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Discovery Energy · Energy procurement

Deregulated electricity and natural gas states for businesses

Where a commercial or industrial company can buy electricity or gas from a competitive supplier, which grid each state sits in, where brokers must be licensed, and what to do in states without choice.

About 19 states and the District of Columbia allow at least some commercial and industrial customers to buy electricity from competitive retail suppliers, according to the U.S. Energy Information Administration, and in the ERCOT region of Texas customers of investor-owned utilities must choose a retail provider. Large commercial and industrial customers can buy natural gas from a supplier in most states through the utility's transportation service. Discovery Energy Utility Audits buys electricity and gas for multi-site companies in the deregulated states and audits utility bills in every state.

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States with competitive electricity supply for businesses

The table lists the states where commercial and industrial customers of the main investor-owned utilities can choose an electricity supplier, the grid operator that sets wholesale prices and capacity costs, and whether brokers are licensed or registered there. Municipal utilities and cooperatives are usually outside retail choice even in these states. Each state links to its page in Discovery's U.S. electric utility directory, which lists every utility in the state. Ohio, Pennsylvania, Illinois, New Jersey, Maryland, Texas and Connecticut also have full buying guides covering utilities, default service, capacity costs, natural gas and licensing.

Commercial and industrial electricity choice by state (November 2026)
StateGrid operatorBusiness electricity choiceBroker or consultant rules
Connecticut (utilities)ISO-NEYesRegistration with PURA
DelawarePJMYes (Delmarva Power territory)Electric supplier certificate (broker) from the Delaware PSC
District of ColumbiaPJMYesElectricity supplier license from the DC PSC, which covers brokers and aggregators
Illinois (utilities)PJM (ComEd), MISO (Ameren Illinois)YesAgent, broker and consultant license with the ICC
MaineISO-NEYesLicense as a competitive electricity provider from the Maine PUC, which covers brokers and aggregators
Maryland (utilities)PJMYesBroker license with the Maryland PSC
MassachusettsISO-NEYesBroker license with the DPU
MichiganMISOLimited: retail open access is capped at about 10% of each utility's load, with waiting listsAlternative electric suppliers licensed by the Michigan PSC; ask brokers how they are registered
New HampshireISO-NEYesRegistration with the NH PUC
New Jersey (utilities)PJMYesEnergy agent registration with the BPU
New YorkNYISOYesRegistration and fee disclosure (Public Service Law §66-t)
Ohio (utilities)PJMYesCertification with the PUCO
Pennsylvania (utilities)PJMYesLicensed as electric generation suppliers by the PA PUC
Rhode IslandISO-NEYesRegistration with the RI PUC
Texas (utilities)ERCOTYes in competitive ERCOT areas (Oncor, CenterPoint, AEP Texas, TNMP); customers there must choose a retail providerRegistration with the PUCT
CaliforniaCAISOLimited: Direct Access is cappedElectric service providers register with the CPUC
OregonNone (bilateral West)Limited: direct access for nonresidential customers of the two investor-owned utilities, within program limitsElectricity service suppliers certified, and aggregators registered, by the Oregon PUC
NevadaNone (bilateral West)Limited: large customers may leave the utility with commission approval and exit chargesCheck with the PUCN
VirginiaPJMLimited: mainly large customers, under conditions set by state lawCompetitive service providers and aggregators licensed by the SCC

Rules change. Program caps, eligibility thresholds and licensing requirements are set by each state commission, so confirm them for each account before you plan a purchase, and ask any broker you hire for its license or registration in each state. Michigan's program has been at or near its 10% cap at every participating utility, so new customers join a queue; in Virginia, retail choice for most customers ended in 2009.

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Natural gas: transport service and choice programs

Gas works differently. Large commercial and industrial customers have been able to buy gas separately from delivery for many years in most states, usually under the utility's transportation tariff, which sets the minimum volume, metering and balancing rules. Many states also run choice programs that let smaller businesses and households pick a gas supplier. In the Atlanta Gas Light territory in Georgia, every customer buys gas from a marketer.

Before planning a gas purchase for a site, check three things in its utility's tariff: the transport eligibility threshold, the balancing and imbalance rules, and whether firm and interruptible service are available. Discovery's natural gas procurement page explains each, and the gas capacity outlooks rate winter delivery capacity in 48 metros.

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Why the grid operator matters as much as the state

Two deregulated states can price electricity very differently because their grid operators run different markets. In PJM, capacity is bought in a forward auction and charged through each account's peak load contribution; the 2028/2029 auction cleared at the $325 per MW-day cap. In MISO, the seasonal auction set annualized prices of $116 to $126 per MW-day for 2026/27. ERCOT has no capacity market, and transmission follows the four summer peak intervals. A procurement plan for a multi-state company is really a plan for each grid. See charges by market.

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What to do in states without choice

In most of the Southeast, the Mountain West and much of the Midwest, the utility sets the price through its tariff and there is no supplier to switch to. Savings there come from checking how the tariff is applied: the rate class, riders and exemptions, demand ratchets, power factor, meter multipliers and seasonal rates. A utility bill audit tests every account against the tariff and recovers past overcharges, within a look-back set by each state; see utility refunds by state. A free rate class check is the quickest first step.

A multi-state company usually needs both: procurement in deregulated states and a tariff audit everywhere. Discovery runs both on one account inventory, which is why the multi-state RFP and the audit start from the same list of accounts.

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Questions about deregulated states

Which states have deregulated electricity for businesses?

Connecticut, Delaware, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island and the competitive areas of Texas offer broad choice to commercial customers. California, Michigan, Nevada, Oregon and Virginia allow limited choice.

Can a business choose its natural gas supplier?

Large commercial and industrial customers can in most states, through the utility's transportation service. Smaller businesses can in states with gas choice programs.

Does deregulation mean lower prices?

It means competition for the supply portion. The utility's delivery charges stay regulated, and the supply price still follows wholesale markets, including capacity costs. Buying well, and on the right terms, is what lowers cost.

Do brokers need a license?

In several states, yes. Pennsylvania, Texas, Ohio, New York, Illinois, Maryland, Massachusetts, New Jersey, Delaware, the District of Columbia, Maine and Virginia, among others, license or register brokers, consultants or aggregators. Ask any broker for its license in each state where it will act for you. Discovery Energy's energy broker licenses and registrations are held by Energy Auction Exchange, LLC.

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