Over a quarter of eligible residential electricity consumers participated in their state’s retail choice program in 2021, according to the U.S. Energy Information Administration. At the national level, participation in state retail choice programs has remained stable from 2019 to 2021, at about 26% of eligible U.S. customers participated in their state’s retail choice program, or 13.2 million U.S. residential electric customers.
How consumers buy electricity at retail is generally a matter of state law. Under the traditional system of vertically integrated utilities, a customer is served by a utility that provides both electricity supply and delivery service, and customers have no choice as to who serves their load. Most consumers nationwide are served by traditional utilities that both generate or purchase power and deliver it to their customers.
But some jurisdictions have restructured their electricity sectors, to give customers retail choice, meaning the customer can choose which provider they want to have supply their energy for delivery by the local utility acting as a "wires company". According to EIA, today 13 states and the District of Columbia have active statewide or districtwide retail choice programs for residential customers. The states include California, Connecticut, Delaware, Illinois, Massachusetts, Maryland, Maine, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, and Rhode Island. In addition, Texas has a mandatory retail choice program; and Michigan, Nevada, Oregon, and Virginia have limited forms of retail choice programs (mostly for non-residential electric customers).
According to EIA, participation by residential retail customers in retail choice programs grew from 2015 through 2019, and has remained stable at 26% through 2021.
Retail choice is generally a matter of state law. Laws vary by state, and can change over time, as can the degree to which customers choose to participate in retail choice programs where they are offered. For example, participation among Ohio residential customers increased from 45% in 2015 to 50% in 2021, while participation by Massachusetts residential consumers increased from 22% to 49%.
California launched its first Community Choice Aggregator (CCA) program in 2010, allowing local governments to buy power from retail suppliers on behalf of community residents, who have an option to opt-out if they don't want to participate in the program. Under the CCA system, participation in California grew from 2% in 2015 to 30% in 2021.
On the other hand, other states like Illinois and Connecticut have seen declines in residential retail choice participation rates, with Illinois dropping from 57% in 2014 to 31% in 2021, and Connecticut falling from 42% in 2013 to 24% in 2021.
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