Understanding the Basics of Electricity Pricing

Understanding the Basics of Electricity Pricing

If you require a detailed analysis of your electricity pricing, get the help of the experts at Alternative-Esco today. It's important to understand the factors that affect wholesale electricity pricing so that you can make informed decisions in the future. Rely on us to complete our services within 1-2 days or before your next billing cycle.


You can count on us to help you with finding the perfect solution to optimize your electricity usage. You'll find a list of the main components of a wholesale electricity price listed below. Get in touch with us to learn more.

Energy Cost Components

  • Energy: the actual commodity consumed by the customers
  • Capacity (reliability): ensuring the availability of resources for dispatch
  • Ancillary services: additional services for perfect functioning of the grid
  • Transmission congestion and losses: the cost associated with
  • Delivering power across congested transmission lines with insufficient capacity
  • Losses from transmitting power over a distance



Although there will be different methods to account for these components, they will always be incorporated into the price somehow. In most cases, energy accounts for the majority of the price, followed by capacity. Depending on the situation, other components can contribute considerably to your electricity price.

Get Wholesale Electricity at the Right Price

You can be confident that our experts will help you understand the factors that influence wholesale electricity pricing. With our help, you'll be able to understand the importance of time-of-use pricing and services such as demand response.


You can be confident that you'll be able to decide on a long-term price or variable rates after understanding the trends that shape your local market. Don't worry, our professionals will be there to assist you throughout the process. Our staff attends ongoing training. Contact us for further information.