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Detroit Electricity Rates

Written By: Adam Cain

Last Updated: 11/10/2020

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Electricity Rates in Detroit

Residents of Detroit have consistently paid more for their electricity than most residents throughout the nation 20% higher than the national average, in fact. Fortunately, Michigan's electricity market is partially deregulated, meaning that many residents and businesses can shop around for the supply side of their electric service. If you're still buying your electricity from Detroit Edison, you'll want to look into switching to a retail electricity provider.

Unlike in most deregulated states, Michigan places caps on each utility for the number of customers that can make the switch. While only about 10% of Detroit Edison customers are able to participate in electric choice at any given time, you can still sign up. You will be placed on a waiting list, and will be able to switch once a spot opens up.

Electricity Providers in Detroit

Many retail electricity providers service residents and businesses in the Detroit area. Most have lower rates than Detroit Edison, and offer both variable-rate and fixed-rate plans, various contract lengths, and various incentives. Use our free Compare & Switch tool at the top of this page to view a list of reputable providers that service the Detroit area. Simply type in your ZIP Code and select Detroit Edison as your utility to view a list.

There are several things to keep in mind whencomparingelectricity providers and plans:

1. Low Rates

Find the rate you are currently paying be viewing your most recent Detroit Edison bill. The rate will be expressed in cents per kilowatt hour (kWh) and will look something like: 10.323 cents/kWh or $0.10323 cents/kWh. You'll of course want to look for plans with rates below that of what you're currently paying.

2. Rate Structure: Variable v. Fixed

Electric supply plans will offer either fixed' or variable' rates. Fixed-rate plans offer one rate that cannot change for the duration of your contract. Variable-rate plans, on the other hand, have rates that will fluctuate along with the wholesale market prices of electricity. This means that the rate you see may not be the rate you pay a month or two from now (the rate can go up or down, depending on market prices).

3. Contract Length

Most variable-rate plans have month-to-month terms, so you can cancel at any time with no penalty. Fixed-rate plans, on the other hand, are most often offered in 3 to 36 month terms. We recommend 6- to 12-month terms so you can lock in a good rate and be able to shop around again if rates go down elsewhere in the next year.

4. Fees, Incentives, and other Features

Some, but not all, companies may require a one-time small set-up fee. On the other hand, some companies will offer incentives to do business with their company, including sign-on bonuses, rewards programs, and discounts on energy-related products and services.

5. Energy Source: Renewable v. Fossil Fuels

There is an abundance of retail electricity providers that offer partial or 100% green plans in which you can rest assured that your electricity is coming from 100% renewable sources, including wind, solar, biomass, and more. You'll even find that that many providers are offering rates for green plans for prices below Detroit Edison's default rates. Some providers even offer electricity sourced from natural gas. While not renewable, natural gas has less impact on the environment as traditional coal.

Make the Switch

Once you have chosen the best provider that best fits your needs, you'll find that switching is easy. If you have found a provider by using our free Compare & Switch tool (at the top of this page), then you can sign up through the provider's link right away. Otherwise, you can call the provider and ask to switch. You'll need a recent utility bill on hand so that you can provide your account information.

After you've signed up, the new rate will appear on your electric bill within one to two billing cycles. Detroit Edison will continue to deliver your bill, maintain the wires and poles that deliver the electricity to your home, and respond to any emergencies such as power outages and downed power lines. The reliability of your electric service will not change, since it is the responsibility of Detroit Edison.