Shopping for Energy may save you money on your electric or natural gas utility bill, however, this is not always the case. Prior to agreeing to switch to a Third Party Supplier (“TPS”), it is necessary to become familiar with TPS pricing structures, important contract terms, and how to compare TPS price offers to the price you currently pay for gas or electric supplies (“Price to Compare”) from your electric or gas public utility. Knowing the Price to Compare, how this price can change going forward and the price the TPS is offering to charge you for electric or natural gas supply, will provide valuable information which will assist you in evaluating the TPS price offer. Moreover, it is important to understand the contract terms that the TPS is offering.
Once you sign up with a TPS they are required to provide you with a TPS Contract Summary, a standardized one-page summary of your contract that will highlight and summarize the most relevant contract terms. Before you shop, we recommend that you print out the linked TPS Contract Summary form and use this as a guide to ask the TPS relevant questions. This will help you find out important information such as: can the TPS’s fixed price turn to variable, is there a cap on how high the TPS’s variable price can go, how will any advertised savings be calculated, is there a cancellation fee if you decide to return to your utility and how long will it take, and what happens when your contract ends.
The electric power and/or gas suppliers must tell you whether the price per unit will be fixed, variable, or fixed for a portion of the contract and variable for a portion of the contract. Click on “Fixed v. Variable Rates” for a specific description of these pricing structures. You will also find important questions to ask about the pricing structure. In addition, when presented with a price offer, the price should include Sales and Use Tax so that you may compare the price offer to your electric or gas public utility’s Price to Compare.
You can find the Price to Compare on your most recent natural gas or electric utility bill. It is the price customers pay to their electric utility company, i.e. ACE, PSE&G, RECO or JCP&L, or their gas utility company, i.e. NJNG, ETG, SJG, or PSE&G, for the supply portion of their utility bill. It represents the portion of the utility bill that will be replaced by the charges of a Third Party Supplier if a customer switches to a third party supplier. This section will describe what types of costs are included in the Price to Compare and how the Price to Compare may change.