A fixed energy rate plan allows you to avoid the uncertainty of changing energy prices and pay the same fixed rate monthly for your energy usage.
Energy rates can change due to a lot of factors, many of which are unforeseeable and can cause a drastic change in the price of energy. Government policy, trade wars, natural disasters, and many other unanticipated happenings can cause the price of energy to skyrocket. As a homeowner, you would surely want a level of consistency when it comes to your bills. The fact that so many things out of your control affect your monthly spending may give you anxiety. Fixed energy rate plans allow for you to have peace of mind by knowing that your energy rate will remain unchanged by whatever is currently happening in the world.
Fixed rate plans allow you to pay the same rate each month so that you’ll never have to do any guesswork and are in for no surprises. These plans are designed for those who want to budget for the future and want some peace of mind when it comes to their home expenses.
How do Fixed Energy Rate Plans Work?
Lucky for you, as a Canadian you have many different energy companies to choose from which have various pricing plans to offer. A fixed rate energy plan is one of the most simple plans that are offered and will give you a reliable monthly rate for your energy usage.
Fixed energy rate plans work by providing you with a single, fixed rate for the period specified in your contract, usually ranging from 1 to 5 years in length. Fixed rate plans charge you the same amount for every kilowatt hour of electricity or unit of natural gas used in your household.
On the other hand, variable rate plans will charge you a rate based on the current market price of energy which will fluctuate month to month according to the supply and demand in the market.
With a fixed rate plan, as long as your household is consistent with your electricity usage then you will be paying the same amount for energy now as you will be years in the future. This is the benefit of a fixed rate plan. No matter what happens in the market, your rate is held secure at the price you signed up for. No spontaneous event will be able to change the amount you pay for your energy. This makes budgeting easy and leaves you with one less thing to worry about.
A fixed rate plan will be priced at a slightly higher rate than a variable rate plan, but you know that this rate will never change even if worse comes to worst in the energy market. With variable rate plans there is a level of uncertainty which doesn’t exist with a fixed rate plan. This stability is what makes it an attractive option for many homeowners.