With a deregulated electricity market, Ohioans can potentially save a lot of money on their energy bills. But shopping carefully is key.
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Stephen J. Bronner is a New York-based freelance writer, editor and reporter. Over his more than a decade in journalism, he has written about energy, local politics and schools, startup success tips, the packaged food industry, the science of work, personal finance and blockchain. His bylined work has appeared in Inverse, Kotaku, Entrepreneur, NextAdvisor and CNET, and op-eds written on behalf of his clients were published in Forbes, HR Dive, Fast Company, NASDAQ and MarketWatch. Stephen previously served as contributors editor and news editor for Entrepreneur.com, and was the VP, Content and Strategy, at Ditto PR. He enjoys video games and punk rock. See some of his work at stephenjbronner.com.
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The law, enacted in 2001, allows most Ohio customers to shop around with different energy suppliers. (You're still locked into the utility company based on where you live.) Because of this choice, prices from both utilities and third-party energy suppliers have fallen compared to states without deregulation, the researchers found.
"Competition has driven down average electricity prices in deregulated Midwestern states (Ohio, Pennsylvania, Illinois), while their regulated peers (Indiana, Michigan, Wisconsin) have seen a steady increase in price of generated electricity," they wrote. "Ratepayers in these regulated states are saddled with the cost of aging, uneconomic power plants, while competitive markets in the deregulated states have incentivized investment into new efficient and cost effective generation and have accessed wider multistate markets for generated electricity."
While deregulation has provided Ohioans with big savings, it has also brought risks. There have been reports of unscrupulous companies onboarding customers with competitive rates, only to raise prices considerably when their contracts expired. Suppliers might also have high termination fees or other costs that aren't clear when you sign up. This is why it's essential to pore over the details of any contracts and watch out for any hidden fees.
Shop for electricity in Ohio
The table below shows the current price to compare -- the standard rate available from your utility company -- and the price range of options available through Choose Energy, which is owned by the same parent company as CNET.
All rates displayed are accurate as of June 22, 2023, for the ZIP codes listed with each utility. CNET staff regularly update these rates but they may have changed since the last update. For the most current rate information in your area, enter your ZIP code at choosenergy.com. These rates only represent the supply charges, not the utility's delivery charges or any taxes.
Deregulation is a big policy word for how the energy market is structured. For you, think of it as choice.
"Deregulation ensures that in Ohio residents have the opportunity to shop around for the best deal in the energy marketplace," said Nolan Rutschilling, managing director of energy policy at Ohio Environmental Council Action Fund. "So while a few large companies own and operate the electric grid, there's a vast number of suppliers who are selling power onto that grid."
There are some nuances in the law you should be aware of. For one, Ohio residents who live in areas served by municipal utilities or rural cooperatives -- about 6% to 7% of the state, according to Rutschilling -- are not eligible to shop for energy suppliers, although they may still benefit from the increased competition it has created.
"If a local government has passed an initiative to establish what's called community choice aggregation, they may negotiate on behalf of their residents a set price and plan for the residents of that municipality," Rutschilling said. "The residents of that municipality are then enrolled in that plan automatically, but have the opportunity to leave at any time."
Ohio utility vs electric supplier
Ohio is served by four major utilities. They are:
FirstEnergy -- The Illuminating Company, Toledo Edison and Ohio Edison -- which cover much of northern Ohio including Cleveland;
American Electric Power (AEP), which largely serves central and eastern Ohio, including Columbus;
AES Ohio, also known as Dayton Power & Light, covers the western part of the state; and
Duke Energy Ohio, which operates in the southwestern part of the state, including Cincinnati.
While you can't switch utilities, you can shop for an energy supplier.
What types of electricity plans are offered in Ohio?
You have the ability to shop for your energy supplier, but you don't have to if you don't want to. Here are your options.
Stick with your utility
If you decide you don't want to shop around for an energy supplier, you'll be defaulted into the utility's plan, known as a standard service offer.
"Each of the electric distribution utilities have what they call a standard service offer or the default offer," Rutschilling said. "So if you live in Cleveland and you sign up for FirstEnergy, it automatically defaults you into its standard service offering, in which rates are variable. People are not locked in at a fixed rate by default in Ohio."
Shop around on the energy marketplace
If you prefer to find another company to supply your electricity, you can compare different rates on the Public Utilities Commission of Ohio's (PUCO) Apples to Apples website. Once you choose your utility, you'll be presented with a table of different offers from energy suppliers that can be sorted by price, rate type, renewable content (Ohioans have access to nuclear, wind, hydroelectric, solar and biomass power), term length, fees and promotional offers.
How do you find the best electricity rates in Ohio?
On the PUCO website, "Sort and search by a number of different categories, including rate -- dollars per kilowatt hour, which is a great way of finding the lowest rates," Rutschilling said. "People should also look into other considerations, like, is the rate fixed? Is it variable? Is there a monthly fee? Is there an early termination fee if you want to leave? That website has pretty much every factor you want to consider including renewable energy content."
What should you look for when choosing an electricity plan in Ohio?
The PUCO site makes it easy to look through different offers and find a plan you're comfortable with.
"My recommendation would be to look for fixed rates, and keep an eye out for any fees and just factor that into your decision-making," Rutschilling said. "Also, from the Ohio Environmental Council's perspective, we recommend looking at the renewable energy content as well, because it's a great way to ensure your power is coming from a cleaner source. Often a fixed price will be tied to renewable energy, although it depends on the market and what's being offered."
How to make the switch in Ohio
Making the switch is easy in Ohio. With the information from your utility bill on hand, simply visit the PUCO marketplace, choose a supplier and click the "Sign Up" button. Be sure to save any confirmation number and other details. Your new plan's pricing should be reflected within a billing cycle or two.
Who has the cheapest electricity rates in Ohio?
There is no single energy supplier that offers the cheapest rates in Ohio, as it'll depend on where you live and what utility serves your area, whether the supplier charges fixed or variable rates and the length of the contract. Shop around for the best price and make sure to pore over all the other details, including any fees.
What is the best energy plan in Ohio?
The best energy plan is the one that you feel comfortable with, paying a rate you understand and find acceptable, whether that's fixed or variable. Based on your preferences, this plan could include renewable energy. Do make sure to look out for other charges, including a monthly fee or early terminal fees.