Electricity Guides

Fixed vs Variable Electricity Rates

Compare fixed and variable electricity rate plans and understand trade-offs in price stability.

A fixed-rate plan generally keeps the energy rate stable for a contract term, such as 12 or 24 months. This can make budgeting easier when market prices fluctuate.

A variable-rate plan can change month to month based on market conditions or provider pricing policies. It may offer flexibility but can expose customers to higher costs during volatile periods.

Fixed plans may include early termination fees and credit requirements. Variable plans may have fewer commitment constraints but require ongoing monitoring.

The best choice depends on risk tolerance and expected market direction. Customers prioritizing predictability often prefer fixed terms, while flexible movers may prefer variable options.

Always check the electricity facts label or equivalent plan disclosure. Important details include base charge, pass-through charges, contract length, and cancellation terms.

When comparing plans, evaluate total estimated monthly cost at your expected usage, not only the headline cents per kWh rate.