Supply vs. Distribution

Your electric service has three parts.

  1. Generation: The production of electricity.
  2. Transmission: The movement of electricity from where it is generated to the point of distribution, such as a transformer in a sub-station
  3. Distribution: The delivery of electricity to your home or business.

In deregulated markets, you have the power to choose your electricity supplier—the company that generates your electricity or buys it from a generator. Generation supply costs make up most of your bill, so you can shop for a rate that saves you money. (For most customers, transmission costs will be included in your generation supply costs.)

Distribution is handled by your local electric utility. They maintain, upgrade and repair the lines that deliver electricity to your house. And they’re the ones you call if there’s an outage.