Right of rescission in energy contracts
Short answer. Rescission is a short cancellation right after you agree to a supplier contract, often three business days for residential door-to-door or in-home sales. It is not the same as an early termination fee, which applies after the contract is in force. The clock, the method of notice, and whether your channel (online, phone, door) qualifies are written in state rules and in the contract.
What to do inside the window
If you signed at the door or under pressure, use the rescission instructions in the packet the same day. Written notice is safer than a phone call you cannot document. Keep a copy. Tell the utility if a switch has already been requested so the pending enrollment is dropped. Do not wait for the first bill. The window is measured from the agreement, not from the first charge.
When the right is easy to miss
Online enrollments may have a different cancellation rule than door-to-door sales. A business account often has no residential cooling-off right. A renewal you let auto-continue is not a new door-to-door sale. If the window has closed, you are in early-termination territory, not rescission territory.
Rescission versus slamming
Rescission is you undoing your own enrollment. Slamming is an enrollment you never agreed to. Both should be reported, but slamming is a complaint about unauthorized switching, and you should not be held to that contract while the utility investigates.
Questions people ask
How many days do I have to cancel?
Many states use three business days for in-person residential sales. Do not rely on that number until you read your contract and your state commission’s rule. The notice method matters.
Does rescission cost money?
A valid rescission should not trigger an early termination fee, because the contract never fully started. Get the cancellation confirmation.
Can a business rescind a supply contract?
Usually the residential cooling-off rule does not apply. Business cancellations follow the contract you signed.
Use the bill, not a stale screenshot
Right of rescission in energy contracts comes down to documents you can keep: the utility name on the bill, the supply price or default price, the kWh or demand that drove the charges, and the term and fees in any contract. National average prices from the Energy Information Administration are context. For 2024, EIA put average residential use at 865 kWh a month and the average residential price at 16.5 cents per kWh. For June 2026, EIA reported 18.34 cents per kWh of residential revenue. Those figures mix supply and delivery for the whole country. They are not a price to compare, and they are not an offer in this territory.
If a salesperson’s number and the bill disagree, keep the bill. Shop Energy Prices does not rank suppliers and does not publish a live rate table. Re-check the official shopping site or the utility tariff on the day you enroll, because offers and default prices change.
Going further on Right of rescission in energy contracts
Right of rescission in energy contracts is a contract or bill-literacy question. The document that controls is the one you can download for your account, not a summary on a comparison site.
Supply is the part a choice customer can shop. Delivery is the utility’s wires, metering, and outage response. Fees, credits, and the end-of-term rule decide whether a low cents figure is actually low at your usage.
A fixed price holds the contracted supply rate for the term. A variable price follows the supplier’s posted rule. An early termination fee is the cost of leaving a fixed term early. Rescission is a short window at the start, where state rules give you one. They are not the same right.
Switches take effect on a meter read, not the hour you click. Until the utility confirms the date, the old arrangement remains. Keep paying undisputed delivery charges. Two supply charges for the same dates are a billing dispute with the utility.
An illustration, not an offer: 1450 kilowatt-hours times a 1 cent gap is 15 dollars before any monthly fee. If the fee is larger, the gap is not a reason to switch.
When the term ends, many contracts roll to a price you did not re-shop. Put a reminder 30 to 60 days ahead. Default service is a legitimate choice if the new offers are worse.
What to verify before you act
Write down the utility name, the account name, the supply price or default price, and a typical month of use. Right of rescission in energy contracts does not change those four facts. If a contractor, a supplier, or a city page disagrees with the bill, the bill wins. Shop Energy Prices does not sell electricity and does not keep a live rate table.
Use one official source for the benchmark: the price to compare or default service on the bill, the state shopping site if your state publishes one, or the commission docket that sets the default. EIA’s national averages are context for scale. They are the wrong number to beat.
Keep the contract PDF. Circle the term, the fee to leave, the renewal rule, and any pass-through that is not fixed. A verbal match to a competitor is not the product. If you are inside a cancellation window, follow the written notice method the same day and keep a copy.
Re-read the contract or tariff section that mentions Right of rescission in energy contracts and copy the defined term into your notes. If the defined term does not match the way a salesperson used the words, the defined term controls. Ask the supplier or the utility, in writing, which line on the next bill will change and which lines will not.
Re-read the contract or tariff section that mentions Right of rescission in energy contracts and copy the defined term into your notes. If the defined term does not match the way a salesperson used the words, the defined term controls. Ask the supplier or the utility, in writing, which line on the next bill will change and which lines will not.
Re-read the contract or tariff section that mentions Right of rescission in energy contracts and copy the defined term into your notes. If the defined term does not match the way a salesperson used the words, the defined term controls. Ask the supplier or the utility, in writing, which line on the next bill will change and which lines will not.
A worksheet for Right of rescission in energy contracts
Write the utility, the rate class, the current supply or default price, the end date, and a recent month of kilowatt-hours. Beside them write the alternative and every fee. Right of rescission in energy contracts is finished only when those two columns can be subtracted. If you cannot name the fee to leave, you do not yet have a decision.
Ask, in writing, which bill lines change and which stay. Delivery, franchise fees, and gross-receipts taxes usually stay. Supply, a voluntary green attribute, or an equipment runtime can change. A seller who will not point at the line is not ready for your signature.
Set one reminder for 60 days before the contract ends and one for the day a commission usually resets default service, if you know that month. Right of rescission in energy contracts does not require weekly shopping. It requires one careful comparison at the moment the price can actually change.