"Switch and save" is the wrong answer to most US bill questions.
Most guides treat your bill as one number with one rate attached. They tell you to compare suppliers and switch to save. That advice is wrong for two reasons.
First, in the United States retail electricity is regulated state by state, not nationally. About 18 states plus Washington DC let you pick your own supplier; the other 32 do not. If you live in a regulated state — most of the South, the Pacific Northwest, the Mountain West — there is no supplier to switch to.
Second, even in deregulated states, the supplier only controls one slice of your bill. Everything else — wires, monthly customer charge, taxes, riders — is set by your utility and approved by your state's PUC. "Low rate" plans look cheaper because they only show you the slice they control.
Three layers. Every US bill. Always.
Every electricity bill in the United States, in every state, breaks down into the same three layers. Once you see them, the rest is easy to read.
Layer 1 — Shoppable
Supply
The cost of the electricity itself, in cents per kWh. In a deregulated state this is what your supplier controls.
Layer 2 — Regulated
Delivery
The cost of moving power from the grid to your house — wires, poles, transformers, meter reading. A regulated monopoly. You pay it no matter who supplies your power.
Layer 3 — Mandatory
Fixed charges & taxes
A monthly service charge (like a subscription fee — you pay it even at zero usage), plus state taxes and approved riders for efficiency and assistance programs.
Every line on your bill belongs to one of these three layers. Once you know which, you know who sets the price and whether you can change it.
Every charge, decoded.
Utility billing language is inconsistent — the same line is called five different things across five states. This table maps the most common names back to what they really are.
| Line on your bill | What it really is | Who sets it | Shoppable? |
|---|---|---|---|
| Energy / Generation / Supply | Layer 1 — the electricity | Your supplier or utility tariff | Yes |
| Distribution / Delivery / TDU | Layer 2 — getting it to your house | State PUC, via your utility | No |
| Transmission | Layer 2 — high-voltage transport | FERC + your ISO/RTO | No |
| Customer / Service / Basic | Layer 3 — fixed monthly fee | State PUC | No |
| Riders (efficiency, renewables) | Layer 3 — state policy programs | Legislature + PUC | No |
| State sales / gross receipts tax | Layer 3 — government revenue | State / local | No |
In Texas your bill calls the wires part a TDU charge. In Pennsylvania it is the distribution line. In New York it is delivery. Same thing, three names.
"15% off" is really about 7% off your bill.
In most US deregulated states, only about 45–60% of your bill is supply — the part you can shop. The rest does not move when you switch.
A supplier offering 15% off is offering 15% off less than half your bill. That is roughly 6–9% off your total.
It also explains why two neighbors with identical usage and the same supplier can pay very different totals. Same supply rate, different utility, different fixed charge, different state taxes.
at US-average rates, all-in
How the price you pay is actually assembled.
A typical residential rate is built from four price-setting processes happening in parallel.
Wholesale generation
Power plants sell into a regional auction every day. In ERCOT, prices can spike from $30/MWh to the cap of $5,000/MWh during scarcity. Suppliers pass cost on — immediately on variable plans, hedged on a fixed contract.
Transmission tariffs
High-voltage transport is federally regulated by FERC. It is the small "transmission" line on your bill — usually under 2¢/kWh.
Distribution tariffs
Each utility files a rate case with its state PUC every few years. The PUC then approves the per-kWh delivery rate and the fixed customer charge.
State riders & taxes
State legislatures add line items for efficiency programs, renewables credits, low-income assistance and storm recovery.
Each layer is set by a different regulator on a different timetable. That is why your bill can rise even when you "locked in" a fixed supply rate — the locked part is layer 1 only.
How US households quietly overpay.
Five recurring patterns we see in customer bills. Each costs real money. Each is fixable.
Natural gas bills follow the same logic.
The supply layer is the gas itself, priced per therm. The delivery layer is the local utility moving gas through pipelines to your meter. The fixed layer is a monthly service charge and taxes.
Your meter measures volume in CCF or Mcf. The utility converts: 1 CCF ≈ 1.025 therms.
What to actually do with your bill.
Find your usage
The kWh used this period — usually under "Meter readings". This is the number that drives everything.
Find the supply line
If you live in a deregulated state, this is the only line you control. Its dollar value is your "shoppable" amount.
Add up everything else
Delivery, customer charge, riders, tax. That is your "floor" — even free electricity would still cost you this.
Use the analyzer above
Pick your state and usage — the live breakdown shows what your total should look like at typical rates.
Deregulated state
Compare apples to apples: same usage, same plan length, all-in price including fees and post-intro rate.
Regulated state
Levers left: usage, on-bill assistance (LIHEAP) and efficiency upgrades (IRS tax credits, utility rebates).
Common questions about US energy bills.
Three usual suspects: a supplier rate change (especially after a fixed contract expired), a PUC-approved delivery rate increase, or a new rider added by your state. Look at last year's bill side by side with this one and compare each layer separately. The line that moved the most is your answer.
Yes, but every state has rules — typically a written notice (10–30 days), a minimum balance threshold, and seasonal or medical exemptions. Contact your state's PUC or 211 helpline; LIHEAP can also pay arrears for eligible households.
A fixed-rate plan locks the supply price for a set term (commonly 6, 12 or 24 months). A variable-rate plan changes monthly, often pegged to wholesale market prices — it can be a bit cheaper in normal months and several times higher during scarcity events (winter storms, summer heat waves).
It pays for the part of the system you use just by being connected: the meter, the line to your house, billing and customer service. State PUCs approve this charge in each utility's rate case. You pay it every month, whether you use 0 kWh or 5,000 kWh.
They spread your annual bill into 12 equal monthly payments. You do not pay less overall — you just stop the seasonal whiplash. Useful for budgeting; neutral for total cost. Check at year-end whether your actual usage tracks the estimate.
Yes — if you have solar, exported kWh credit back against your supply charge (and in some states, partially against delivery). The exact credit value is set by your state's PUC. California (NEM 3.0) credits exports at near-wholesale value; many other states still credit at near-retail. The rules are state-specific and changing — check your PUC's current order.