— they can choose among competing Retail Electric Providers (REPs), also called retail suppliers or competitive electricity providers depending on the state.
What a REP Actually Does
A REP buys electricity on the wholesale market and sells it to retail customers under its own rate plans and contracts, while the local utility continues to own the poles and wires, handle outages, and deliver the power regardless of which REP a customer picks. Customers pay the REP for the energy itself and typically still pay delivery charges to the utility.
Deregulated vs. Regulated Markets
In regulated states, a single vertically integrated utility generates, transmits, and sells power, and its retail rates are set by a state regulator. In deregulated states, generation and retail supply are opened to competition while transmission and distribution remain regulated monopolies. Texas, much of the Northeast, and parts of the Midwest have some form of retail choice; many other states remain fully regulated.
What to Watch For as a Customer
Retail electricity contracts can include fixed-rate, variable-rate, or indexed pricing, early termination fees, and introductory rates that increase after a set period. Consumer protection agencies in deregulated states generally require standardized disclosures — comparing the all-in rate, not just a headline price, is the most reliable way to evaluate offers.
Where This Fits at Watts & Wire
Our REP Corner tracks how retail choice functions across deregulated states, using publicly available regulatory filings and utility commission resources. This content is educational and does not constitute an endorsement of any specific provider or plan — see our Data Sources & Disclaimers page for details.