they charge a meter fee or a base charge

3.    Ask about the plan’s non-recurring fees

4.    Read the Terms and Conditions. If anything feels off, ask about it!

5.    Always make sure your plan is “100% swing” so you don’t get charged a penalty for using more, or less, energy than expected.

 

Conclusion

From hidden fees to less-than-honest sales reps, searching for the perfect plan can be tricky. Make sure you always ask questions, read the fine print, and try to determine what each plan will truly cost. If you’d rather skip all the drama, you can find custom plans from the top providers by creating a free GridBid profile. With our online marketplace you can instantly find the best rates – without the pushy sales rep. We only allow providers to offer plans that include all pass-through charges in the offered rate. Plus, all of our plans are 100% swing, and most don’t charge meter fees or base charges.

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