Your electric service has two components: supply and delivery. You are charged separately for your electricity supply and for the delivery of your electricity.
Supply refers to the generation of electricity. Coal, natural gas and oil are the principal fossil fuels used to generate electricity.
With the advent of electricity deregulation, customers can choose to buy electricity from competing suppliers. Or, if they do not choose an alternative supplier, their utility buys power for them and passes along the cost. This is called Standard Offer Service.
The other part of getting electricity to you is delivery. On your customer bill, this is called distribution. Distribution rates cover the costs of maintaining, expanding and improving our electric system – the power poles, lines, meters, linesmen and customer service representatives who serve you.