Fixed vs Variable Electricity Rates — April 2026

What each plan type actually is

In a retail-choice state your bill splits in two. Delivery — the poles, wires and meters — stays with your local utility no matter what you sign; it is regulated and not shoppable. Supply — the electricity itself — is the part a competitive supplier sells you, and it is the only part a plan changes.

A fixed-rate plan quotes one supply price per kWh and holds it for a contract term. The supplier takes the risk that wholesale costs rise during that term, and prices that risk into the number it quotes you — a fixed rate is not the market price, it is the market price plus the cost of the guarantee. Your bill still moves month to month, because your usage does; the rate does not.

A variable-rate plan resets the supply price on the supplier's schedule, typically each billing cycle. Contract terms usually give the supplier discretion over how the new price is set, and there is generally no ceiling written into the plan unless the plan says there is. That cuts both ways: when wholesale costs fall you see it quickly, and when they spike you carry it immediately.

The third option is doing nothing. If you never sign with a supplier you stay on your utility's default service — the standard offer, basic service or price-to-compare, depending on your state — which is procured under rules set by your regulator and reset on a published schedule. That default is the benchmark any offer has to beat, and it is a legitimate answer to keep.

Whether you get to choose at all

Residential retail choice exists in these 14 jurisdictions, 7 of which are also in the PJM Interconnection footprint and therefore carry the capacity charge discussed below:

• Connecticut
• Delaware*
• District of Columbia*
• Illinois*
• Maine
• Maryland*
• Massachusetts
• New Hampshire
• New Jersey*
• New York
• Ohio*
• Pennsylvania*
• Rhode Island
• Texas

* In the PJM footprint (all or part of the state).

Choice is not the same thing everywhere on that list. Where a jurisdiction constrains it, here is the constraint:

• Illinois — ComEd in PJM; Ameren territory in MISO.
• Maryland — Maryland's SB1 (2025) caps retail supplier prices below the standard offer and limits contracts to 12 months, so supplier offers are limited.
• Massachusetts — A ban on individual residential supplier sales is under debate in the state legislature.
• New York — NYISO, not PJM; ESCO retail choice.
• Texas — ERCOT - the largest retail-choice market. Choice covers the competitive ERCOT zones only; Austin, San Antonio and El Paso are served by their own utilities.

And these jurisdictions are commonly mistaken for choice markets. They are not, for the reasons given:

• California — Community Choice Aggregation, not classic retail switch.
• Georgia — Natural-gas choice only; electricity regulated.
• Michigan — Retail choice is capped at 10% of load and the cap is full - effectively no supplier switching for new residential customers.
• Nebraska — Public power; no investor-owned utilities.
• Tennessee — Largely TVA; retail choice minimal.
• Virginia — Virginia is in PJM and carries the capacity increase, but residential supplier choice is effectively closed.

If your state is not on the first list, this decision is not available to you and no amount of shopping will change your supply price. The lever that still works is the usage side: what your biggest loads actually cost per month at your state's price is in the cost-to-run guides, and your own state's dated average is on its state page.

What people in those states are paying now

Before comparing offers, know the ground truth for your state. These are the average residential prices EIA reported for April 2026, with the change from a year earlier:

14 of 14 choice jurisdictions reported by EIA for April 2026; any not reported show a dash and are never counted as zero. Important when comparing: this is average revenue per kilowatt-hour across all residential sales, so it reflects the whole bill including delivery — a supply-only offer quoted at a lower number is not automatically cheaper than this. Source: U.S. EIA residential retail sales.

The honest trade-off

The case for fixed is budget certainty. You know the supply price on every bill for the length of the term, which matters most if a price spike would actually hurt — a tight budget, electric heat, a hot-summer household. The case against is that you pay for that certainty in the quoted rate, and you give up the downside: if supply costs fall during your term, you keep paying the price you agreed to.

The case for variable is that you follow the market both ways and you are not locked into anything. The case against is that the same freedom applies to the supplier: the price can reset upward on the next cycle, and an introductory rate that expires into an open-ended variable price is the single most common way a bill jumps without any change in usage.

There is one piece of the future supply price that is not a guess. In the PJM footprint — which covers 7 of the 14 choice jurisdictions — capacity prices are set years ahead at auction. Measured against the 2025/2026 price already inside April 2026 bills ($269.92/MW-day), the delivery years still ahead convert to:

• 2026/2027 delivery year (Jun 2026 - May 2027)+0.41¢/kWh
• 2027/2028 delivery year (Jun 2027 - May 2028)+0.44¢/kWh
• 2028/2029 delivery year (Jun 2028 - May 2029)+0.38¢/kWh

RTO-wide Base Residual Auction clearing prices converted at the documented system load-factor assumption, measured against the price in effect at the April 2026 data month — a delivery year that has already started is in your bill, not ahead of it, and is never counted twice. Several utility zones cleared higher, so treat these as a floor. Full arithmetic in the capacity charge explainer.

What that does not mean is “lock in now and beat the increase.” These auction results are public, and suppliers quoting fixed rates today can read them exactly as you can, so a known future cost is already reflected in what they offer. Two things are genuinely worth knowing, though. First, the 2026/2027 step is an increase, so a variable price is more likely to move up than down on that component when the delivery year begins. Second, where the capacity cost lands on your bill varies: some utilities pass it through inside the supply rate, others as a separate line. If yours puts it outside supply, a fixed supply price does not touch it at all. Note also that the steps above do not all move the same way — the schedule is a sequence of auction results, not a trend.

Questions to ask before you sign

• Does this rate cover supply only? Almost always yes. Delivery charges, customer charges and state taxes stay on your bill regardless, so a quoted rate is never your all-in cost per kWh. Compare supply quotes against your utility's default supply price — the price-to-compare on your bill — not against your bill total or the state average above.
• How long is the term, and what is the exact end date? Write it down. A term is the entire value of a fixed rate, and it is the only part of the offer with a hard expiry you have to act on.
• What happens at expiry? This is the question that costs people money. Many fixed contracts roll onto a month-to-month variable price when the term ends, and that rollover price is set by the supplier. Ask whether the plan auto-renews, what it renews onto, how much notice you get, and set your own calendar reminder for a month before the end date. An expired introductory rate is one of the standard causes covered in why did my electric bill double.
• Is there an early termination fee? Get the amount, in dollars, and whether it scales with months remaining. A fixed rate you cannot leave without a penalty is a different product from one you can.
• Are there monthly fees, minimum-usage charges or usage credits? A low headline rate paired with a monthly service fee, or a bill credit that only triggers above a usage threshold, changes your effective price — and changes it most for low-usage households.
• For a variable plan: how is the new price set, and when do I learn it? Ask what the price is indexed to, if anything, whether there is any cap, and whether you are notified before or after the change lands on a bill. If the contract gives the supplier full discretion, that is the answer — treat it accordingly.
• Who is the supplier, and where is their complaint record? Your state utility commission licenses retail suppliers and publishes both the licensee list and complaint data. That is the authoritative source on who you are signing with, and it is free.

How to compare honestly

Compare total cost over the whole term, not the headline rate. Take your own kWh from twelve months of bills — your utility's online account has them — and run each offer against that usage, adding every monthly fee and subtracting only the credits you would actually qualify for. Offers are designed to look best under the usage pattern that suits them, so the only usage pattern worth testing is yours.

Then check three things that decide the comparison more often than the rate does: the price against your utility's default supply price rather than against another supplier, the end date and what follows it, and the early termination fee. A plan that wins on rate and loses on rollover is a plan that wins for one year.

Finally, be honest about the size of the prize. Switching only moves the supply portion of your bill. If your usage is high for your home's size, the usage side is usually the bigger and more permanent lever — and unlike a contract, it does not expire.

Start from your own numbers

Enter your state and monthly bill to see where you stand against your state's dated average and which increases are already locked in for you — the baseline any offer has to beat. Every line is sourced and dated, and nothing you type is stored.

Where to compare

Plan comparison partners coming soon. In the meantime, your state utility commission publishes an official supplier price list for most choice markets, and it is the one comparison nobody is paid for — start there.

Keep going

• Why is my electric bill so high? — the full usage-vs-price diagnosis, with the national numbers.
• Why did my electric bill double? — the realistic causes of a true 2x jump, expiring plans included.
• The PJM capacity charge, explained — the auction that fixes part of your future supply cost years ahead.
• Electricity bill increases through 2027 — all 51 jurisdictions ranked, with the method and the CSV.