Trim the Fat Tuesday: The Electricity Supply Rate, Part 2

We did this about six months ago, but smart shoppers will always be on the lookout for ways to

Lower electric bills by choosing the cheapest supplier possible.

Back in the winter I switched our electricity supplier to Verde Energy, which offered a lower price for electricity than National Grid's winter rate. That was a six-month contract locked in at 8.99 cents per kilowatt/hour, but starting this month they will switch us to their variable rate, which could (and most likely will) be higher than their promotional rate.

Even if it's not, coming to the end of the contract means that it's time to look around and see if we can do better. Sure, this is a task that takes a little work in the research department, but this is quick and easy thanks to National Grid's helpful list of possible providers. It really doesn't take all that long to click through each, check rates and terms of service, and make a choice.

I didn't think I would find anything cheaper than National Grid's own summertime rate of 8.277 cents. Lots of providers didn't even have their rates on display. If they had a great price, that would (or at least, should) be the first thing on the home page, as it was back in the winter.

But then, near the bottom, I found Provider Power Mass, and their rate was waaaaay lower than anyone else's:

Just 7.45 cents! Woohoo!

Reading the fine print let me know that this is a rate that you can lock in for six months, and then you have to opt out of their service when they inform you of the new rate (surely higher, as it will be winter again), or you're stuck for another six month term. I can deal with that, since now this is the sort of thing I pay attention to. With the help of a reminder on my iPhone, there's no worry about missing the deadline anyway.

Now, I'm not about to take that random $100 in savings number at face value, because I can do my own math. As you might recall from my previous post about this topic, the math is a little tricky, because this rate is only applicable to the electric supply, not the delivery (which is still with National Grid, since they own the wires or whatever). 

To make it easier, let's see what kind of "sale price" I'm getting now. The new rate of 7.45 cents divided by our current rate (still with Verde Energy) of 8.99 cents is .82869, which lets me know that we're now paying only 83% of what we paid before. I previously calculated my monthly savings at $15 per month, but since I'm now saving even more, I need to divide $15 by .82869, which is $18.07. 

Now, I'm not really saving that much more, because that's the total savings number. Remember, I already counted the original $15 of savings, so really we're just looking at the difference here. $18 minus $15 is actually $3 of additional savings on the electric bill per month. 

That might not sound like a lot, but playing the electricity supply rate game isn't just about saving more and more each time (impossible anyway), but also about being able to keep your bills from going up, which is also kinda important in the long run.

Savings per month: $3