For decades, local utility companies provided almost all electricity services. They generated the electricity. They transmitted it. And they maintained all the lines. Because the local utility had total control over electricity, state governments regulated their activities.

Things are different now. Some state governments have opened their electricity markets to customer choice for electricity supply, also known as “deregulation”. They have separated distribution and supply.

Maintaining the power lines (sometimes called “the grid”) is considered a public interest, so government still regulates the distribution function. That’s one of the roles of public utility commissions (PUCs).

It’s the supply side that has changed. Most states with competitive markets allow more than one company to offer your electricity supply.

With deregulation, you can select your own electric supply company. (You can’t choose your electric distribution company.) Deregulation allows many companies to compete and offer you a variety of plans to fit your needs. Competition should also lead to lower prices for you.