How A New York Building Gets Its Electricity Bill
Delivery and supply are two different charges from potentially two different companies. Confusing them costs money.
An electricity bill in New York has two halves. One is delivery — moving power over the wires to your meter, provided by the utility for your area. The other is supply — the electricity itself, which you may buy from the utility or from an independent supplier.
Why the split exists
New York restructured its electricity market so that supply could be competitive while delivery remained a regulated monopoly. Nobody is going to build a second set of wires down the street, so delivery stays regulated. Supply, in principle, can be shopped.
Your delivery charge is set by rates approved by the Public Service Commission. Your supply charge depends on who you buy from and on what terms.
Independent suppliers
Energy service companies market fixed-rate and variable-rate supply contracts to households and businesses. A fixed rate provides budget certainty. A variable rate can be cheaper, and can also rise sharply.
The State has taken a close regulatory interest in how these products are sold to residential customers, following persistent problems with marketing practices and with variable rates that ended up well above the utility's own price. If you are offered a switch, get the rate, the term, and the cancellation terms in writing before agreeing to anything.
Demand charges
Commercial accounts are frequently billed not only for total energy consumed but for peak demand — the highest rate of draw in the billing period, measured over a short interval.
This surprises businesses because a single brief peak can set the charge for the whole month. Understanding when your peak occurs, and whether it can be staggered, is often the largest available saving on a commercial bill and requires no capital spending.
Reading your own bill
Before assuming a supplier switch will save money, separate the delivery and supply lines on your current bill and identify which one is actually large. Switching supply does nothing about a bill dominated by delivery and demand charges.