Delaware business electricity: SOS and 300 kW

One utility, one choice programme

Delaware opened the supply portion of electric service to competition in 1999, and the Commission's customer page still describes the programme in the singular: the option is currently available to Delmarva Power customers for electric only. That sentence does more work than it looks like it does. A business served by a municipal electric system or by the Delaware Electric Cooperative is not a Delmarva account, so the state's supplier framework does not reach it, and a business that wants to compare offers has to establish who serves the address before it establishes anything else. For a Delmarva account the split is clean: a certified supplier sells the supply, Delmarva delivers it and still sends the bill, and the delivery charge is the utility's. The Commission publishes a list of certified suppliers covering residential, commercial and industrial customers and urges buyers to contact each one, because certification is a fitness test rather than an offer of service. The Commission also publishes a monthly enrolment report showing the number and classification of customers who have switched, which is the closest thing Delaware offers to a measure of how deep the market actually is: a programme can be open to every commercial account in the state and still have few of them in it.

• Supply is roughly 65 percent of a Delmarva customer's total bill on the Commission's own annual figure, which is the share a supplier competes for.
• A dispute about the supply contract or the amount owed to the supplier goes to the supplier, not to the utility that prints the bill.
• Chapter 10 of Title 26 defines the roles separately: an electric supplier is certified by the Commission, a broker acts as intermediary without taking title, and a marketer takes title.

Standard Offer Service is a procurement, not a standing tariff

The default commodity in Delaware is bought. The Commission adopted the procurement procedure in Order No. 6746 on 11 October 2005, for service beginning after 1 May 2006, and then revisited the request-for-proposal process once the first rounds had cleared, in light of the Electric Utility Retail Customer Supply Act of 2006 and complaints about transparency. Order No. 7053 in October 2006 approved consensus changes, and further consensus orders followed in 2007, 2008 and 2010. Before each procurement the Commission engages an independent technical consultant to watch Delmarva run the process and report on it; the report covering the 2025-2026 request for proposals was filed in February 2026. The practical consequence for a buyer is that the alternative to a supplier contract is a series of competitively procured contracts with defined terms, not an administratively set number that moves when the Commission feels like moving it.

• Rider SOS defines four fixed-price customer groups: the residential and small non-demand group, MGS-S, LGS-S, and GS-P.
• A Procurement Cost Adjustment has been calculated annually since 1 June 2007 to reconcile the actual cost of serving each fixed-price group against what was billed, with interest, so the default carries a true-up rather than a single locked price.
• Rider HPS provides hourly priced supply for eligible customers, which is the other way to be in the market without choosing a supplier.

The 300 kW summer line divides the commercial classes

Delmarva's Delaware tariff is organised around the summer peak rather than an annual one. Service Classification SGS-ND is the small non-demand class. MGS-S, medium general service at secondary voltage, is available to a customer with monthly usage above 3,500 kWh for two consecutive months and a summer maximum measured demand below 300 kW. LGS-S, large general service at secondary voltage, takes any customer with a summer maximum measured demand of 300 kW or greater, and holds it for at least twelve billing months even if the following summers come in lower; only after twelve billing months without a summer reading at or above 300 kW does the account move back to MGS-S. GS-P serves primary-voltage customers who own and maintain the transforming, switching and protection equipment, and it also takes transmission-voltage customers whose PJM peak load contribution is below 400 kW, which is the one place in this tariff where a market allocation decides a retail schedule. The tariff also refuses to inherit a classification. Section V.C requires the company to ask a new customer what business will be transacted at a previously occupied premises and to help it choose the most financially beneficial schedule, and it states expressly that the company shall not place a new customer on MGS-S or LGS-S simply because the previous occupant received service there. A tenant that takes over a restaurant or a machine shop should therefore check the classification on its first bill rather than assume it followed the building.

• The test is a summer maximum, so a January peak does not move an account up a class and a single June afternoon can.
• The twelve-month stay runs on billing months, not calendar years, so the anniversary shifts with the meter-read cycle.
• Both LGS-S and GS-P normally get a demand-recording meter at 300 kW, and the tariff states that the device does not normally include a remote communications link.

Winter demand is three-quarters last summer

This is the clause that makes a Delaware bill look wrong to a business that moved in from another state. Under Paragraph I of LGS-S, the billing demand for the summer months of June through September is the measured demand for that month. For each of the following winter months, October through May, the billing demand is 25 percent of that month's own measured demand plus 75 percent of the average of the billing demands for the most recent summer months of June through September. A customer that first takes service during the winter gets the same structure with an estimated summer average, for that initial winter only. The arithmetic has two consequences worth stating plainly: a site that peaks in July pays for that peak through the following May, and a winter month in which the building runs harder than it did in summer recovers only a quarter of the increase. Efficiency work that lands in October does not show up in the demand line until the following summer resets the base.

• A summer average is computed from four monthly billing demands, so one bad August moves a quarter of the average rather than the whole of it.
• The winter month's own demand still counts, at a quarter weight, which means a heating-driven winter peak is not free.
• MGS-S does not use this formula: its billing demand is the maximum measured demand created during the month, so the two classes behave differently across a year.

What the supply rider does to a shopper's bill

Rider SOS is available in the Delaware portion of the service area to customers who do not have an electricity supplier for supply and transmission, and it names its own transmission method. Capacity is allocated on the Capacity Peak Load Contribution, defined in the tariff as the customer's contribution to the PJM system peak, and transmission on the Transmission Peak Load Contribution, defined as the contribution to the Delmarva zone peak. Those are two different measurements of the same building, and both are set by PJM's methods rather than by the utility's reading of a monthly maximum. The bill also carries a Renewable Portfolio Standard charge as its own per-kilowatt-hour line, most recently filed under Order No. 10804 in Docket No. 25-0317, which a supplier does not remove. Power factor is measured against a 90 percent lagging base whenever measured demand reaches 300 kW in the current or any of the previous eleven months, and the tariff applies a charge or a credit per kilowatt for each whole percentage point away from that base. A small non-demand or MGS-S account on Standard Offer Service with an advanced meter may also qualify for Rider DP, the peak energy savings credit, which pays a credit for reducing use during called events; the rider excludes customers already taking hourly priced supply, so the two options are alternatives rather than additions.

• The power-factor band runs in both directions, so a building corrected above 90 percent earns a credit on measured demand rather than simply avoiding a penalty.
• The RPS charge is a supply-side line item, which is why a competitive contract has to be compared against a default that includes it.
• A supplier that bundles transmission is taking on the peak-load-contribution exposure, and the contract should say which contribution it is pricing.

Gas is distribution only

Delaware's gas side does not mirror its electric side. The Commission regulates the distribution of natural gas and names two regulated distributors, Chesapeake Utilities Corporation and Delmarva Power; base delivery costs are set in base-rate proceedings and the cost of the gas itself is recovered through an annual fuel adjustment, with rates typically changing at least once a year and mid-year adjustments where over- or under-collection passes the tariff's limits. Its gas pages describe rate regulation, tariffs and an environmental rider for manufactured-gas site cleanup. They do not describe a supplier-choice programme of the kind the electric side runs, so a commercial buyer should assume the gas commodity comes with the utility tariff until a specific tariff provision says otherwise. Propane is outside Commission rate regulation altogether, though the Commission administers the pipeline safety programme that covers both fuels' distribution systems.

• Ask which distributor serves the address, because Chesapeake and Delmarva file separate Delaware tariffs.
• A gas budget is exposed to the annual fuel adjustment even where the delivery charge is fixed for the year.

What to bring to a Delaware review

The work starts with the account rather than the market. Pull twelve months of bills for each site and read the service classification off the first page; confirm whether the summer maximum cleared 300 kW, because that single number decides between MGS-S and LGS-S and therefore whether the winter formula applies at all. Collect the Capacity and Transmission Peak Load Contributions if the utility will release them, since those are what a supplier prices. Note the power factor on the demand months, and check whether any site sits behind a municipal system or the cooperative, which removes it from the supplier programme entirely. Then compare the offer against Rider SOS, not against a headline rate: the default includes the RPS charge, the delivery charge and a true-up, and an offer that beats a number which excludes those is not a comparison.

• Twelve bills per site, with the service classification and the demand readings legible.
• The summer maximum for the last two summers, which is the class test and the winter formula's base.
• Confirmation from the Commission's certified-supplier list that the supplier on the table is certified and offering to your customer class.

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