In the restructured energy market the different responsibilities of the utility company are “unbundled” and the power industry is separated, typically into four divisions: energy services, transmission, distribution and generation.
The transmission and distribution sectors however, remain subject to regulation – either by the federal state or local governments.
The “unbundling” of generation however, created a new dynamic where utilities are no longer the sole producers of electricity and pricing is no longer determined by government regulators. In this new, unbundled and restructured energy industry price is now determined by the free market principles of supply and demand.
These markets created competition – giving customers, both residential and commercial, the ability to choose a lower cost energy supplier and manage their energy costs.