Electricity industry infrastructure

Delivery charges—also known as distribution charges—are fees from your local utility for delivering electricity or natural gas to your home. These charges cover the cost of maintaining the poles, wires, pipelines, and other infrastructure needed to safely and reliably transport energy.

Depending on your utility, delivery charges may include:

• A fixed charge that remains the same each month, regardless of usage
• A variable charge based on the amount of energy you use
• Or a combination of both

These charges are separate from the supply portion of your bill and are regulated by your state’s public utility commission.

In a competitive energy market, several key players work together to ensure reliable service and give you the power to choose the best energy plan for your needs:

• Generators: These companies produce the electricity that powers your home. They generate energy from a variety of sources, including natural gas, coal, nuclear, wind, and solar.
• Suppliers: Suppliers purchase energy on the open market and compete with one another to offer plans tailored to your needs—often featuring fixed or variable rates, contract flexibility, renewable options, rewards, and other perks.
• Utilities: Your local utility company is responsible for delivering energy to your home, maintaining the infrastructure (like power lines and gas pipelines), responding to outages or emergencies, and typically issuing your monthly bill—even if you choose a different supplier.

Electricity suppliers—such as Direct Energy, NRG, and Green Mountain Energy—and your local utility company work together to deliver energy to your home, but they serve different roles.

• Electricity Supplier: A supplier is a retail or competitive energy company that sells electricity and/or natural gas plans in choice areas. If you live in a competitive market, you can shop among various suppliers to choose the rate, contract length, and plan features that best meet your needs. Some suppliers also offer perks like rewards programs or renewable energy options.
• Local Utility Company: Your utility is responsible for physically delivering electricity or gas to your home. This includes maintaining the power lines or gas pipelines, reading and servicing your meter, and handling any outages or emergencies. The utility does not go away when you choose a different supplier—it continues to maintain the infrastructure and provide customer service related to delivery.

In some areas, your utility may also offer its own energy plans and compete with other suppliers in the market. However, choosing a supplier does not affect the reliability of your service.

Energy competition in Pennsylvania means you have the option to choose your electricity and/or natural gas supplier, rather than relying solely on your local utility for energy supply. While your utility will still deliver the energy and maintain the infrastructure, you can shop for a supplier that offers a plan with rates, terms, and perks that best fit your needs.

This competitive energy market gives you more control, greater flexibility, and the opportunity to find added value in your energy service.

Energy choice gives you the power to select who supplies electricity to your home—even though your local utility still owns and maintains the power lines.

Here’s how it works:

• Energy is generated from various sources (such as natural gas, wind, solar, and coal) and sold on the open market.
• You choose a supplier and energy plan that best fits your home and lifestyle.
• Suppliers purchase electricity to meet your needs and may offer added benefits, such as rewards programs or other perks.
• The supplier coordinates with your local utility to ensure a smooth transition, with no interruption to your electricity service.

With energy choice, you have more control over your rate, plan features, and the overall value of your electricity service.

TDSP stands for Transmission and Delivery Service Provider. These utilities own the poles and wires that deliver electricity to homes and businesses. They also own the meter that tracks electricity usage, and provide the usage information for monthly billing.

In the deregulated areas of Texas, where consumers sign up with a Retail Electricity Provider (REP), the TDSP bills the REP for their fees, and the REP will pass this on to the consumer. Sometimes called Delivery Charges, these fees are regulated by the Texas Public Utilities Commission. TDSP charges differ, depending on where you live, but you can find the charges at the top of the EFL for any plan.