Understanding Electricity Rates in Illinois: Illinois residents have had the legal right to choose their electricity provider for more than two decades. Under the state’s energy deregulation law, you can choose your energy provider, thereby potentially reducing your energy costs.
Cliff Haefke, director of the Energy Resources Centre at the University of Illinois Chicago, explains, “If you shop with a different provider, you can frequently reduce your overall electricity bill.” However, you, as the householder, must do some research to determine who these various electric providers are.
There is a great deal of risk involved in transferring energy providers; therefore, you should investigate all of your options. According to the Citizens Utility Board, a non-profit whose mission is to assist people with their energy bills, Illinois consumers have lost more than $800 million to alternative electric suppliers in recent years. Therefore, in the current electricity market, the regulated utility is likely your best option. Before signing up for an electricity offer, be sure to ask pertinent questions and read the fine print.
What is energy deregulation, what types of energy plans are available in Illinois, and how do I locate the best rates?
Electricity shopping in Illinois
The table below compares the current rate to be compared — the standard rate offered by your utility company — to the price range of options offered by Choose Energy, which is owned by the same parent company as CNET.
All displayed rates are accurate as of 22 June 2023 for 60002 (ComEd) and 60911 (Ameren) ZIP codes. The staff updates these rates on a regular basis, but they may have changed since the last update. Please enter your ZIP code at choosenergy.com for the most up-to-date rate information in your area. These rates reflect only the supply fees, not the utility’s delivery fees or any applicable taxes.
What does deregulation in Illinois entail?
In 1999, Illinois enacted a bill to deregulate the energy industry, which went into effect for every energy customer in the state by 2002. It is one of 29 states where residents can choose their energy provider. What does this entail? Homeowners obtain electricity through a network of three entities: transmission lines that carry electricity, utilities that distribute electricity to homes, and suppliers that generate electricity by burning fossil fuels or utilising solar, wind, hydroelectric, or nuclear power. It is the final piece — the supplier — in which deregulation enables choice, as individuals are typically tied to their utility based on their location.
“A customer, regardless of where they purchase their electricity, will always pay the local utility for transporting the electricity from the larger grid to their home,” Haefke explained. “What can be purchased is the generational aspect. You can secure in various rates and contracts, including three-month, six-month, 12-month, and 24-month rates.
Illinois utility vs. electric supplier
Illinois is served by three large investor-owned electric utilities, in addition to lesser municipal utilities:
- Northern Illinois ComEd.
- Ameren in Illinois’s central and southern regions.
- A minor utility in western Illinois, Mid-American.
- While residents are obligated to use these utilities based on where they live, they can choose their energy provider and save money on their energy bills.
What utility plans are available in Illinois?
Illinois has three primary categories of electricity plans.
Maintain your utility
You are not required to choose a supplier, nor even encouraged to do so, merely because you have the option to do so.
Haefke stated, “You could remain with your local utility and they would provide you with electric rates.” The local electric provider, such as ComEd in northern Illinois, will include supply, transmission, and distribution in a single package. This is the simplest option.”
Comparison shop for a provider
While you are bound to your local utility and must pay its distribution fees, you can potentially save money by tapping the state’s energy supplier market. This will enable you to select not only the price of your electricity, but also the contract terms (ranging from three to twenty-four months) and the source of your electricity, such as nuclear or hydropower.
Utilise hourly market prices as leverage
Similar to the second option, you will continue to be bound to your local utility and pay its network fees. But if you monitor the amount of energy you consume at various times of the day, it may make sense to utilise the real-time market. During peak hours, such as the mornings before people depart for work and the evenings when they return home, electricity costs more than when the majority of people are asleep.
There are numerous nuclear power plants in northern Illinois. “Since these nuclear plants cannot be shut down, evening electricity prices are extremely low,” Haefke explained. People who work outside the home and don’t consume much electricity during the day, but are home in the evenings, may want to take advantage of the hourly pricing model for electricity.
How do you discover the best Illinois electricity rates?
Work is required if you want to choose your energy provider and potentially save money on your energy bills. The state of Illinois maintains a website with information on switching as well as a marketplace of suppliers that serve consumers of various utilities. The Citizens Utility Board provides resources to assist with energy expenditures.
“It comes down to the homeowner doing their homework and determining how far out they want to lock in pricing,” Haefke said. “If you choose a short-term lease of three or six months, you will have to go buying again. I’d rather not shop every three months; I’d rather stay with something a bit more reasonably priced and durable. Then, I only shop once, twice, or once every other year.”
There is also the question of fixed versus variable interest rates. “Fixed rates are easier to manage because it doesn’t matter when you use your electricity,” said Haefke. The variable rate could be advantageous if you are an astute energy user, are willing to modify some of your behaviours, and/or are not home during the day’s peak hours.
What should you consider when selecting an Illinois electricity plan?
There are several essential factors to consider when selecting an electric plan. The rate — the price per kilowatt-hour charged by an electric provider — is the most essential factor. However, there are additional nuances to consider. Some vendors may offer an attractive rate for the first month, but then raise it or convert to a variable rate. They may charge monthly fees in addition to the rate. Suppliers may also bind you to contracts ranging from a few months to two years in length. Be wary of any gimmicks or hidden fees (such as for minimal usage), and search for customer reviews or testimonials. The Citizens Utility Board has resources and can assist with energy expenditures, as stated previously.
How to change providers in Illinois
Changing your energy provider is relatively simple. With your utility account number and proof of residency, you should be able to engage a provider online or over the phone, and it will manage the rest. Note any early termination provisions. The Illinois HEAT Act prohibits supplier termination fees beginning in 2020.
