Regulated vs deregulated electricity: who sells you the power

The one thing that changes: who sells the electricity

An electric bill pays for two things: the electricity itself (supply, also called generation or energy) and getting it to your home over power lines (delivery, split into transmission and distribution). Delivery is a monopoly everywhere. Whichever system your state uses, one utility owns the poles and wires on your street, reads your meter and restores power after a storm.

The difference is supply. As EIA's electricity prices explainer puts it, in some states public utility commissions fully regulate prices, while others combine unregulated prices for generators with regulated prices for transmission and distribution. In the first group, the regulated states, your utility sells you both parts as one bundled price, and the commission approves that price. In the second, the deregulated or restructured states, the utility's delivery charges are still set by the commission, but the supply part is open: in EIA's words, customers can buy electricity directly from a power marketer. That option is what states call energy choice or retail choice.

Not choosing is always allowed. A household that does nothing in a choice state stays on its utility's default service, which goes by different names: the Price to Compare in Pennsylvania and Illinois, the Standard Service Offer in Ohio, Standard Offer Service in Maryland. Texas is the exception covered below.

Where households actually choose

Lists of "deregulated states" on the web disagree because some count laws, some count business customers and some count states where almost nobody shops. A cleaner test is what utilities report to EIA: how many residential customers buy their electricity from someone other than their utility. In 2025, 15 of the 50 states and DC were at 1% or more. Massachusetts led at 63.6%, followed by Ohio at 58.1%; in the median state the share was 0.0%¹.

The table hides three different designs. In most of the Northeast, the Mid-Atlantic, Ohio and Illinois, households choose between default service and licensed suppliers, and in Ohio and Massachusetts many communities buy in bulk for their residents through municipal aggregation. California allows choice through community choice aggregators (CCAs), local public agencies that buy power for everyone in their area unless a customer opts out; the CPUC's comparison page lists them by utility area. Texas has no default service in its competitive area at all.

Deregulated does not mean cheaper, or dearer

The residential average price (total revenue divided by kWh sold, not a tariff) varies widely within both groups. Over the last 12 months (September 2025 to August 2026), Hawaii averaged 44.27¢ per kWh, the highest among the states, with 0.0%¹ of homes buying from a supplier in 2025. North Dakota (12.35¢ per kWh, the lowest) and Nebraska (12.74¢ per kWh, 2nd lowest) had no retail choice for households either. Among choice states, Massachusetts averaged 30.39¢ per kWh, the 3rd highest, while Texas averaged 15.98¢ per kWh, the 25th highest, against a US average of 18.04¢ per kWh².

Source: EIA-861 annual electric power industry report, 2025 final; EIA, Electric Power Monthly / EIA-861M sales and revenue by state. Each dot is a state (horizontal: Customers with a supplier; vertical: Residential ¢/kWh, 12 months). Residential customers of energy-only suppliers and community choice aggregators (plus Texas retail electric providers) as a share of all residential customers (EIA-861 2025, EIA customer counting: bundled + energy-only + Texas retail provider accounts). Includes municipal or community aggregation where it is reported as energy-only. Residential revenue divided by kilowatt-hours sold over the 12 months 2025-09 to 2026-08 (EIA-861M; months since January 2026 preliminary). Average revenue per kWh, all charges included; not a tariff. Period: September 2025 to August 2026.

Show the numbers

State	Customers with a supplier	Residential ¢/kWh, 12 months
Alabama	0.0%	16.44¢
Alaska	0.0%	26.94¢
Arizona	0.0%	15.39¢
Arkansas	0.0%	13.57¢
Colorado	0.0%	16.61¢
Florida	0.0%	15.41¢
Georgia	0.0%	15.17¢
Hawaii	0.0%	44.27¢
Idaho	0.0%	12.77¢
Indiana	0.0%	16.90¢
Iowa	0.0%	14.20¢
Kansas	0.0%	15.13¢
Kentucky	0.0%	13.94¢
Louisiana	0.0%	13.02¢
Michigan	0.0%	21.28¢
Minnesota	0.0%	16.28¢
Mississippi	0.0%	14.85¢
Missouri	0.0%	13.97¢
Montana	0.0%	13.94¢
Nebraska	0.0%	12.74¢
Nevada	0.0%	13.45¢
New Mexico	0.0%	15.31¢
North Carolina	0.0%	14.79¢
North Dakota	0.0%	12.35¢
Oklahoma	0.0%	13.81¢
Oregon	0.0%	15.53¢
South Carolina	0.0%	15.77¢
South Dakota	0.0%	14.28¢
Tennessee	0.0%	13.61¢
Utah	0.0%	13.26¢
Vermont	0.0%	23.90¢
Virginia	0.0%	16.64¢
Washington	0.0%	14.20¢
West Virginia	0.0%	15.53¢
Wisconsin	0.0%	18.79¢
Wyoming	0.0%	14.01¢
Maryland	4.8%	21.18¢
Delaware	5.6%	17.98¢
New Jersey	6.1%	23.74¢
Maine	7.1%	29.60¢
New York	7.3%	28.60¢
District of Columbia	10.3%	24.48¢
Connecticut	16.3%	27.42¢
Pennsylvania	22.4%	20.86¢
Illinois	22.5%	18.91¢
Rhode Island	25.9%	29.44¢
New Hampshire	40.8%	26.95¢
California	42.1%	32.34¢
Texas	55.5%	15.98¢
Ohio	58.1%	18.41¢
Massachusetts	63.6%	30.39¢

Each dot is a state. Choice states appear near the top of the price range and in its middle; states without choice appear at both ends. One caution in reading the vertical axis: in choice states, the state's bundled average covers only customers who bought supply and delivery from one company, so it describes default-service customers (and, in Texas, retail provider customers), not what shoppers paid for supply alone.

Wholesale costs also reach both kinds of state. Lawrence Berkeley National Laboratory's 2026 retail price review reports that capacity costs in the PJM wholesale market raised average wholesale costs there by 0.9¢ per kWh in 2025 compared with 2024. Its list of PJM states where the average retail price rose from 2024 to 2025 includes Ohio (0.8¢ per kWh more) and Pennsylvania (1.2¢ per kWh), where households can choose, and Indiana (0.9¢ per kWh³), where in 2025 the share of homes with a supplier was 0.0%¹. Over the last 12 months the residential average rose 11.7% in Ohio, 12.3% in Pennsylvania and 8.8%² in Indiana.

In a regulated state: one price, three kinds of utility

A household in a regulated state cannot shop, but the company it buys from still matters, because regulated does not always mean investor-owned. EIA describes three kinds of utility: private, for-profit companies owned by stockholders; not-for-profit municipal utilities owned by a city or local government; and cooperatives owned by their members. Their bundled residential averages for 2025 were not the same.

Investor-owned utilities17.78¢

Electric cooperatives14.10¢

Public power (municipal, districts, state)14.49¢

Source: EIA-861 annual electric power industry report, 2025 final. Bundled (full-service) residential revenue divided by kWh, summed over every utility of each type (EIA-861 2025). Small utilities filing the short form report no residential split and are not included.

Show the numbers

Type	¢/kWh	Residential customers
Investor-owned utilities	17.78¢	81,897,613
Electric cooperatives	14.10¢	18,637,750
Public power (municipal, districts, state)	14.49¢	18,508,158

Investor-owned utilities served 81,897,613 customers and averaged 17.78¢ per kWh; cooperatives served 18,637,750 at 14.10¢ per kWh, and public power 18,508,158 at 14.49¢ per kWh. Each figure is an average over territories in every region, so it describes the type of utility, not any single company. Nebraska is the clearest case of a state built on public power: its public power utilities served 764,871 customers in 2025 at an average of 11.91¢ per kWh¹.

Cooperatives and city utilities exist in choice states too. In Ohio, for example, the six investor-owned utilities were the only ones reporting residential customers who bought supply elsewhere in EIA's 2025 data; the Ohio guide names them.

In a choice state: two prices on one bill

A customer who switches to a supplier gets a bill with two parts from two companies: a supply charge set by the supplier's contract and a delivery charge set by the utility's tariff. EIA reports what each part averaged, and the figures cover different customers, so they are shown side by side here, never added. Ohio is a useful example: 58.1%¹ of its residential customers bought from a supplier or an aggregation in 2025.

Utility full-service customers (default service): supply and delivery16.82¢

Competitive suppliers and CCAs: supply only8.61¢

Utility delivery for customers of a supplier: delivery only8.35¢

Source: EIA-861 annual electric power industry report, 2025 final. Average revenue per kWh by service part, EIA-861 2025. Supply-only and delivery-only averages each cover only part of a bill and different groups of customers; adding them gives only a rough estimate of what a shopping customer paid in total.

Show the numbers

Part of the market	¢/kWh
Utility full-service customers (default service): supply and delivery	16.82¢
Competitive suppliers and CCAs: supply only	8.61¢
Utility delivery for customers of a supplier: delivery only	8.35¢

In 2025, Ohio customers on default service paid their utilities an average of 16.82¢ per kWh for supply and delivery together. Customers of suppliers and aggregations paid 8.61¢ per kWh for supply alone, and their utilities collected 8.35¢ per kWh from them for delivery alone. In Pennsylvania the same three averages were 18.75¢ per kWh bundled, 12.92¢ per kWh supply-only and 8.08¢ per kWh delivery-only; in Illinois, 17.07¢ per kWh, 10.75¢ per kWh and 8.83¢ per kWh¹. These are past averages across all contracts, fixed and variable, old and new, not offers anyone can sign today.

Texas: no utility supply at all

In the competitive part of Texas there is no default service. The delivery utility (Oncor, CenterPoint and the others listed in the Texas retail choice guide) owns the wires and charges delivery, but every home must pick a retail electric provider, which bills supply and delivery together. That is why Texas figures look different. In 2025, retail provider customers paid an average of 17.23¢ per kWh across all providers and plans, delivery included; Texas customers who still bought from a utility, in the areas of city utilities, cooperatives and the utilities outside the competitive market, paid 13.11¢ per kWh¹. Both are bundled averages, but they describe two groups of homes in different parts of the state, so the gap is not what any household would save or lose by moving. Current offers are listed on the state's official site, Power to Choose.

Comparing an offer with the default price

The right comparison in a choice state is supply with supply, for the same months. The default supply price is published by the utility or the commission; in Illinois it is called the Price to Compare. The state's Plug In Illinois page explains that the utilities pass on the cost of default supply without mark-up, and for ComEd the Price to Compare is the electric supply charge plus the transmission services charge; distribution is billed separately whoever supplies the power. For November 2026, ComEd's Price to Compare was 10.103¢ per kWh⁴, supply and transmission together.

Three checks follow from how the two systems work:

1. Compare a supplier's price per kWh with the default supply price for the same period, not with a bundled average or a total bill divided by kWh: delivery stays the same whichever supplier you use.
2. Read the contract length and what happens when it ends. A fixed price can roll into a variable one, and default service prices change too: in Illinois, the state's supply purchases for default service have recently taken place twice a year, in spring and fall.
3. Use the state's own comparison site: PA Power Switch, Energy Choice Ohio, Plug In Illinois, Energy Switch Massachusetts or Power to Choose in Texas. The retail choice hub links the rest.

In a regulated state, the lever is different: your price changes through rate cases and riders that the commission approves, and the rate increases guide explains how those work.