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Deregulated Energy States

Written By: Jason Ramach

Last Updated: 05/04/2023

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Since the early 1990s, 30 states and the District of Columbia have at least partially deregulated one or more of their energy markets. Instead of only having the option to get energy from their local utility company, deregulation gives consumers the ability to choose their energy supplier.

This forces energy suppliers to compete with one another, which helps keep energy prices low and provides consumers the opportunity to save. More than that, it gives consumers more control over where their energy comes from and offers more options to tailor their energy plans to their needs.

Implementation of energy deregulation varies by state. To learn more about Energy Choice in your state, you can do so by finding its section below. If you're a resident of one of the states serves, you can check out energy rates in your area by entering your ZIP Code at the top of this page.

Map of Deregulated Energy States

States With Deregulated Energy

*For commercial or industrial customers only or with extremely limited availability

N/A: Limited information or no specific point in time where deregulation started

Updated: 1/24/2022

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What Is Energy Deregulation? (aka Energy Choice)

Energy deregulation, also referred to as Energy Choice, gives the energy consumer the opportunity to choose the company that supplies their energy.

To further understand deregulation, it's important to understand the difference between utility providers and energy suppliers.

  • Utility Providers – Deliver electricity to homes and businesses in their service area.
  • Energy Suppliers – Supply the energy that consumers use. Also often called energy providers, electricity providers and retail electricity providers (REPs).

In conventional, regulated energy systems, utility providers and energy suppliers are one and the same. Your utility provider supplies and delivers energy for their entire service area, operating as a regional monopoly that's regulated by the state.

In deregulated systems, energy consumers still get their energy delivered by their utility provider. In fact, most deregulated states allow the utility provider to supply energy as well. However, these consumers have the option to switch to a different energy supplier if they want to.

Energy Choice has multiple benefits:

  • Save Money – Consumers can save by switching to a provider with a lower rate. This competition also helps keep costs down.
  • Predictability – Some suppliers let you lock in an energy rate for years, so you don't have to worry about unexpected rate hikes because of market conditions.
  • More Options – Consumers have the option to choose plans that come with a variety of incentives, like plans that are sourced from renewable energy or plans with carbon offsets.

States With Deregulated Electricity & Natural Gas

California Energy Choice

California deregulated its energy markets throughout the 1990s, and deregulated electricity in 1996.

Today, Natural Gas Choice is available for consumers under Pacific Gas & Electric,San Diego Gas & Electric andSouthern California Gas utilities.

Electric Choice, however, is only available for commercial and industrial consumers in thePacific Gas & Electric,San Diego Gas & Electric andSouthern California Edisonutility territories at a capped percentage.

Connecticut Energy Choice

In May 1998, Connecticut ratified legislation to deregulate energy markets so customers could choose their retail energy provider. By 2011, 41.8% of Connecticut energy customers chose competitive suppliers. This adoption rate was one of the highest in the country and accounted for over two-thirds of the electricity sold in the state.

Today, Connecticut remains a deregulated energy state with Electric Choice available for residential and commercial customers under Eversource or United Illuminating.

Natural Gas Choice is only available to commercial and industrial customers in Connecticut.

Illinois Energy Choice

In 1993, the Illinois natural gas market was deregulated, followed a few years later by electricity in 1997. Both are still deregulated today and available to residential and commercial customers.

Electric Choice in Illinois is available for customers under AmerenorCommonwealth Edison.

Illinois' commercial and residential customers under Nicor Gas, North Short Gas and Peoples Gas utilities have the option to purchase natural gas from an Alternative Gas Supplier (AGS). Industrial and commercial consumers also have the Natural Gas Choice available throughAmeren.

Maine Energy Choice

Throughout the 1980s and 1990s, Maine experienced escalating energy supply costs and an increase in public support to eliminate heavy regulation across industries. These two forces prompted legislators to make Maine a deregulated energy state. The first proposal to do so occurred in 1995 for the natural gas industry, passing three years later. Electricity followed suit in 2000.

Maine residents and businesses now have Electric Choice in theEmeraandCentral Maine Powerutility territories.

However, Natural Gas Choice remains limited to commercial and industrial consumers within the state.

Maryland Energy Choice

The federal government urged states to promote competition and deregulation in the 1990s. Heeding this guidance, Maryland passed the Electric Customer Choice and Competition Act of 1999 to deregulate utilities throughout the Old Line State.

For electricity, Marylanders under the utility providersBaltimore Gas and Electric (BGE),Choptank Electric Cooperative,Delmarva Power,Potomac Edison,PEPCO andSMECO have the opportunity to switch providers.

Deregulated natural gas is available to the state of Maryland through Baltimore Gas and Electric Company (BGE)andWashington Gas Light(WGL). However, some areas of Maryland are not eligible for Natural Gas Choice.

Massachusetts Energy Choice

Massachusetts shifted to Energy Choice in 1998 through the Massachusetts Electrical Utilities Deregulation Referendum. Today, residents and commercial consumers may choose from a few different suppliers in the deregulated energy state.

Electric Choice is available for Massachusetts residents and businesses throughEversource(formally known as NSTAR and Western Massachusetts Electric Company),Unitil, andNational Grid territories.

While Massachusetts consumers may switch natural gas providers, the ability to switch is fairly limited in the state.

Michigan Energy Choice

With several states deregulating their energy markets, Michigan followed suit in 2000, deregulating both its electricity market and natural gas market.

While Electric Choice is permitted in the state, no more than 10% of an electric utility's average retail sales may be from an alternative electric supplier. This means that choice is fairly limited in the state.

Natural Gas Choice is available for consumers underConsumers Energy,DTE Gas,Michigan Gas Utilities andSEMCO Energy Gas Company.

Montana Energy Choice

Montana's electricity and natural gas industries were officially deregulated in 1997, but Energy Choice is limited in the state today.

Residents and small commercial customers are eligible for deregulated natural gas in Northwestern Energy and Energy West Montana territories throughout the state. Northwestern encompasses several larger towns and cities such as Billings, while Energy West serves areas such as Great Falls and Yellowstone.

While Electric Choice is technically available in Montana, it is extremely limited.

New Hampshire Energy Choice

The New Hampshire legislature introduced energy deregulation to the state in 1996, but it took two years for implementation to take effect. It started with industrial and commercial customers before Energy Choice was more widely implemented.

However, Electric Choice is now established and available under these utilities:

  • Public Service Company of New Hampshire (PSNH)
  • Liberty
  • Unitil Energy Systems, Inc. (UES)
  • New Hampshire Electric Cooperative, Inc. (NHEC).

While Natural Gas Choice is available in New Hampshire, only commercial and industrial users are eligible at this time.

New Jersey Energy Choice

New Jersey wanted to give residents the option to choose their energy suppliers and hopefully lower rates through a competitive market. In February 1999, the state enacted the Electric Deregulation and Energy Competition Act (EDECA) to do just that.

Both natural gas and electricity were deregulated simultaneously for residential and non-residential customers of New Jersey. Residents and commercial users may freely switch energy providers in New Jersey.

Electric Choice is available to those under the following utility providers:

For Natural Gas Choice, customers must be in Elizabethtown Gas,New Jersey Natural Gas,PSEG orSouth Jersey Gas's service area.

New York Energy Choice

The first movement toward energy deregulation in the Empire State occurred in 1996 when the New York Public Service Commission began to open up the market. Energy costs were rising and paved the way for more competition and less regulation.

Today, New York provides Energy Choice for both residential and commercial customers. The utility providers Central Hudson, ConEd, NYSEG, National Grid, Orange & Rockland and RG&E all have some form of Electricity Choice.

Natural Gas Choice is also available in New York under the following utility providers:

  • Central Hudson
  • ConEdison
  • Corning Natural Gas
  • National Grid
  • National Fuel Gas Company
  • Orange & Rockland
  • RG&E
  • St. Lawrence Natural Gas

Ohio Energy Choice

Ohio officially became a deregulated energy state in 1999, requiring a 5% residential rate reduction and freeze until 2005 to allow the market time to expand. Today, millions of Ohioans get their energy from a third-party supplier.

Commercial and residential customers under the following utilities can switch electricity providers in Ohio:AEP Ohio,Dayton Power & Light,Duke Energy Ohio andFirstEnergy(Ohio Edison, The Illuminating Company and Toledo Edison).

Residents or businesses are also eligible for Natural Gas Choice in Ohio if they live in service areas of these utility providers: Columbia Gas,Dominion,Duke Energy andCenterPoint Energy.

Pennsylvania Energy Choice

In 1996, the first piece of legislation to deregulate Pennsylvania's energy market was introduced. It passed, and soon after that, Electric Choice was available to many PA residents.

Pennsylvanians can switch energy suppliers as they please, saving them money by choosing the right provider for their area and needs. The Pennsylvania market is vast, with over 100 electricity providers licensed by the Pennsylvania Public Utility Commission.

Click below to learn more about Pennsylvania utilities offering Electricity Choice:

A few years after deregulating electricity, Pennsylvania deregulated the natural gas industry in 1999. After that, natural gas utility companies had to offer Energy Choice to their customers.

Rhode Island Energy Choice

In 1996, Rhode Island joined four other New England states on this list to restructure and deregulate energy for consumers in the state. Today, Rhode Islanders may opt to buy electricity or natural gas from a third-party competitor other than their standard utility providers.

Texas Energy Choice

Texas made the leap to deregulate energy in 1999 with full implementation by 2002. In the Lone Star State, Energy Choice is often referred to as the power to choose.

Texas is unique because many residents and businesses cannot get electricity supply from their utility provider. In other words, they must choose their own electricity provider.

Those under the utility providers CenterPoint, Oncor, AEP Texas and Texas-New Mexico Power (TNMP) cannot get electricity supply from them. These four providers cover roughly 85% of Texans and their singular role is to deliver the electricity. Instead, customers are required to choose a Texas electricity provider.

While Natural Gas Choice is available, it's currently limited to industrial and commercial consumers.

Virginia Energy Choice

Virginia began offering Energy Choice in the early 2000s, but limited Energy Choice in 2007. Virginians with usage over 5 MW can choose a third-party provider, but it is not available to most residents. The only loophole to this is if the resident wants renewable energy and their utility provider does not offer that option.

However, Natural Gas Choice is available for Virginia residents.

Washington, DC Energy Choice

In 1995, the beginnings of Natural Gas Choice came to fruition in Washington, DC. Energy Choice is now an option for both DC residents and companies in the Washington Gas Light territory which spans the entire city.

A few years later in 2001, Washington DC opened up to Electric Choice with the DC Council approving retail electric competition in the District. Today, Electric Choice is widely available for commercial and residential use in PEPCO territory which spans the entire city.

States With Electricity Deregulation Only

Delaware Energy Choice

In 1999, electric supply was deregulated for Delaware residential and commercial customers in territories covered byDelmarvaandDelaware Electric Cooperative.

Oregon Energy Choice

Oregon chose to partially deregulate energy in 1999, originally only allowing industrial and commercial consumers to choose their electricity supplier. Today, Electric Choice is not available for residential customers.

States With Gas Deregulation Only

Georgia Energy Choice

In July 1998, the Georgia governor signed into law natural gas deregulation for residential and commercial consumers. It is not applicable to electricity and is not a statewide initiative.

Only Georgians who reside in Atlanta Gas Light’s Company‘s (AGLC) service area are affected by deregulation. Those in that service area must choose their energy supplier, or "marketer".

Learn more about Energy Choice in Georgia.

Florida Energy Choice

While Florida has proposed Energy Choice measures over the years, the state continues to limit its deregulated energy to natural gas. Since 2002, Natural Gas Choice has been available for certain residential and commercial energy consumers.

In the past, Energy Choice was only available to Central Florida Gas customers. However, it's now available to Florida Public Utility customers as well, as the two utility companies merged under one name.

Indiana Energy Choice

Another state that opted for Natural Gas Choice is Indiana, though on a limited basis. In 1998, the state legislature decided that only residents or businesses who are in NIPSCO‘s service area are able to choose a third-party competitor for their natural gas needs.

NIPSCO's territory covers 32 counties in the northern part of the state. Those who live in the south do not have Natural Gas Choice options.

Kentucky Energy Choice

In the year 2000, the Commonwealth of Kentucky joined the deregulated state ranks by rolling out a three-year pilot program called "Columbia Customer Choice." As the name suggests, only residents and commercial consumers under the purview of Columbia Gas of Kentucky could take advantage of the program.

Columbia Gas is located in 30 Kentucky counties on the eastern side of the state. Those outside of this territory do not have Natural Gas Choice.

Nebraska Energy Choice

Like many others, Nebraska proposed full Energy Choice legislation in the mid-1990s but rejected retail competition for the electric supply. However, natural gas was deregulated and introduced retail competition for some residential and commercial consumers under Black Hills Energy.

Wyoming Energy Choice

Natural Gas Choice is available in Wyoming, but very limited. Only certain customers within the Black Hills Energy service territory are eligible to partake in Energy Choice.

States With Extremely Limited Energy Choice

The following states have very small Natural Gas Choice programs that may be available to commercial and industrial customers. However, information on each state's respective program is extremely limited.

  • Kansas
  • Nevada
  • South Dakota
  • Tennessee
  • West Virginia
  • Wisconsin