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What are the different energy rate and plan types?
Learn about your deregulated energy options.Written by Dominique Sabins
Edited by Aviva Tenenbaum
Last updated 2/21/2025
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Key Points
- Your electricity rate is how much you pay for your energy.
- An energy plan is the entire package you choose for your electricity.
- There are three main energy rate types: fixed, variable, and prepaid.
Frequently asked questions
A fixed-rate plan generally offers the most savings for the majority of consumers because it protects against market fluctuations and rate spikes. Fixed-rate plans also allow you to budget for your monthly energy bill because your rate stays the same. Some customers may still benefit from variable-rate plans, but most energy experts agree that fixed-rate plans are the cheapest overall.
Using less electricity is the most direct way to lower your energy bill. Try turning off your lights and unplugging unused devices. Other options include switching to energy-efficient appliances or shopping for a cheaper electricity rate.
You can avoid paying a deposit by qualifying for your provider’s credit limit or choosing a no-deposit prepaid energy plan. To avoid paying an early termination fee, you must either stay with your contract until it ends or move outside your provider’s service area.