How to Compare Commercial Energy Proposals in Illinois

Comparing commercial energy proposals is where good procurement is won or lost. The mistake is comparing headline rates; the discipline is normalizing every proposal onto the same basis and reading the terms behind the number.

Match before you compare

Proposals are only comparable when the key variables are the same:

• Delivery start date and term — a July start and an October start price differently; a 12-month and a 36-month term aren't the same product.
• Included components — energy, PJM/MISO capacity, transmission, line losses, renewable obligations, ancillary services, and supplier fees. Confirm which are in the rate and which are passed through separately.
• Volume tolerance (bandwidth/swing) — the allowed variance around expected usage, and the cost when you fall outside it.
• Credit terms — deposits or credit conditions that change the effective deal.

If these differ across proposals, normalize them first. Our apples-to-apples worksheet walks through the mechanics.

Why matched terms decide the outcome

The reason matching comes first is that a commercial supply price is not a single fact about the market — it is the answer to a specific question. Ask two suppliers to price a 12-month term starting in one month for a fully-loaded, all-in product with a wide usage band, and their answers are genuinely comparable. Ask one for that and the other for a 24-month term starting three months later with capacity passed through separately and a narrow band, and the two numbers describe different products entirely. The lower one is not "cheaper" — it is answering an easier question. Normalizing the request is what makes the answers mean the same thing.

Confirm what each rate includes

A commercial electricity price is built from several wholesale components: energy, PJM or MISO capacity, transmission, line losses, ancillary services, and any renewable-portfolio obligation, plus the supplier's own fees and margin. A proposal can present all of these bundled into one fixed cents-per-kWh number, or it can quote a lower "energy-only" number and pass some components through as separate line items that move with the market.

Neither structure is wrong, but they are not comparable at the headline. A fully-loaded fixed price carries more of the risk on the supplier's side; a partially-passed-through price leaves more risk with you and typically shows a lower headline as a result. Before comparing, write down for each proposal which of these components is inside the rate and which is passed through separately. When the included scope differs, either ask each supplier to re-quote on a common scope or add the expected pass-throughs back in so the comparison happens on the same all-in basis.

Read the terms, not just the rate

A low headline rate can hide broad exclusions, tight tolerances, or an aggressive renewal clause. Before choosing, review the contract terms — pricing scope, change-in-law, termination, and renewal/holdover language. The contract expiration risks guide covers the renewal traps specifically.

A few terms deserve particular attention because they can quietly reverse a comparison:

• Change-in-law and regulatory pass-through. Language that lets a supplier pass new taxes, fees, or market-rule changes through to you shifts risk back onto the account. A "fixed" price with a broad change-in-law clause is less fixed than it looks.
• Termination and early-exit provisions. What happens if you sell the property, close the site, or want out early? Some contracts settle at a market difference, others charge a formula-based fee. This is easy to ignore at signing and expensive to discover later.
• Renewal and holdover mechanics. Whether the contract auto-renews, rolls to a variable holdover rate, or simply expires — and the notice window to prevent an unwanted renewal — belongs in the comparison, not in a later surprise.
• Materiality and reconciliation clauses. Terms allowing the supplier to reconcile or true-up for usage or capacity-tag changes determine who absorbs the cost when reality differs from the forecast.

A short worked walkthrough

Picture two proposals that arrive at the same headline cents-per-kWh. Read past the number and the differences emerge. The first bundles capacity and transmission into the rate and allows a wide usage band; the second quotes energy-only, passes capacity through at market, and holds you to a narrow band. On paper they tie. In practice, the second proposal's real cost depends on where capacity settles and on how steady the load is — variables the headline never showed. The account with a swinging load and a high capacity tag could easily pay more under the "matching" rate. The point of the walkthrough is not a number; it is that the comparison only becomes honest once the structure behind each rate is on the table.

Benchmark against the utility

Every proposal should also be measured against the applicable utility default supply — the price to compare — not a national average, so you know whether shopping actually beats staying put for that account. Remember that the utility default is a supply comparison only: the delivery portion of the bill stays with ComEd or Ameren regardless of who supplies the electricity, so the proposal and the default should be compared on the supply line, not the whole bill.

Common mistakes when comparing

• Comparing offers taken on different days. Prices move; an old quote and a fresh one are not the same basis. Collect competing offers in the same window.
• Reading only the rate and skipping the term sheet. The rate is the visible number; the terms decide the real cost.
• Ignoring the load's shape and size. A rate that suits a flat, predictable load can be the wrong fit for a swinging or seasonal one. Bandwidth and capacity treatment matter more as the load gets lumpier.
• Applying a supply-rate difference to the entire bill. Only the supply portion changes when you switch suppliers; delivery, riders, and taxes do not.
• Assuming choice applies. Municipal-electric communities such as Naperville and Springfield have no supplier choice, so confirm eligibility for the specific account before comparing at all.

A simple comparison checklist

1. Same start date and term across all proposals.
2. Same included components (or explicitly noted differences).
3. Tolerance and out-of-band cost understood.
4. Renewal, termination, and change-in-law terms read.
5. Benchmarked against utility default supply.

Follow the full sequence in how commercial energy procurement works.

Sources

• Illinois Commerce Commission — Electric Choice Basics
• Illinois Power Agency — Electricity Supply Rates

No comparison method guarantees savings; it ensures the decision is made on comparable, fully-loaded terms.