Before long Michigan residents will be shivering through another blast of winter.
Everyone wants to stay warm, and it would be great to get natural gas for the lowest cost possible. Many consumers are tempted to look at alternative suppliers, but as Ruth to the Rescue has reported, the old "Buyer Beware" rule cannot be ignored when looking for a better deal.
Now, the Michigan Public Service Commission has unveiled a natural gas price comparison website that's designed to help consumers choose a provider. The commission says the website includes prices currently charged by alternative gas suppliers that are actively marketing or enrolling customers in Michigan, as well as the basic terms and conditions of their offers. It also includes information about charges by major utilities.
Rates Can Jump, Read the Fine Print
In the past, Ruth to the Rescue has reported on rates that can suddenly jump, leaving customers scrambling to pay extremely high bills. One of the most critical questions you should ask when looking at alternative gas companies is whether your rate will be fixed or variable. As the terms imply, a fixed rate is locked in at a specific price, while a variable rate can fluctuate as gas supplies rise and fall.
After you're are given a rate you must ask: how long with the agreement last? And, how does the contract renew? Some companies will give you a fixed rate for a certain amount of time. However, at the end of the contract, it will switch to a variable rate unless you take action to stop it. Depending on gas prices you may not even notice the change at first, but when supplies dip, prices will skyrocket, and suddenly your gas bill will double or triple.
You must ask the questions above and you read all the fine print connected to the terms and conditions, before signing any gas supply contract.
Checklist: What You Need To Do
As a consumer, before you make the switch to a third party supplier, there is a checklist of things you should consider.
1) What is the rate you're currently paying? Will the new rate be lower?
2) Is that rate guaranteed or fixed? For how long?
3) What happens at the end of the contract? Some contracts start fixed, but revert to variable if you don't renew.
4) Check the companies record with the Better Business Bureau and online reviews.
5) Don't rush into anything, especially if a salesperson contact you on the phone, or in person.
The new website from the Michigan Public Service Commission has launched just before the winter heating season begins. Officials say 77 percent of Michigan households used natural gas to heat their homes.
While this web page could be a very helpful tool, you should also know the Michigan Public Service Commission has no regulatory powers over third-party suppliers. That is an important distinction for consumers to understand. While the Michigan Public Service Commission does work with investor-owned utilities (like DTE and Consumers Energy) to set rates each year, it has no control over the rates charged by alternative companies.
That means only you can negotiate the best possible rate when you sign the contract. Use the website as one tool, do your homework, and stay on top of any changes.
Good luck and stay warm this coming winter.