There is a secret in the electricity market throughout New Jersey that most people are not aware of. Simply put, a customer who gets their monthly electric bill from PSEG can reduce their costs by 12% this summer simply by participating in New Jersey electricity choice. Participating in electricity choice might sound intimidating, but it just means taking a few minutes to shop the market for lower PSEG electricity prices that are being offered by licensed electricity suppliers.
Despite the relatively easy process involved to save on PSEG electricity costs, the New Jersey Board of Public Utilities reports that as of April 2015 only 9.2% of eligible PSEG customers have taken action to switch to a competitive electricity supplier. There is a lot of fear and misunderstandings surrounding the true benefits of electricity choice in the PSEG service area, as well as the other major New Jersey service areas. The rate at which people are saving on electricity costs in PSEG is also lagging behind other large choice service markets. The two largest service area markets in Pennsylvania, PECO and PP&L, have switch rates that are three times and four times, respectively, greater than the PSEG switch rate. Similar and even greater switch rates are seen in electricity choice service areas in Maryland, Ohio, and Connecticut.
Part of the slow participation rate in PSEG is a result of a lack of eduction on not only the benefits of electricity choice, but the basic understanding that customers in PSEG even have the option to save on their electricity costs through competitive pricing. Other electricity choice states have spent money on marketing the existence and benefits of competition through mail advertisements, information websites, and in some cases even television commercials. New Jersey has not taken similar actions to educate their population. On top of that, there are thousands of electricity customers who have tried switching their supplier only to have a bad experience through rapidly rising electricity costs and poor customer service. In the early days of New Jersey customer choice, which actually started in 2003, their were only a few competitive suppliers who entered the market and most of them only offered a variable rate structure. Though these companies often promised lower PSEG electric bills, in reality the customer was signing an agreement to receive power from a new supplier at an unstated price. When the volatile energy market saw a spike, the variable price electricity supplier simply passed the costs to their customers. These actions left many long time New Jersey residences with the idea that electricity choice is bad and that staying with the PSEG basic generation service rate is the best solution.
Over the last five years the market has matured greatly, and now PSEG customers have the ability to lock in low fixed electric rates that can save them money on their electric bills. The 90% of PSEG residential customers who have not switched pay a default rate for their power supply which includes generation and transmission costs. Competitive PSEG suppliers are offering fixed electricity rates that are in some cases 12% lower than the default rate, which is also called the basic generation serve rate. Through the lower competitive prices customers can save on their PSEG electricity costs. Though the PSEG residential customer class has been slow to adopt to electricity choice, business customers have been quicker as 22.7% of all businesses in territory have switched suppliers. The switch percentages are much larger for bigger businesses, getting as high as 86.3% for the largest industrial facilities.
PSEG residential customers looking for an easy way to save money on their electric bills should take the time to compare electricity rates and choose a plan that best fits their needs. Despite the negative things that have been said about PSEG choice options, the fact remains that customers can lower their PSEG electric bill by as much as 12% and protect themselves from potential price hikes in the coming months. PSEG rate offers from licensed suppliers are listed below. Offers are updated in real time.