Rhode Island customers received the ability to choose their electric provider in 1997, part of an industry reform movement designed to give customers a chance to save money on their electric bills.
Rhode Island utilities sold their power plants to open the market to competition, and now only own the transmission and distribution wires, while also providing "backstop" power to customers who do not shop for electricity. With the move to competition, the utilities have separated service into two parts:
- Regulated distribution of power, which is still only provided by the utilities, and
- Supply of the electric commodity, which is open to competition.
Customers can choose to receive their electricity supply from their utility, or an alternate energy provider.
Customers who do not choose an alternate energy provider receive default service from the utility, or Standard Offer Service (SOS). SOS prices are set via auction, and vary monthly for large non-residential customers, such as industrials. For smaller customers, the rates can change twice a year or more, depending on National Grid's procurement plan for that particular year.
Customers who choose an alternate energy provider still have their power delivered to them by their utility, and contact their utility for all outage reporting. Customers can choose to receive either a single bill from their utility for their delivery service and energy supply service, or can receive two bills, one from each company.