Received mail touting low introductory rates? Watch for a switch to variable rates.

Recently, many Mainers have received multiple mailings from new Competitive Electricity Suppliers in Maine.  These mailers tout low, fixed introductory rates, usually for 6 months.

What these mailer don’t highlight is that these rates become variable after the introductory  period. Under variable rate plans, consumers in other states have seen their power bill go up  300%.  This tends to happen during periods of peak demand, such as colder winter months or hotter summer months.   Here is a story out of Pittsburgh that includes information about a company now doing business here in Maine, New Hampshire and Mass.

Overall, electricity rates are expected to be higher in New England through early 2015. Demand for natural gas, the primary source of electricity production, will continue to see very high peak periods.

At Provider Power we do things differently.   We purchase all of our customers’ power for the duration of their contract, at the time of enrollment, at a fixed price.  Since customer’s have a known fixed rate for their electricity they are not affected by pricing variations.  In energy markets that experience periods of very high peak demand, variable rates can skyrocket-something our customers never have to worry about.

If you or someone you know receives these kinds of mailings, make sure you know the full story. Competitive Electricity Supply companies offering these artificially low introductory rates are counting on consumers not paying attention to their renewal notices when the 6 months are up so they can move them to a variable rate product.

We don’t believe that variable rate plans are in the best interest of the consumers.  While this might be a viable option in some regions of the county, here in the Northeast, where weather is unpredictable and natural gas prices fluctuate greatly, real time energy costs in the winter and mid summer can be exorbitant.

Posted on May 8, 2014 in Electricity Maine

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