Default PSEG Long Island supply
If a customer does not contract with an ESCO, PSEG Long Island continues to provide electricity supply and the bill includes the current Power Supply Charge components.
Long IslandNYISO Zone KCommercial electricity
Long Island Energy Deregulation: What Businesses Can Actually Shop
"Deregulation" is the search term. The accurate Long Island decision is narrower: commercial customers may be able to compare electricity supply through LI Choice, while PSEG Long Island still delivers power and regulated charges remain part of the bill.
Long Island energy deregulation is best understood as electric supply choice. Commercial customers may be able to compare ESCO supply through LI Choice, but PSEG Long Island still delivers power, handles emergencies and metering, and regulated delivery plus the Local Supply Charge remain. The shoppable comparison is the Market Supply Charge versus ESCO terms.
Illustrative bill map
PSEG Long Island bill split
1
Delivery and utility service
Still PSEG Long Island / LIPA structure
Poles, wires, outage response, storm restoration, metering, and regulated delivery charges remain with PSEG Long Island and LIPA.
2
Local Supply Charge
Still applies
LIPA/PSEG statements identify this as applying to bundled customers and LI Choice customers.
3
Market Supply Charge
Comparison point
LI Choice customers do not pay the PSEG Long Island Market Supply Charge; they pay the ESCO supply charge instead.
The core distinction
Long Island choice is about supply, not the entire bill.
PSEG Long Island's LI Choice page explains that customers can buy supply from an Energy Service Company, but PSEG Long Island remains the delivery company. That means a supplier comparison should never be framed as leaving PSEG Long Island behind. It is a comparison of one bill lane, with the rest still governed by the local utility structure.
Delivery and utility service
Still PSEG Long Island / LIPA structure
Poles, wires, outage response, storm restoration, metering, and regulated delivery charges remain with PSEG Long Island and LIPA.
Local Supply Charge
Still applies
LIPA/PSEG statements identify this as applying to bundled customers and LI Choice customers.
Market Supply Charge
Comparison point
LI Choice customers do not pay the PSEG Long Island Market Supply Charge; they pay the ESCO supply charge instead.
May 2026 source snapshot
The published Power Supply Charge split shows why the wording matters.
Effective May 1, 2026, LIPA Statement No. 113-PSC lists the total Power Supply Charge and its unbundled Long Island Choice components. The Local Supply Charge applies to bundled and LI Choice sales. The Market Supply Charge is the bundled-supply comparison point.
| Component | Cents/kWh | Dollar equivalent | Why it matters |
|---|---|---|---|
| Total Power Supply Charge | 16.0182 | $0.160182/kWh | Average PSC for May 2026 |
| Local Supply Charge | 2.7372 | $0.027372/kWh | Applies to bundled and LI Choice sales |
| Market Supply Charge | 13.2810 | $0.132810/kWh | Bundled sales comparison point |
Sources: LIPA Statement No. 113-PSC and PSEG Long Island Electric Rate Information. Review date: May 11, 2026.
Decision paths
Three ways a Long Island account can think about supply.
LI Choice ESCO supply
Commercial customers may be able to compare ESCO terms through LI Choice. PSEG Long Island still delivers electricity and the Local Supply Charge remains.
Direct Retail Customer path
Some larger commercial and industrial accounts may evaluate Direct Retail Customer status. That path needs account-level review because operating requirements and market exposure can be materially different.
Zone K context
Why Long Island supply decisions feel different.
NYISO identifies Long Island as Load Zone K. FERC describes chronic southeastern New York transmission constraints into New York City and Long Island that can contribute to higher prices in those markets. That does not mean every ESCO offer is better; it means the supply lane deserves careful, current, account-specific comparison.
NYISO's 2025-2026 LCR report lists Long Island's final Locational Capacity Requirement at 106.5% for the 2025-2026 Capability Year, with an NYCA IRM of 24.4%.
What an analysis should answer
- Which bill components are fixed by tariff or regulated charge design?
- How does the account's usage shape compare with current Market Supply Charge exposure?
- Are ESCO terms fixed, variable, indexed, or subject to pass-through language?
ESCO contract checklist for Long Island accounts.
New York guidance emphasizes clear contract terms, cancellation rules, renewal language, fees, and written savings guarantees if any are claimed. For commercial accounts, the same discipline should be applied before treating a supply offer as budget certainty.
Is the price fixed, variable, index-based, or blended?
Which capacity, congestion, ancillary, line-loss, tax, and regulatory-change items can pass through?
Does the offer compare against the current Market Supply Charge and the account load shape?
What are the renewal, cancellation, and early-termination terms?
Does any savings guarantee exist, and if so, is it written into the customer disclosure statement?
Does the term match the facility budget cycle, operating hours, and expected usage changes?
Free analysis
Request a free Long Island bill analysis.
We review your regulated bill components, current supply exposure, rate class, usage pattern, and the questions a supplier comparison should answer. The goal is clarity first: what can be shopped, what remains regulated, and what contract language matters before any next step.
No obligation. KilowattLogic may work with energy-market partners or suppliers. Any next step should compare disclosed supplier terms, regulated charges, and account-specific usage before you choose a supply option.
Is Long Island electricity fully deregulated?
No. Long Island commercial customers may be able to shop electricity supply through LI Choice, but PSEG Long Island remains the delivery utility and LIPA/PSEG regulated charge structures still apply.
What part of a PSEG Long Island bill can be shopped?
The practical comparison is the PSEG Long Island Market Supply Charge versus ESCO supply terms. Delivery charges remain regulated, and the Local Supply Charge still applies to LI Choice customers.
Can an ESCO contract create budget certainty?
A fixed-price ESCO term may make supply costs more predictable, depending on contract language, usage, market conditions, and pass-through terms. It is not a guaranteed savings mechanism.
Does switching supply change who handles outages?
No. PSEG Long Island continues delivery, metering, emergency response, storm restoration, and essential customer service even when the customer buys supply from an ESCO.