Finding the right home energy rate is not easy. But most people think that all they need to do is to pick the lowest rate among the many options available. Yes, picking the lowest rate may sound okay but you need to read the fine prints first. Also, a few more people will select the first plan that comes their way. If you do that, you may pick on an expensive plan. The majority of people who pick on the first plan that come their way end up regretting. Here are things you need to know when shopping for a home Energy Rates.
1. Suppliers have different rates
Different suppliers offer different rates depending on the terms of the plan. Each plan comes with different terms and unique benefits. In most cases, the terms are determined by the changing energy prices on the market. So, the first thing that people need to do is to assess the supply rate that works best for their homes. Some of the rates you may need to consider include:
Fixed rate
It gives the customer a determined rate per kWh. The rates are not determined by the lows or highs of the market. These rates may seem higher but they are better when you consider the stability they come with. They give you peace of mind and allow you to save some money. However, special circumstances may make it necessary to change the set rate
The variable rate plan
It moves with the direction of the market value of energy. It allows customers to benefit when the prices move down. Consumers on this plan must be prepared to pay more when the demand goes high. So, ensure you read and understand the variable rate plan before signing the contract.
Indexed rates
In this plan, the supply rate fluctuates over time. It follows a certain formula. So it is imperative you understand the formula before signing the contract. The plan offers customers different rates depending on the week, day and time. It allows you to choose the time to do the energy-intensive chores. Usually, the cost of energy is cheaper at night and at weekends.
Flat rate Plan
Customers are charged the same price for the energy consumed. If you know the amount of energy you consume per month, do the calculations and decide if the plan is ideal for you.
2. Determine the length of the term
Before you choose the length of your energy plan, you need to consider a few things. For instance, people who are leasing may select a term that corresponds to the lease duration. Homeowners will do well with a plan that is fixed but which runs for several years. Also, you may decide to go for shorter terms of three to six months. But you must be prepared to adjust your budget after the expiry of the period.
There are many other things you may need to know when shopping for an ideal energy supplier for your home. But the rates and the length of the term are the most important ones. They determine whether you enjoy the utility or not.