“What's a delivery charge on my electric bill?”: supply vs delivery

"It's not like a truck brings it." You're right, no truck. But there is a lot of equipment between the power plant and your outlet, and somebody has to build, run and repair it. That's what the delivery section pays for.

Your bill is two bills

In many states, electricity is billed in two parts:

• Supply (or generation): the electricity itself, the energy you used, measured in kilowatt-hours.
• Delivery (or distribution, sometimes plus transmission): the poles, wires, substations, transformers, meters and crews that bring it to your house.

In some states both parts come from one company and the bill may not split them clearly. In others, often called retail choice or deregulated states, you can pick who supplies the power, but the local utility still owns the wires and still delivers it. Pennsylvania is one of the choice states, which is why your bill splits the two and why someone is knocking on your door.

Reading the delivery section

Here's what you're likely to see under delivery. Names vary by utility; the ideas don't.

Line	What it pays for	Changes with your usage?
Customer charge / basic service charge	Meter, billing, the cost of having an account	No. Same each month
Distribution charge	The local wires and equipment	Yes, per kWh
Transmission charge	High-voltage lines from plants to your area	Usually per kWh
Riders or surcharges	Specific programs approved by the regulator, such as efficiency or storm recovery	Usually per kWh
Taxes	State and local taxes on the bill	Proportional

Every one of those rates was approved by your state utility commission in a public rate case. The utility can't simply raise them. That's the main reason the answer to your second question is no.

Would switching get rid of it?

No. If you switch supplier, the supplier's charge replaces the supply section. The delivery section stays, with the same utility, at the same regulated rates. You'll still have one bill, usually from the utility, with the supplier's charge on it.

So the only question is whether the new supply rate is better than the one you have now. To answer it, you need your utility's price to compare. In Pennsylvania and some other choice states, it's printed on the bill: the supply cost per kWh you're paying on the utility's default service. It changes periodically, often every few months, and the utility posts the schedule.

Judging the knock on the door

Ask for these five things, in writing, before you decide:

1. The rate, in cents per kWh. Compare it directly to your price to compare.
2. Fixed or variable. A variable rate can start low and change monthly.
3. The term. Six months, twelve, twenty-four?
4. Early termination fee. What it costs to leave.
5. What happens at the end. Many contracts roll onto a month-to-month variable rate if you do nothing.

A low introductory rate that becomes variable is the classic trap in retail electricity. If the seller can't give you all five in writing, that's your answer.

Your state utility commission likely runs a shopping site where suppliers list their offers side by side. In Pennsylvania it's PAPowerSwitch, from the Public Utility Commission. Comparing there takes ten minutes and doesn't involve anyone at your door.

Why I said keep

Your letter asked about one specific charge, and that charge is legitimate, regulated and unavoidable as long as you're connected to the grid. Paying it is fine. Staying on the utility's default supply is also fine. It isn't a penalty; it's a regulated price, and plenty of households never switch.

If you want to try a supplier, choose a fixed rate below the price to compare, with a term you can live with and a calendar reminder a month before it ends. That's a reasonable choice. Signing something at the door isn't.