As we get older, our vocabulary broadens — have you heard the word deregulation before? To be frank, deregulation is the reduction or elimination of government power in a particular industry, usually enacted to create more competition. This means that you, as a consumer, can now choose which supplier you would like to heat and light your home — better pricing and more savings in what was once a closed-off market. We help illuminate some of the more confusing aspects of Michigan deregulation and what it means for you.

The Brief History

Long ago, energy was a monopoly. This model was meant to keep energy at one price and supposedly provide large-scale economic benefits to customers. It began to break down in the second half of the 20th century when companies started building large nuclear power plants and passed the costs on to consumers. In the 1990s, state governments began ending monopolies on natural gas and electricity, hoping to encourage healthy competition and cheaper bills for homeowners by allowing private suppliers to sell within state lines. Michigan deregulation began in the year 2000.

What Does That Mean For Me?

Deregulation varies from state to state — some still have complete regulation across all energy sources. Michigan's deregulation is a unique hybrid system in which a percentage of customers can choose alternate power providers. However, a cap was placed in 2008 on how many customers could switch, meaning that once the cap is reached, all remaining customers are locked into the state utility. Over 11,000 customers have wanted to switch but been unable to, and many have argued the cap should be abolished entirely.

That makes it all the more important to take advantage today. Kratos Gas & Power offers one of the lowest rates in Michigan with our flexible variable rate — don't wait until the cap locks you out.

Michigan's deregulation is far from perfect, but it is still a system that rewards the informed consumer. Understanding your energy provider options is an important tool when navigating homeownership and household budgeting. Be sure to investigate what rates are available and keep reading the Kratos Gas & Power blog for more usable information about natural gas and energy usage.