Supply vs delivery: which half of your bill you can actually change

Contestable

Supply

The electricity itself. In a competitive market this is what a licensed supplier quotes, contracts and competes for.

Set by: your supplier, or default service

Not contestable

Delivery, demand, fixed charges, riders

The wires, the poles, the substations, the meter and the crew who restore your service. Charged under a tariff filed with and approved by your state regulator.

Set by: the regulated utility — unchanged by switching

Both halves arrive on the same meter and often on the same bill, which is why they get treated as one negotiable number. Only the left half is.

How big the delivery part really is

The diagram above is the structure. Here are the proportions, measured. The U.S. Energy Information Administration reports the supplier's energy revenue and the utility's delivery revenue separately for businesses that buy from a competitive supplier. Across the 15 markets where it does, delivery is between 25% and 58% of the average commercial price, 44% at the median. Whatever a supplier quotes, that part is not in play.

• California 58% 12.58¢ energy + 17.07¢ delivery
• Connecticut 54% 10.80¢ energy + 12.53¢ delivery
• Rhode Island 51% 11.02¢ energy + 11.61¢ delivery
• New Hampshire 49% 10.29¢ energy + 9.76¢ delivery
• Massachusetts 48% 12.38¢ energy + 11.40¢ delivery
• New York 48% 10.10¢ energy + 9.25¢ delivery
• Maine 48% 10.29¢ energy + 9.42¢ delivery
• District of Columbia 44% 11.15¢ energy + 8.70¢ delivery
• Illinois 41% 7.38¢ energy + 5.10¢ delivery
• Ohio 40% 6.67¢ energy + 4.39¢ delivery
• New Jersey 34% 10.73¢ energy + 5.46¢ delivery
• Maryland 33% 9.31¢ energy + 4.65¢ delivery
• Michigan 30% 8.11¢ energy + 3.46¢ delivery
• Delaware 26% 8.17¢ energy + 2.90¢ delivery
• Pennsylvania 25% 8.51¢ energy + 2.89¢ delivery

Energy — what suppliers compete onDelivery — set by the utilityEIA, 2025 annual

Source: U.S. Energy Information Administration, Form EIA-861, 2025 annual data. Averages across all commercial customers in each market: dated context, not a quote. EIA does not split energy and delivery for every market, so some states, Texas among them, are not shown.

What the supply portion actually is

Supply, also called generation or energy, is the cost of the electricity itself. In a competitive retail market this is the portion a licensed supplier competes for, quotes on and contracts with you to provide. It is typically expressed in cents per kilowatt-hour and it scales with how much electricity you consume.

This is the only part of a commercial electricity bill that a supplier can change. Everything a retail supplier says about your bill is, correctly understood, a statement about this portion.

What the delivery portion is, and why no supplier can touch it

Delivery is the cost of getting the electricity to you: the wires, the poles, the substations, the meter and the people who restore your service at two in the morning. Your local utility owns that infrastructure whether or not you buy supply from someone else, and it charges for it under a tariff filed with and approved by your state regulator.

On a commercial account the delivery side is rarely one line. It typically comprises:

• A fixed customer or meter charge, which does not move with consumption at all.
• A volumetric distribution charge per kilowatt-hour, which scales with how much you use.
• A demand charge per kilowatt where the account is demand-metered, which scales with how hard you draw rather than how much you use.
• Riders and surcharges, adjusted periodically through regulatory filings, covering items such as transmission cost recovery, efficiency programs and system restoration.

Switching suppliers changes none of these. That is not a loophole or a bad deal; it is how the market is structured. Delivery is a regulated monopoly service and it is priced by the regulator, not by competition.

Why the split matters more than the supply rate for many accounts

If supply is 80 percent of your bill, a better supply rate is the main event. If supply is 45 percent of your bill, a ten percent improvement on the supply rate moves your total bill by four and a half percent, and the other 55 percent sits untouched.

Which situation you are in is determined largely by your load shape. An account that draws steadily around the clock — a cold store, a data facility, a continuous process — accumulates a great deal of consumption relative to its peak, so the volumetric supply charge dominates. An account that concentrates its draw into short bursts — a restaurant at service, a workshop running heavy equipment intermittently — pays disproportionately for demand, which is on the regulated side.

This is measurable rather than a matter of opinion. It is called load factor, and it is a single division you can do from your own bill.

What attacks the regulated half

The regulated half is not fixed, it is just not contestable through a supplier. Four things move it:

• Rate schedule fit. Utility tariffs offer several commercial schedules with different balances of fixed, volumetric and demand charges. An account on the wrong one for its load shape pays more for the same electricity. This is checkable against publicly filed tariffs.
• Peak demand management. Lowering the highest interval, not the total consumption, is what reduces a demand charge.
• Billing accuracy. Meter multipliers, customer classification and misapplied riders are more common than most operators expect, and they compound silently.
• Power factor on motor-heavy sites, where a tariff penalty may apply below a threshold.

None of this requires a competitive supply market, which is why it is available in fully regulated states on exactly the same terms. It is also work that earns a supplier nothing, so a supplier has no reason to raise it.

How to read your own split

Find the supply section and the delivery section on your bill — they are usually grouped, and in some markets they arrive as two separate bills entirely. Add up each side. Divide each by the kilowatt-hours for the period to get a supply effective rate and a delivery effective rate.

Two cautions. If supply and delivery arrive separately, you need both; a comparison built on one of them is incomplete. And never compare your all-in bill rate against a supply-only quote — that comparison always makes the quote look better and it is not a like-for-like.

Common questions

Does switching electricity suppliers lower my delivery charges?

No. Delivery charges, demand charges, fixed customer charges and riders are set by the regulated utility tariff and do not change when you switch suppliers. Only the supply portion changes.

What percentage of a commercial electricity bill is supply?

It varies widely by account and load shape. Accounts with steady consumption relative to their peak tend to have supply dominate the bill, while accounts with short sharp peaks carry a much larger share in demand and delivery charges. It is computed from your own bill rather than assumed.

Who fixes an outage if I switch suppliers?

Your local utility. It continues to own the wires, the meter and the outage response regardless of who supplies your electricity, and it is charged for under a regulated tariff.

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