Small businesses can save money on their power bills by shopping for low priced competitive electricity rates. However, according to the New Jersey Board of Public Utilities, under 20% of small businesses electricity users (under 500 KW demand) have entered into power contracts with licensed electricity suppliers.
When comparing electricity offers from licensed suppliers, business owners need to get the answers to a few important questions:
1. Does the offered rate include the entire price to compare?
JCPL posts their “Price to Compare” rates which are their default rates that customers are supposed to measure competitive offers against. The problem for business customers is that the laws do not prevent electricity suppliers from dicing up their offers to make the rate look low, and then passing through the additional charges on the bill.
The price to compare includes the entire energy commodity and transmission charges. A common practice is for electric suppliers to offer a rate that does not include the transmission charge (currently $0.006265 per KWh for small businesses). For example, lets say your price to compare is $0.10. You get an offer from a competitive supplier that is $0.093 that will save you 7% on your electric bills (Not Bad!). However, on the contract it states that the rate includes energy, but makes no mention of transmission. When your bill comes, you are actually paying $0.099265 ($0.093 + $0.006265) and are saving almost n0thing.
To avoid this type of scenario, make sure to ask for a rate that includes the “Entire Price to Compare”. Ask for it in an email so that you have proof.
2. Does the offered rate include SUT (tax)?
It is OK if the rate does not include the SUT tax, but you should no whether or not it does so that you can compare it to the right price to compare.
The current price to compare for JCPL small businesses is $0.109 (without SUT). With the SUT tax it is $0.116629. You don’t want to estimate savings by taking a competitive rate that does not include SUT and comparing it to the price to compare with SUT. This will create unrealistic savings expectations.
The bottom line is that JCPL small business customers can find nice savings on their electric bills of anywhere from 5-15% depending on the current market conditions. In this business environment, any savings is good savings. But in order to get those savings, you’ll need to spend a little bit of time reading over the electricity contract. You’ll be glad you did the leg work when you start seeing the savings on your monthly electric bill.
Here are some current JCPL Business Electric Rates: