An early termination fee (ETF) is a charge that is levied by an electricity provider if you cancel your contract before the end of the agreed-upon term. ETFs are common in the electricity industry and are typically designed to compensate the provider for the costs associated with setting up your service, such as installing a meter or running new power lines to your home.
There are a few ways you can avoid an ETF when canceling your electricity plan:
- Wait until your contract is up: The most straightforward way to avoid an ETF is to simply wait until your contract term has expired before canceling your service.
- Negotiate with your provider: If you need to cancel your contract before the end of the term, you may be able to negotiate with your provider to waive or reduce the ETF. It never hurts to ask, and you may be able to come to an agreement that works for both of you.
- Switch to a new provider: If your provider is unwilling to waive or reduce the ETF, you may be able to avoid the fee by switching to a new provider. Just be sure to carefully read and understand the terms of any new contract you sign to ensure you won't be subject to any ETFs or other fees down the road.
- Check if you qualify for a hardship exemption: Some states have hardship exemptions that allow customers facing financial difficulties to cancel their contracts without incurring an ETF. You may be able to qualify for an exemption if you are experiencing a temporary or permanent financial hardship, such as a job loss, a reduction in income, or a medical emergency.