17 Deregulated Energy States in 2025 Complete List and Comparison

What Makes a State Deregulated

Electricity deregulation separates generation (supply) from distribution (delivery). How it works in deregulated states:

⚡ Consumers choose their electricity supplier
⚡ Local utility continues delivering power through existing infrastructure
⚡ Competitive market structure emerged from state legislation beginning in the 1990s

Three types of market structures:

Fully deregulated: Multiple suppliers compete for residential customers
Regulated: Traditional utility monopolies handle both generation and distribution
Partially deregulated: Only commercial customers or specific territories have choice

💡 Key insight: The degree of competition and consumer choice varies significantly among deregulated states based on market rules and participation levels.

Fully Deregulated States in 2025

17 states plus the District of Columbia have fully deregulated residential electricity markets as of 2025. Most competitive markets:

🏆 Texas: 100+ retail providers, no default utility service
🏆 Ohio: Robust competition via PUCO-certified suppliers and Apples to Apples
🏆 Pennsylvania: Extensive choice via PA Power Switch with dozens of suppliers
🏆 Massachusetts: Residential choice (market concentration limits active suppliers)

✅ ElectricRates.org currently serves Ohio, Pennsylvania, and Massachusetts customers. Northeast deregulated states:

🗺️ Connecticut, Delaware, Maine, Maryland
🗺️ New Hampshire, New Jersey, New York, Rhode Island

Midwest deregulated states:

🗺️ Illinois (active competition in Ameren and ComEd territories)

📊 These states represent approximately 60 million households with electricity supplier options.

States with Partial Deregulation

Several states have deregulated electricity markets with significant limitations. States with limited residential choice:

🔸 California: Suspended residential choice after 2000-2001 energy crisis (commercial customers retain options)
🔸 Virginia: Limited choice in Dominion Energy territory — participation remains low
🔸 Michigan: Caps competitive supply at 10% of utility load

States that reversed deregulation:

⏪ Montana: Limited ongoing competition
⏪ Nevada: Limited ongoing competition

Commercial-only choice states:

🏢 Georgia: Large commercial customers only
🏢 Florida: Large commercial customers only
🏢 Oregon: Limited competition — most residential customers remain with traditional utilities

⚠️ Key takeaway: Market structures vary significantly — consumer options may be limited compared to fully competitive states.

Northeast Deregulated Markets

The Northeast has the highest concentration of deregulated electricity markets, largely served by ISO New England and PJM Interconnection wholesale markets. Massachusetts:

⚡ Residential choice through MA DPU-licensed competitive suppliers
⚡ Primary distribution utilities: Eversource and National Grid

Other Northeast deregulated states:

🗺️ Connecticut: Eversource and United Illuminating customers can choose suppliers
🗺️ Rhode Island: National Grid customers have supplier choice
🗺️ New Hampshire: Shop through NH PUC process
🗺️ Maine: Active competition via Central Maine Power and Versant Power
🗺️ New York: Extensive choice via NYSERDA Energy Marketplace
🗺️ New Jersey: Competition via NJ Board of Public Utilities oversight

💡 Advantage: These markets benefit from shared wholesale infrastructure and regulatory coordination.

Midwest Deregulated Markets

The Midwest features several significant deregulated electricity markets. Ohio — Among the most competitive:

⚡ 100+ certified retail suppliers
⚡ Serves AEP Ohio, Duke Energy, FirstEnergy, and AES Ohio territories

Illinois — Robust competition:

⚡ ComEd and Ameren service areas
⚡ Numerous active suppliers
⚡ Municipal aggregation programs

Michigan — Limited competition:

⚠️ Capped at 10% of utility load
⚠️ DTE Energy and Consumers Energy as primary utilities

Fully regulated Midwest states:

🔒 Indiana: Traditional utility monopolies
🔒 Wisconsin: Traditional utility monopolies
🔒 Missouri: Explored deregulation but maintained regulated markets

💡 Models for effective Midwest deregulation: Ohio and Illinois — strong consumer protections and active supplier markets.

Texas - America Most Competitive Market

Texas operates the most deregulated electricity market in the United States with unique characteristics. Key features of Texas deregulation:

🏆 ERCOT manages ~90% of state grid independently from other U.S. interconnections
🏆 No default utility service — all customers must actively choose a provider
🏆 100+ retail electricity providers compete for customers

Plan options available:

📋 Fixed rates
📋 Variable rates
📋 Indexed plans
📋 Renewable energy plans

Regulatory oversight:

📊 Public Utility Commission of Texas
📊 Power to Choose comparison website

Limitations:

⚠️ Municipal utilities excluded
⚠️ Electric cooperatives in some areas excluded

⚠️ Note: The competitive market produces rate variations and promotional offers not seen in other states — but also created the February 2021 winter storm crisis exposing market design vulnerabilities.

Regulated vs Deregulated State Comparison

Comparing outcomes between regulated and deregulated states reveals mixed results. ✅ Advantages of deregulated markets:

📋 More consumer choice
📋 Promotional rates available
📋 Renewable energy options unavailable in regulated markets

❌ Potential drawbacks:

📊 Average residential rates sometimes exceed regulated state averages
📊 Reflects regional factors: fuel mix, grid infrastructure costs
📊 Comparison shopping can be confusing

Customer satisfaction findings:

👍 Deregulated state residents appreciate choice
😕 Sometimes find comparison shopping confusing

Regulated state trade-offs:

✅ Simplicity with single-provider relationships
❌ No competitive alternatives when utility rates increase

💡 Key insight: Deregulation benefits engaged consumers who actively shop while passive customers may pay more than necessary. Market design, consumer education, and regulatory oversight significantly impact outcomes.

Future of Electricity Deregulation

Electricity market structures continue evolving in response to changing technologies and consumer preferences. Current trends:

📊 No new states have fully deregulated residential markets since the early 2000s
📊 Expansion phase appears concluded

Emerging forms of competition in regulated states:

🌱 Limited competition for renewable energy
🌱 Community solar programs
🌱 Distributed energy resources (rooftop solar, battery storage)

Federal policy landscape:

🏛️ Occasional national deregulation proposals discussed
🏛️ States retain primary jurisdiction over retail markets

Market refinements in existing deregulated states:

🔧 Renewable energy requirements
🔧 Enhanced consumer protections
🔧 Market power concentration rules

💡 Looking ahead: Climate goals may drive market restructuring as states seek to accelerate clean energy deployment.

Frequently Asked Questions

How many states have deregulated electricity markets?

As of 2025, 17 states plus the District of Columbia have fully or substantially deregulated residential electricity markets. These include Texas, Ohio, Pennsylvania, Massachusetts, Connecticut, Delaware, Illinois, Maine, Maryland, Michigan (limited), New Hampshire, New Jersey, New York, Rhode Island, and parts of Virginia. Several additional states have commercial-only or partial deregulation.

Why did some states reverse electricity deregulation?

California suspended residential choice after the 2000-2001 energy crisis that caused rolling blackouts and utility bankruptcies. Montana and Nevada also reversed course after deregulation failed to deliver promised savings. Market design flaws, inadequate consumer protections, and wholesale price volatility contributed to these reversals. Most states that fully implemented deregulation have maintained competitive markets.

Do deregulated states have lower electricity rates?

Research shows mixed results. Deregulated states do not consistently have lower rates than regulated states when comparing regional averages. However, consumers who actively shop for competitive rates in deregulated markets often find savings compared to utility default rates. Many factors beyond market structure affect rates including fuel costs, grid infrastructure, and state policies.

Can I choose my electricity supplier if I live in a regulated state?

In fully regulated states, residential customers cannot choose alternative electricity suppliers. Your local utility provides both generation and delivery as a bundled service at rates set by state regulators. Some regulated states allow limited renewable energy choices or community solar participation that provides indirect supplier selection.

Which deregulated state has the most competitive electricity market?

Texas has the most competitive residential electricity market with over 100 retail providers and no default utility service. All Texas customers in ERCOT territory must actively choose a provider. Ohio and Illinois also have highly competitive markets with numerous suppliers and active municipal aggregation programs providing strong consumer options.

Will more states deregulate electricity in the future?

No new states have fully deregulated residential electricity markets since the early 2000s, and this trend appears unlikely to change significantly. States are instead exploring limited competition for renewable energy, community solar, and distributed resources. Existing deregulated states continue refining market rules rather than expanding the model to new jurisdictions.

Which deregulated states does ElectricRates.org serve?

ElectricRates.org currently serves residential customers in Ohio, Pennsylvania, and Massachusetts. The service compares rates from all licensed suppliers in these three states, helping customers find savings averaging $521* per year. Enter your ZIP code at ElectricRates.org to see available rates in your area within 2 minutes.

About the author

Han Hwang

Consumer Advocate

Han joined ComparePower with years of experience building and scaling digital marketplaces. He brings that expertise to ElectricRates.org, focused on making energy shopping simpler for consumers in Ohio, Pennsylvania, and Massachusetts.

Electricity marketplace operationsDigital business strategyRetail electricity marketsConsumer experience optimizationPartnership development

Topics covered

deregulated states electricity deregulation energy choice competitive electricity markets state energy policy

Sources & References

EIA - State Electricity Profiles (U.S. Energy Information Administration): "EIA tracks state electricity market structures including deregulated retail markets"Accessed Jan 2025
FERC - Electric Markets (Federal Energy Regulatory Commission): "FERC provides regulatory framework for wholesale electricity markets in restructured states"Accessed Jan 2025

Last updated: December 10, 2025