How to avoid energy scams

As more and more states jump on board and become deregulated, two questions come to mind; “Why didn’t they think of this concept earlier?” and “Why aren’t more states deregulated?”

Texas has been deregulated since 2001, but the concept of being able to choose an energy provider is still a new concept to a lot of people. They don’t always know how to go about choosing the best discount electricity rate and provider.

Many people are split over whether or not deregulation is a good thing and maybe it’s because of the old saying, “If it sounds too good to be true, it probably is.”

Perhaps they’re afraid of it turning into a scam, or a pyramid scheme, much like the Ambit Energy Scam.

If that’s the case, it’s understandable, but you’re just as likely to get scammed if you settle with a company based on your location.

The Ambit Energy Scam occurred when individual employers of Ambit Energy got greedy and decided to take advantage of the new deregulation concept. These individuals were showing their customers low rates for the first month or two without telling them the rates would soon increase.

Thinking those rates were permanent, the customers signed the deal and locked themselves in for the long run.

Before too long though, they realized their rates were increasing significantly and they couldn’t get out of the deal without breaking their contracts, and the customers received individual bonuses for each new customer.

Some people argue that deregulation provides an opportunity for the individual companies to monopolize and overtake the smaller local companies.

The flip side of that argues it’s a good thing because it allows companies to expand into areas it wouldn’t have otherwise and provides an opportunity for customers to choose the best discount electricity rates in their area.

In order to avoid a scam, it’s best to go through a consulting group, or someone else who’s not necessarily affiliated with a specific energy provider. That way, you know there’s no benefit for that consultant based on what provider you choose.

Overall, the concept of deregulation is pretty American if America is the “Land of Opportunity.”

It’s kind of like what former president, Ronald Reagan said, “Government is not the solution to the problem, government is the problem,” and at least in deregulation, it’s not up to the government when it comes to who we choose a provider.

last time modified: Sept. 15, 2011, 4:12 p.m.