What to know about ESCOs

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ESCO stands for Energy Service Company. ESCOs supply electricity and/or natural gas which your utility, such as National Grid delivers. Regardless of your energy source, your utility will continue to deliver your electricity and respond to service interruptions.  You will still be billed and pay your utility for these services.

ESCOs started following the deregulation of utilities with the idea that increased competition would lower prices.  ESCOs might be right for you if you want a fixed rate or 100% renewable energy.  These can be great tools but also something to be an informed consumer about. NYS’s Public Service Commission has discovered that some ESCOs use deceptive practices. 

Many ESCOs offer fixed rates for a period of time (3-12 months), after which they will become variable and fluctuate with market conditions.  Plan to review rates on a regular basis to make sure you’re still receiving cost savings.   Look for rates that are acceptable to you, and make sure the company has not had substantial negative reviews.

Community solar is often confused with being an ESCO. It is instead a subscription model. The solar credit you receive from subscribing to a community solar project helps to offset your electric bill, it does not replace your energy supply.  Community subscription solar offers savings on your electric bill regardless of whether you have a third-party supplier like an ESCO.