The timing of locking in your electricity rate is very important. The key to this? The winter months! The lowest rates are during the winter months from October to March, especially if you get a plan that it at least one year long (12 month plan). This guarantees that you have a steady and stable electric rate for the whole 12 months.
Let’s say you sign up for an electricity plan for 12 months in October. By the time you are actually switched it will be November, and your contract will not end until the following year in November. This is the best case scenario for a customer who has signed up for a low electricity rate in the winter months.
The worst case scenario is a customer who is signing up for electricity in April-August. The retail electricity providers increase the rate during the warmer months due to high demand. As the temperature increases, so does the demand for it to keep the homes and businesses cooler.
So what if you the customer who is in the worst case scenario and comes up to Reliant Energy reviews their plan in the summer? If you are coming up for renewal and let’s say it is June, what do you do?
Option #1: If your electricity plan expires in May-August, you can let the electricity company put you on a month to month plan (variable plan) and you can wait until the weather cools down and the rates get lower, then switch.
Option #2: Notify your current electricity provider that you will not be renewing your plan. Then, find a 3 month plan that will be ending in the winter months. Example: If your contract ends in August, then you switch to a 3 month plan that will end in November. Once your 3 month plan ends, you can sign up with a 12 or 24 month plan to lock in your lower electricity rate.
Things to Know:
· Before you switch confirm with your current electricity provider when your contract expires to avoid any early termination fees (if applicable)
· Know all the facts about the electricity plan your are signing up with. When signing up, read the “Electricity Facts Label”. This document contains all plan information.