Luring customers in with low rates, only to raise those rates once the customer has been acquired, is a common tactic known as bait-and-switch. It is particularly effective in hooking low-income and elderly customers who have a fixed budget because they are most often the people who are on the lookout for the best deal. Unfortunately, when a deal seems like it might be too good to be true, the sad fact is that it usually is.
When ComEd announced earlier this year that it would be raising its rates by 21 percent, the number of people looking for a deal jumped dramatically. Unfortunately, many companies took advantage of this jump by promising low rates. However, because many of these companies are unregulated, they can raise their rates later by as much as they want, when they want. They don’t even have to provide their customers with an explanation for the raise in rates.
ComEd’s rates recently went up from 5.5 cents per kilowatt-hour to 7.6 cents per kilowatt-hour. A kilowatt-hour is the amount of energy required to power a medium-sized window AC unit for one hour. The average ComEd customer uses 655 kilowatt-hours per month. Despite Starion’s claims that customers can save money by switching to Starion Energy, Starion’s average rate is allegedly 13 cents per kilowatt-hour, almost double ComEd’s price. Continue reading