Energy provider vs. energy supplier: The difference is deregulation

Once upon a time in the not-too-distant past, natural gas customers had but one provider available to them, offering one price. No choice. That’s it. The deregulation of the natural gas markets in the 1980s opened the door for competition, giving rise to the independent energy supplier. Since then, natural gas marketing has become an integral part of the natural gas industry, helping to ensure a flexible, transparent, and competitive natural gas market.

Provider is your utility

A traditional public utility simply takes orders for natural gas according to rate and price schedules approved by the public utilities commission. Public utilities must abide by and react to rate changes, and pass them to their customers, for better or worse, lower or higher. The utilities are also responsible for further building and maintaining of the natural gas distribution system, and for performing safety inspections and emergency services, should they be needed.

Suppliers are resellers

Natural gas suppliers, also called marketers, actively sell natural gas – whether of their own production or aggregated from other sources – to other resellers, or directly to end-users. Suppliers are not bound by the restrictions or responsibilities of a utility. They have the ability to set their own price for natural gas based on competitive market forces, usually resulting in lower prices than the utility is able to offer.

Why does that matter?

At the end of the day, utilities and suppliers are providing the same commoditized product: natural gas. The difference comes in the supplier’s ability to offer better pricing, more stability, and excellent customer service.