We've put together some of the basics about cancelation fees in Massachusetts when switching from one provider to another. We hope that this information will enable you to find the best MA electric rates and services for your energy needs.
First of all, you may have heard about exorbinate cancellation fees charged by electricity suppliers in MA. In the past, customers would sign up for a new service, enticed by the attractive Massachusetts rates. But when they tried to cancel their plan, they would be hit by a high termination fee. The good news is that this is not the case anymore - which we will go into a little later.
Massachusetts Electricity Switching The rules
The Department of Public Utilities (DPU) take care of the public's right to reliable and safe energy. In Massachusetts, this means DPU cover the utility companies that transmit the electricity sold in the state. These companies are NSTAR, Eversource and WEMCo.
NSTAR, Eversource and WEMCo will give consumers their power if they do not sign up to an alternative supplier. They are what is known as standard service suppliers, and they charge a fixed fee which can change every six months. However, you can change your provider to an alternative and enjoy better rates.
But this is where cancellation fees come in. DPU does not allow NSTAR, Eversource and WEMCo to make a profit from the electricity they provide you via other suppliers. So, there are no enrollment or cancellation fees applicable when you move to or leave them. But other companies don't have these restrictions, and the charges tend to be market led. One company might charge nothing, while another might charge $25, and so on.
Massachusetts Cancellation fees
Having said that, there is a slight restriction. Business users will find their alternative energy supplier can charge them uncapped cancellation fees. But if you want to terminate as a residential customer, you will only pay a maximum of $50. It means that consumers can budget their switches accordingly. They could even save money in the long-term by canceling one contract and entering another.
There are some other rules that suppliers have to follow that might involve cancellation. For example, providers must notify you about a change in your generation rate when your fixed term plan is coming to an end. Also, consumers and businesses can only switch contracts once every month.
You should also be aware that switching can only occur if the date of your next meter reading. This means you should start the switching process ten days before your next meter reading. It will give both suppliers the time to verify your information.
Finally, make sure you understand that you could end up paying a cancellation fee and an enrollment fee. Some electricity suppliers in Massachusetts charge for one, some the other, and some might charge you for both. Make sure you understand the costs involved. Sometimes, it might be cheaper to go back to the standard service before switching suppliers directly.