How Hidden Pass-Through Charges Impact Fixed Rates
Jul 29, 2014

The good news is that there have been some really attractive looking fixed rates being offered to residents in the Chicago marketplace. The bad news is that within these competitive rates could lie hidden costs and penalties.

To help protect yourself from these hidden costs, there are three things we recommend you closely watch to help ensure that the offer you’ve received, or are receiving, is in fact a good deal:

How Hidden Pass-Through Charges Impact Fixed Rates How Hidden Pass-Through Charges Impact Fixed Rates How Hidden Pass-Through Charges Impact Fixed Rates

#1 – Check the Price section of your agreement

In the pricing section of your agreement, check to see what components are fixed in your offer. The components included in a Fixed All-Inclusive rate should include Energy, Renewable Portfolio Standard (RPS), Ancillary, Losses, Transmission, and Capacity. If you do not have a copy of your agreement, you should call your provider’s customer service line and inquire about what is included in your offer. If any one of these components is NOT fixed, the actual price you will end up paying will be different from what was offered.

#2 – Check for Pass-Through Event language

Once you have confirmed what components are included or not included in the rate being offered to you or that you are on, look to see if there is any Pass-Through Event language. Pass-Through Events are often weather-related such as very high temperatures for an extended period of time, or a large storm powerful enough to disrupt energy production. They could also be related to newsworthy events such as turmoil in the Middle East, or state and federal regulatory changes. This contract language is very common as a result of the events following the polar vortex. Some providers are very quick to pass on to the customer any increase in costs and include language in the agreement allowing them to do so. They may offer low introductory pricing, knowing they have the right to increase it down the road.

The items that are usually represented in Pass-Through Event charges are the transmission and capacity components, which together make up about 20% of your energy cost.

#3 – Review Cancellation/Termination language

After you’ve completed a review of the price section of your agreement, another area to be especially aware of is the Cancellation/Termination section. Many providers have fees associated to terminating your agreement early. For residential customers, these fees can amount to as much as $200! On the other hand, commercial customers can face stiffer penalties and may be on the hook for the energy purchased through the end of their agreement.  Therefore, depending on your needs it may be worth paying a small premium on your contract so you have the ability to cancel your agreement at any time without penalty.

Shopping for energy isn’t always easy or straightforward. By taking the time to review the pricing and termination areas of an agreement, you can accurately assess the true value of a product and price being offered to you.

Still have questions about a rate being offered, or one that you’re currently on? AUS’s team of support specialists is here to help.

Related Posts

Lighting as a Service for Businesses of Greater Decatur

Alternative Utility Services (AUS), a registered Program Ally of the Ameren Illinois ActOnEnergy® Program, and the Greater Decatur Chamber of Commerce have partnered together to offer all area businesses the opportunity to upgrade their facility’s lighting to more...

Lighting as a Service for Greater Oshkosh Businesses

Alternative Utility Services (AUS) through the Greater Oshkosh Economic Development Corporation is providing all local area businesses the opportunity to upgrade their facility’s lighting to more efficient LED fixtures with no capital expense. This program is designed...


Copyright © 2021 Alternative Utility Services, Inc.

Privacy Policy    Terms of Use