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The Missed Opportunity in Deregulated Energy Markets: Why Businesses Still Overpay for Power.

  • Sophic Analytics
  • Jul 6
  • 2 min read

Deregulated power markets were supposed to unleash competition and cut costs. Two decades later, commercial electricity prices are the highest on record — averaging 13.13 ¢/kWh in April 2025 and rising nearly 5 % year-over-year for the typical U.S. business.

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So where’s the disconnect? Most firms never shop the market. EIA’s Form 861 data show that, outside of Texas, well under half of eligible commercial load is actually served by competitive suppliers; many simply stick with the utility’s default “pass-through” rate each time a contract expires. Industry researchers call participation rates in retail-choice states “low in most sectors,” even a decade after the rules changed.


That inertia is expensive. In hundreds of live reverse-auctions run by brokers and large corporates in 2023-24, suppliers bid retail power down an average 15–20 % below incumbent offers—savings that drop straight to EBITDA.


The real missed opportunity

Every CFO running a 5 % net-margin business knows: a one-cent swing in power costs on a one-million-kWh annual load is $10 000 straight to the bottom line. Nationally, that’s a $15 billion untapped pool of cash for small and mid-sized enterprises that haven’t yet left the default supply plan.


How to capture it

  1. Audit your last twelve months of utility invoices—look for the “price to compare” line and contract end date.

  2. Engage a broker or digital auction platform 60–90 days before renewal; require at least five competitive bids.

  3. Model fixed vs. blended strategies against your risk tolerance and sustainability goals (green PPAs often price below utility brown power today).

  4. Lock multi-year terms when forward curves dip. In ERCOT, wholesale prices collapsed 52 % in 2024; customers who locked three-year deals then are still paying single-digit cents.

  5. Set a calendar reminder halfway through the contract to reassess market conditions; never roll into month-to-month default rates.


Bottom line

Deregulation handed businesses a lever to cut energy spend—but only those who pull it see the savings. With commercial power prices at record highs and suppliers still willing to under-bid one another for stable load, leaving procurement on autopilot is no longer just inertia; it’s a margin leak you can’t afford. Stop financing the utility’s balance sheet and start treating electricity like any other competitively sourced input.


Ready to see what the market will really pay for your load profile? A half-hour reverse auction could be worth a double-digit dent in next year’s utility budget.


To learn more, contact us at www.sophicanalytics.com



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