When a retail or wholesale energy customer switches from one supplier to another a fee is often levied to compensate the supplier for costs the supplier may have incurred to make sufficient energy available for that customer. This is referred to as a competitive transition charge or exit fee. These fees are often necessary when generating facilities used by an exiting customer might otherwise be operated at a loss or shut down completely. This charge is not the same as a transition charge, which refers to transition from a regulated to a deregulated market. Competitive transition charges refer only to transition from one competing supplier to another.

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