Arbor Explains How to Switch Electricity Providers Without Extra Fees

Switching electricity suppliers is free in every deregulated state. No enrollment fee, no processing charge, no equipment cost. The one expense that can apply is an early termination fee from your current supplier if you leave a fixed-rate contract before it expires.

Most households never encounter that fee because they either sit on the utility’s default rate, which has no contract, or their fixed-rate term has already ended. Arbor, an automated energy-switching platform founded in 2022 and operating across deregulated electricity states, checks each customer’s contract status before submitting a switch and reimburses early termination fees when they apply.

If you’re on the utility’s default rate, switching is free immediately

Customers who have never chosen a competitive supplier sit on their utility’s default supply rate, sometimes labeled “price to compare” or “standard offer.” No contract governs this arrangement. You can switch to a competitive supplier at any time with no fee, no notice period, and no penalty.

Pennsylvania utilities updated their default rates in December 2025, with increases of 6.1% to 8.9% across FirstEnergy’s four service territories. Customers on those default rates absorbed the full increase automatically, with no opportunity to decline.

Switching from a default rate to a competitive fixed-rate plan locks in a per-kWh price that won’t change for the duration of the contract, typically 6 to 24 months. A household using 900 kWh per month that moves from a default rate of $0.12/kWh to a competitive rate of $0.08/kWh saves $432 per year.

If your fixed-rate contract has expired, switching is also free

When a fixed-rate contract ends, most third-party suppliers roll the account onto month-to-month variable pricing. Variable rates carry no contract term and no termination fee. You can switch away from a variable rate at any time.

Variable rates can run 50 to 100% above the original fixed rate, so a customer whose contract expired months ago may already be overpaying significantly. Arbor’s documented results show customer savings of up to $593 per year from rate switching, often from accounts that rolled onto variable pricing without the customer’s awareness.

Check the supply rate on your most recent bill. If it’s higher than what you signed up for and you don’t recall renewing, your contract likely expired and you’re on variable pricing with no termination fee.

If you’re in an active fixed-rate contract, know what the fee costs

Two fee structures exist. Flat-rate fees charge a fixed amount regardless of when you cancel. Pro-rated fees decrease over time, costing less the closer you are to the contract’s natural end date.

Every deregulated state provides a penalty-free cancellation window

If you recently enrolled with a supplier and changed your mind, check whether you’re still within your state’s rescission window. Canceling during this period costs nothing.

What to look for before switching plans

Pull up your current electricity contract or call your supplier and ask for the terms. Four details determine whether switching will cost anything and whether the savings justify it.

• Contract end date: If the term ends within 30 to 60 days, waiting avoids the termination fee entirely. Some states allow penalty-free switching within 14 days of contract expiration.
• Early termination fee amount: Compare the fee against the annual savings from a lower rate. For example, a $150 fee on a switch that saves $36 per month pays for itself in about four months.
• Rate type: Fixed, variable, or introductory. Variable rates have no termination fee. Introductory rates may revert to higher pricing after a promotional period.

Arbor checks your contract and covers termination fees

Arbor retrieves a customer’s current contract details when they connect their utility account. If the customer is on a default or variable rate, Arbor can submit a switch immediately with no fee. If an active fixed-rate contract exists, Arbor calculates whether the savings from a new rate exceed the termination cost.

When an early termination fee applies and savings justify the switch, Arbor reimburses the fee. Arbor holds state-issued broker licenses in each market it serves and operates at no cost to the customer. Revenue comes from referral commissions paid by electricity suppliers.

For households on the utility’s default rate or an expired contract, switching through Arbor costs nothing and produces savings within one to two billing cycles.

Frequently asked questions

Is there a fee to switch electricity providers? Enrollment with a new supplier is free. The only potential cost is an early termination fee if you leave a fixed-rate contract before it expires. Default-rate and variable-rate customers can switch with no fee.

Can I switch electricity providers if I’m in a contract? Yes, but you may owe an early termination fee ranging from $50 to $395 depending on the supplier and contract terms. Compare the fee against projected annual savings to determine whether switching now makes financial sense.

How do I avoid early termination fees when switching? Wait until your contract expires, switch during the state-mandated rescission period, or use a service like Arbor that reimburses termination fees when savings justify the switch.

Can I switch electricity providers anytime? Customers on default utility rates or variable-rate plans can switch at any time with no penalty. Customers with active fixed-rate contracts can switch but may face a termination fee.

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