FAQ - Breakerbox

1 – 833 – 275 – 7269

Resources & FAQs

We are here to help you connect the dots on all things energy.

Select a category

Energy Buying

Electric Service Quality

Contract Terms

Energy Buying

Why do energy suppliers exist?

Energy suppliers exist to manage energy price volatility and to provide innovative products that match the needs of their customers. In order for power to get to your home or business, there are companies that focus on generating power (e.g., nuclear, gas, solar, etc.); then there are “Suppliers”. Suppliers buy energy from companies in generation and structure and sell that energy to utilities or directly to homes and businesses. Suppliers may go by different names including, but not limited to: wholesalers, Retail Energy Providers / REPs, or Alternative Retail Energy Suppliers / ARES.

Why do energy prices fluctuate?

There are a number of factors impacting the price you pay for energy. Depending on the state, the portion of the grid you are connected to, and your local utility, certain price variables may have a stronger or weaker impact on your total price of energy. The variable “energy” is often the largest and most volatile price component in your total price of energy and reflects the market’s expectations of energy supply (of either a fuel source or the power plants themselves) and energy demand. As investor perception of supply and demand fluctuates, along with fluctuations in the values of the underlying assets, the price for energy also fluctuates.

Why doesn't everyone do this?

We have a few theories as to why some folks choose not to engage in competitive energy markets. We expect there are folks on the sidelines because they are unaware that this is an option or they are unaware of the benefits of this option. Some, who have heard of competitive energy markets, have also received misinformation which makes these markets seem unappealing. Still, others may have had a broker or supplier sell them an inappropriate energy contract with hidden or variable fees. Breakerbox is built on trust and transparency; explain how energy markets can work to the benefit of the customer’s energy goals.

Why does Breakerbox need to know my usage data?

The price you pay for energy is determined in part by how and when you use energy. Most of the energy on the grid is provided by power plants that produce consistent amounts of energy while operating. Because energy must be consumed as it is produced, energy suppliers prefer to sell to users with likewise consistent usage. all else being equal, using more energy at one point in time will likely cost more than using the same amount of energy consistently over a longer period. When you provide Breakerbox with your energy usage data, we, in turn, provide that data to energy suppliers who use that data to make judgments about your value as a customer. Additionally, Breakerbox hopes to continue to expand its range of free services which require your usage data (such as budgeting, tariff analysis, and bill analysis).

What are 100% Fixed Contracts?

In 100% Fixed contracts, barring certain exceptions, the price cannot be adjusted during the term of the contract. These contracts can be more expensive than contracts where certain variables are “Passed Through” because the supplier needs to be compensated for taking on more risk in locking prices for the customer.

What are 100% Passed Through contracts?

In 100% Passed Through contracts, the supplier has not taken the financial burden of the volatility risk on any price components. This means that the price the customer pays will vary from moment to moment for the term of this contract. 100% Passed Through contracts are generally less expensive but riskier for the customer than contracts in which certain price elements are fixed.

What are Semi-Fixed contracts?

In Semi-Fixed contracts,  the supplier has taken the volatility risk on some, but not all price components. This means that the price the customer pays for energy will likely vary over the term of this contract. Semi-Fixed contracts are a risk and reward middle ground between 100% fixed and 100% Passed Through contracts. By varying which elements are fixed or passed through, the customer can match their risk preference to the contract.

If I'm on a 100% fixed contract, how might the contract price change during the term?

Even though the supplier has fixed all of the price variables, the price of a 100% fixed contract may still change due to things including but not limited to the following: a change in law which materially changes the supplier’s costs to serve; a meaningful positive or negative change in the customer’s usage, outside of the allowance specified in the swing provision portion of the contract; the supplier going out of business (which would force a drop back to default prices); and force majeure. By working with Breakerbox, we’ll provide you with information that helps you understand how likely individual contracts are to experience price changes during their respective terms.

Why shouldn't I just pick the cheapest supplier?

There are several reasons why choosing a contract with the lowest price might not be a prudent strategy for managing risk and/or saving money. Breakerbox looks beyond the price and into other details that help you understand the total cost and risk associated with a complete contract. Contracts with low prices may include usage restrictions, may omit certain fixed price components, or may carry extra risk depending on the nature of the supplier – all of which could potentially lead to a higher total cost.

How else can I save money on energy?

Making smarter decisions about energy procurement is just one way to save on your energy costs. You can also save by using less energy, better managing capacity, and/or taking advantage of utility incentives. Breakerbox understands these opportunities in their respective market contexts and can work with you to create a custom plan that reflects your business’s unique opportunities and restrictions.

Can I reduce my carbon footprint by buying renewable energy?

Many businesses are establishing short- and long-term environmental goals or commitments. Purchasing from renewable energy sources is one way to contribute to those goals. The purchase of renewable energy certificates (RECs) demonstrates your commitment to environmental responsibility and supports your company’s goals. By adding RECs to your energy supply plan you are supporting the demand for new, clean, wind and/or solar power, able to match a designated percentage of your annual electricity use and able to make environmental claims about a reduction in greenhouse gas emissions associated with your annual electricity use, also known as “Scope 2” emissions.

Why is my contract start date an entire month?

Breakerbox defaults to displaying contract start dates as a month and year with a day specified. This is because the actual start date of your new electric contract will vary based on your meter read data and existing billing cycle.

Electric Service Quality

Can I lose power if I choose a competitive energy supplier?
Choosing to purchase energy from a competitive energy supplier will have no impact on the quality or consistency of the electrical service to your building(s).
What if my energy supplier doesn't provide enough energy for my business?
Suppliers have many options to ensure adequate quantities of energy are provided. Generally, they’ll employ a strategy which includes maintaining some “open” positions and then they’ll buy energy from the spot market to fill those positions. If these strategies fail though and your supplier isn’t supplying enough energy to the grid, the responsible energy Independent Service Operator (“ISO”) will step in to orchestrate generation coming on the grid to avoid a brown or black-out. Specifically, suppliers will provide energy to a utility zone, then the utility provides that energy to your meter. Electing to work with a competitive supplier will not change the likelihood of you experiencing a power outage.
Will I get to keep the same utility?
Yes! The company which is responsible for maintaining the poles and wires that bring power to your business will continue to do so, even if you leverage an energy supplier to control your energy risk and capture savings.

Contract Terms

Add/Delete governs the costs associated with a customer adding or deleting accounts to this contract. Usually there are additional costs associated with this action.

Ancillaries cover activities related to grid operations such as switching energy plants or maintaining voltage levels in transmission lines. Ancillaries may have additional sub-components depending on the Independent System Operator (“ISO”).

Assignment governs if a customer can assign this contract to a different legal entity or account. This usually applies to commercial real estate customers that may sell their property during a contract and would prefer not to incur early termination fees.
At the end of a contract term, a customer can either switch suppliers, sign a new contract, or provide written notice to terminate a contract. Auto-renew dictates what will happen if the customer does none of the above. Typically auto-renewed contracts carry additional margin for the supplier. This is not necessarily bad for the customer, provided the customer takes one of the above-listed actions.
Basis is the price difference between the Hub price and the Load Zone (where the energy is consumed). Depending on certain factors, Basis can be positive or negative and is less volatile than Hub prices.
Billing Options
There are typically three (3) billing options: “Utility Consolidated” means that your existing utility continues to bill you as they always have, but now the new supplier’s fees will replace the previous generation fees; “Supplier Consolidated” means that the supplier will bill you for both generation and the utility charges, all on one bill; and lastly “Dual Bill” means that both the supplier and your local utility will each send your their own bills and you’ll need to pay each separately.
Your “cap tag” or capacity tag is the amount of generation reserved for your company on the day on which the grid is stressed the most (a system-wide peak). In many markets, controlling your peak on the day that cap tags are set can create significant savings for your organization. Breakerbox not only helps you understand how much value there is in controlling your usage on these capacity setting days but also helps you find non-business-disrupting ways to lower your usage when it counts the most.
Change in Law
Change in Law determines whether the supplier has the ability to pass through charges or credits based on changes in laws for tariffs, rate calculations, fees at the ISO or government level. If Change in Law is “No” this means the supplier absorbs the charges or credits so that the customer’s rate does not change, lowering the risk to the customer. Not every contract will handle Change in Law the same way.
Credit Card Payments
Credit Card Payment refers to the customer’s ability to pay their bill using a credit card. Credit card payments typically force the supplier to incur additional fees so when suppliers offer Credit Card Payments, they usually increase costs elsewhere to compensate for this loss in revenue.
Generation is the market price for the amount of energy you consume (i.e. for the kWh on your monthly bill)
Holdover Rate
A Holdover Rate is the rate charged if a customer does not affirmatively select another term agreement after the initial term expires. It is possible that a contract has no auto-renewal language, but does have a Holdover Rate.
Hub Energy
Think of Hub Energy as the most fundamental cost of energy generation. The “Hub” is a group of nodes within a pre-determined region and at which the ISO calculates the Locational Marginal Prices (LMPs) which are then averaged to create a single pricing reference. Hub prices can be very volatile depending on the amount of load on the system and generation available.

Due to the principles of physics, some electricity is lost on its way from the generator to your meter. Accordingly, to make sure you have enough energy, the generator needs to generate a little bit more than what you’re going to use. If losses are passed through (instead of fixed) you would see either an additional line item on your bill or the bill would be multiplied by (1 + the loss percentage) to account for that lost volume. Line Losses can refer to both Transmission and Distribution Losses and will vary by Utility and Rate Class.

Supplier Credit Rating

The credit rating of the supplier is a key risk factor to consider when signing a contract. The higher the credit rating, the less likely the supplier is to go out of business. If a supplier were to go out of business while you were under contract with them, you would be immediately put back onto “default” or “provider of last resort” rates, depending on their state and utility. And these rates may be higher than the other rates you could have received. AAA is the best, and C/D is the worst.

Get a Free Consultation

If you are looking for help deciding on an energy contract feel free to send us a message and we will get back to you as soon as possible. When you engage one of our advisors we learn about your current costs and usage and talk you through your options. Book a time slot with one of our energy advisors and be prepared with your recent energy bill or any info about your current contract.

We are ready to help you with all your energy needs.

Contact Us


Live Chat

We are available to chat. Send us a quick message and we will get back to you instantly!