It’s no secret that the cost of electricity can vary widely from month to month.
Most electricity customers discover this firsthand if they have signed up for a month-to-month electricity plan which has a variable rate. There are price fluctuations that happen each month depending on factors such as customer demand (largely related to weather), and the available supply of electricity. To avoid these price swings, most residential electric customers choose a fixed rate electricity contract that locks in a favorable energy rate for a fixed length of time.
How do you determine what length of contract to sign? Is a short term or long term electricity contract better? It depends largely on the region of the country that you live in and the time of year that you are shopping for a fixed rate. Electricity contract term lengths vary and can be as short as 3 months or as long as 5 years. Most customers select contract terms between 6 months to 2 years. Learn about the benefits of the fixed rate contract and how to determine the best electricity contract length for you.