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Deregulation In A Nutshell

Dana Lucas - Monday, December 19, 2011

Depending on where you live in the United States, energy deregulation may be an oft-debated topic.  Energy experts, economists, consumer advocacy groups, and assorted other organizations, have weighed in on the argument for or against deregulation around the country.  For the average household, the multiple options and opinions available can be more than a little confusing.  What many interested groups fail to do, is outline exactly what energy deregulation is, before they start arguing about why it should occur or not.

In a nutshell, energy deregulation allows the consumer to decide which corporation or organization from which to purchase their energy.  Until recently, each utility was controlled by a particular company, and everyone within a particular state or region purchased their energy, be it gas, light, phone service, etc., from the controlling company.  Deregulation allows for competition among companies, as it means that no single corporation can hold a monopoly on the energy market in a particular area.  The competition among providers has lowered business energy rates and business electricity rates in a number of areas.  Not all states have adopted the practice, and there is still some question about the overall efficiency of a deregulated system.  Only time will tell.   




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