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In deregulated energy states, consumers can choose their energy providers rather than being obligated to purchase electricity or natural gas exclusively from a single, regulated utility. In a deregulated or retail energy market, the generation and supply of electricity or natural gas are separated from the distribution and transmission infrastructure. The intent is to introduce competition among energy suppliers, allowing consumers to choose from multiple providers.

While the market is deregulated, regulatory bodies like Public Utility Commissions continue to oversee certain aspects of the energy industry, ensuring fair practices and reliability. It's important for consumers in deregulated energy states to carefully consider their options, compare plans from different providers, and assess their energy needs before selecting a supplier.