How Electricity Deregulation Works in Rhode Island
Rhode Island opened its electricity market to competition under the 1996 Utility Restructuring Act. Rhode Island Energy still delivers power to nearly the whole state either way, and you can choose a competitive supplier instead of the utility's default Last Resort Service — but state analysis has found that most residential customers who did ended up paying more, not less.
Delivery stays the same either way
Rhode Island Energy delivers electricity to about 99% of the state — roughly 486,000 customers across more than 6,000 miles of distribution lines. Two smaller utilities, Block Island Power Company and Pascoag Utility District, serve the remaining pockets and generally sit outside the competitive supply market. Restructuring "unbundled" energy supply from distribution: whichever supplier you choose, Rhode Island Energy still owns the wires, reads the meter, and responds to outages.
Last Resort Service: the default rate
If you don't choose a competitive supplier, you're automatically on Last Resort Service (sometimes called standard offer service) — Rhode Island Energy's own regulated default supply rate. It exists specifically so every customer has guaranteed access to power regardless of whether they've ever shopped for a supplier, and it's the baseline any competitive offer should be measured against.
What the state's own data shows about switching
This is the part worth reading carefully before signing up with a third-party supplier. An analysis of Rhode Island billing data found that third-party electric suppliers overcharged residential customers by an estimated $61.6 million between 2017 and 2024. In 2024 alone, the average third-party supply rate was about $0.172 per kWh, compared to $0.131 for Last Resort Service and $0.116 for municipal aggregation programs — meaning the state's own default rate and local aggregation programs outperformed most competitive offers, not the other way around. The pattern identified: suppliers frequently use low introductory "teaser" rates that increase sharply after the first billing cycle or two, and nearly all of the larger suppliers studied raised customer bills over the study period rather than lowering them.
Municipal aggregation, where available
Some Rhode Island communities run municipal aggregation programs that negotiate a supply rate on behalf of residents who haven't separately chosen a supplier — and in the state's own data, these programs beat both Last Resort Service and most third-party suppliers on price. If your city or town participates, check a recent bill's supplier line; you may already be on an aggregated rate.
If you're still considering a competitive offer
The state provides the Empower RI comparison tool specifically so residents can check a competitive offer's real price against Last Resort Service before signing anything. Given the state's own findings, the safest approach is to treat any offer with real skepticism — especially a low introductory rate — and confirm in writing how long that rate holds and what it becomes afterward, rather than assuming a "discount" claim is accurate.
Frequently asked questions
Who delivers electricity in Rhode Island?
Rhode Island Energy delivers power to about 99% of the state. Two smaller utilities, Block Island Power Company and Pascoag Utility District, serve the remaining areas and generally aren't part of the competitive supply market.
What is Last Resort Service in Rhode Island?
Last Resort Service (also called standard offer service) is Rhode Island Energy's default electricity supply rate for customers who haven't chosen a competitive supplier. It's set through a regulated process rather than negotiated individually.
Does switching to a competitive supplier in Rhode Island save money?
State-level analysis has found the opposite for many residential customers: third-party suppliers were found to have charged Rhode Island residents an estimated $61.6 million more than Last Resort Service or municipal aggregation rates between 2017 and 2024, largely due to low introductory "teaser" rates that later increase.
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