Early termination fees and how to leave an energy supplier

Maybe your bill went up. Maybe you just want out. Either way, the first worry is often the same: "Will they charge me to leave?"

The answer depends on where you live and what your contract says. Let me walk you through it, state by state.

What is an early termination fee?

An early termination fee is a charge for ending a contract before its end date. Some people call it a cancellation fee or an exit fee.

It comes from the supplier. That is the company that sets the price for the electricity or gas you use. It never comes from your utility, the company that owns the wires or pipes and fixes outages. Your utility does not charge you to come back to its standard price.

The fee, if there is one, is written in your contract. So the best first step is always the same: find your contract, or call the supplier and ask, "Is there a fee if I leave now? How much?"

Can my supplier charge me to leave in Ohio?

Yes, it can, if your contract says so. Ohio lets suppliers set their own fees. The Ohio Consumers' Counsel says in its Standard Offer fact sheet (opens a new tab) that the fee "can be $100 or more."

But there are times when Ohio rules say no fee is allowed:

• At the end of your contract. There is no fee to go back to your utility's standard price when your contract ends.
• If you move. For electric plans, an Ohio rule says you can end the contract without a penalty if you move out of the supplier's service area, or to a place where the supplier charges a different price. (Ohio rule 4901:1-21-12 (opens a new tab))
• Some variable plans. A variable price can change from month to month. If a supplier's contract only lists the things that make the price move, and gives no exact formula, that same rule says it may not charge an early termination fee.
• If the supplier breaks the deal. If you are sent back to the standard price because the supplier went out of business, walked away, lost its license, or switched you without your OK (called slamming), you owe no costs or penalties for going back. (Ohio rule 4901:1-10-29 (opens a new tab))

In Ohio, the utility's standard price for electricity is called the Standard Offer. For gas, most companies call it the Standard Choice Offer. The Ohio Consumers' Counsel says to call your utility to switch back to the standard price, and to call the supplier to ask about any fee.

Can my supplier charge me to leave in Pennsylvania?

Yes, if your contract has a fee. But Pennsylvania rules make the supplier spell it out. Fees "must be disclosed in actual dollars or a specific method for determining the actual dollars." (52 Pa. Code § 54.5 (opens a new tab))

There is also a free window near the end. Before a fixed-length contract ends, the supplier has to mail you two letters:

1. An initial notice, 45 to 60 days before the end.
2. An options notice, at least 30 days before the end.

Once the options notice goes out, you can leave with no fee, any time up to the end date. (52 Pa. Code § 54.10 (opens a new tab)) The state's shopping site, PA Power Switch (opens a new tab), puts it simply: early cancellation fees do not apply in the last 30 days of your contract.

These rules are for electric plans. For gas in Pennsylvania, see the state's gas shopping site, pagasswitch.com (opens a new tab).

Can my supplier charge me to leave in Illinois?

No, not for a home. This is the good news in Illinois.

• Electric: since January 1, 2020, home customers "have a right to terminate their contracts" with suppliers "at any time without any termination fees or penalties." (220 ILCS 5/16-119 (opens a new tab)) The state's Plug In Illinois (opens a new tab) site says the same for town programs.
• Gas: the same is true. Since January 1, 2020, home customers can end a gas supplier contract at any time with no termination fee or penalty. (220 ILCS 5/19-115 (opens a new tab); the Illinois Commerce Commission's gas choice page (opens a new tab) agrees.)

You still pay for the energy you already used. You just don't pay extra to leave.

One catch for electric: when you go back to ComEd or Ameren Illinois, the utility won't charge a fee, but "you may have to stay with the electric utility for at least 12 months." (Plug In Illinois (opens a new tab)) If you think you might want a new supplier soon, ask your utility about this before you switch back.

What about the first few days after I sign?

Every state gives you a short time to change your mind for free. This is called a cancel window.

• Ohio electric: 7 days from the postmark on your utility's letter. Call your utility.
• Ohio gas: 7 business days from the postmark on your gas company's letter. Call or write to your gas company.
• Pennsylvania: 3 business days after you get the supplier's written terms (the disclosure statement). You can cancel in writing, by phone or online.
• Illinois electric: 10 days after your utility processes the switch. Your utility mails you a letter about it.
• Illinois gas: 10 business days after the date on your gas company's letter. Call the gas company or the supplier.

If you are still inside that window, you don't need to worry about a fee at all.

How do I go back to my utility, step by step?

Here is what I would do:

1. Find your contract. Look for the words "early termination," "cancellation fee" or "exit fee." Note the end date too.
2. Call the supplier if you are unsure. Ask: "If I leave today, is there a fee? How much?" Write down the answer, the date and the name of the person you spoke with.
3. Call your utility. Use the number on your bill. Say, "I'd like to go back to your standard price." In Pennsylvania, ask to "return to default service."
4. Write down any confirmation number.
5. Watch your next two bills. The switch can take a billing cycle. Make sure the supplier's name drops off.

That's it. Your lights and heat stay on the whole time. Switching back only changes who sets the price. (If that worries you, I explain it in Is it safe to switch my electric supplier?)

Is it ever worth paying the fee?

Sometimes, yes. A fee is a one-time cost. A high price keeps costing you every month.

Here is a simple way to think about it:

• Say your fee is $100.
• Say leaving would save you $25 a month.
• Then you would earn back the fee in 4 months.

If your contract has a year left, paying the fee could still save you money. If your contract ends next month, it's usually better to wait. And if you are close to the end in Pennsylvania, the fee may already be gone.

The hard part is knowing how much you would save each month. That depends on your usage and on today's standard price, which changes during the year. For live prices, see your state page: Ohio, Pennsylvania or Illinois.

If your price jumped suddenly, read why a variable rate can make your bill jump. If your contract ends soon, see what to do when your supplier contract is ending. For Illinois gas, see my guide to gas suppliers with Nicor and Peoples Gas.

Who to call with questions

• Ohio: the Public Utilities Commission of Ohio (PUCO) at 1-800-686-7826, or the Ohio Consumers' Counsel at 1-877-742-5622.
• Pennsylvania: the PA PUC at 1-800-692-7380, or the Office of Consumer Advocate at 1-800-684-6560.
• Illinois: the Illinois Commerce Commission at 1-800-524-0795, or the Citizens Utility Board at 1-800-669-5556.

Before you pay any fee, get the number in writing or write it down during the call. A fee you were never told about is worth a complaint.

What to do next

1. Find your contract and look for the fee and the end date.
2. Run the free bill check. I compare your price with your utility's standard price and the offers in your area, and I include any fee to leave when I do the math.
3. See today's prices on your state page: Ohio, Pennsylvania or Illinois.
4. For more plain answers about fees and changing your mind, visit the Help page.