How Switching Electricity Suppliers in Illinois Affects Your Credit Score and Deposit Requirements

Does Switching Electricity Suppliers in Illinois Require a Credit Check

The short answer is: it depends on the supplier. Illinois law does not require ARES to perform credit checks before enrolling customers — it's a business decision each supplier makes independently. In practice, most residential-focused ARES fall into one of three categories.

No Credit Check Required

Some Illinois ARES enroll residential customers without any credit assessment. This is most common with commodity-focused suppliers whose business model relies on volume and simple fixed-rate products. From a consumer perspective, this is the cleanest option — no inquiry, no deposit risk, straightforward enrollment. The trade-off is that these suppliers may have fewer product options or less flexibility on contract terms.

Soft Credit Pull Only

Many Illinois ARES perform a soft credit inquiry as part of enrollment. A soft inquiry — sometimes called a "soft pull" or "account review inquiry" — retrieves credit information but does not appear as a new inquiry on your credit report and has no impact on your credit score. Soft inquiries are invisible to other lenders. They're the same type of inquiry a credit card company uses when pre-screening you for an offer, or that you see when you check your own score. Most residential electricity supplier credit checks fall into this category.

Hard Credit Inquiry

A smaller number of ARES — typically those offering longer-term contracts, larger commercial accounts, or products with significant credit exposure — perform hard credit inquiries. A hard inquiry does appear on your credit report and can temporarily lower your credit score by a few points. Hard inquiries typically remain on your credit report for two years, though their impact on your score fades after about six months.

For most residential customers, a single hard inquiry from an electricity supplier is unlikely to have a meaningful impact on their credit score — especially compared to the impact of a mortgage application or auto loan inquiry. But if you're actively shopping for a mortgage, car loan, or other significant credit, it's worth understanding the inquiry type before proceeding.

How to Find Out Before You Apply

Before providing your Social Security number or authorizing any credit check with an Illinois electricity supplier, simply ask: "Will this be a hard or soft credit inquiry?" Any reputable supplier's customer service representative will be able to tell you. If they can't (or won't) clearly answer this question, that's a warning sign worth noting. Responsible ARES disclose their credit inquiry practices upfront in enrollment materials.

Working with an energy broker is another effective way to navigate this. Brokers who work regularly with ARES know each supplier's credit assessment practices and can steer you toward options that match your creditworthiness without unnecessary hard inquiries.

How Credit Score Impacts Deposit Requirements for Illinois Electricity Suppliers

When an ARES does require a deposit, the amount and whether it's required at all depends primarily on your credit profile. Understanding how suppliers assess this helps you anticipate what you'll face — and how to minimize it.

The Credit Score Threshold Landscape

While every supplier has its own specific criteria, the general pattern in the Illinois ARES market follows a fairly consistent tiering:

Alternative Creditworthiness Factors

Credit scores aren't the only factor. Many Illinois ARES consider additional elements when assessing creditworthiness:

• Utility payment history: A clean ComEd or Ameren payment record — even with an imperfect credit score — can satisfy many ARES that you're a low default risk
• Length of residency: Customers who have lived at the same address for several years present lower mobility risk than frequent movers
• Employment stability: Some suppliers for larger commercial accounts consider documented employment or business revenue
• Prepayment option: A small number of suppliers offer prepaid electricity products that eliminate the deposit issue entirely by collecting payment in advance

Deposit Amounts: What to Expect

When deposits are required, typical amounts vary by account type:

• Residential accounts: $75–$250 is the typical range, based on one to three months of estimated supply cost at average usage
• Small commercial accounts (under 50,000 kWh/year): $200–$750 typically
• Mid-size commercial accounts: One to two months of estimated supply cost; potentially $1,000–$5,000+
• Large commercial/industrial: Deposits often replaced by letters of credit, parent guarantees, or other credit support instruments

Interest on Deposits

Illinois law requires that security deposits held by electric utilities bear interest. ARES deposit interest practices vary — check your contract. Any deposit you pay should be documented in writing, with clear terms specifying when and how it will be refunded.

Strategies to Switch Electricity Suppliers in Illinois Without Hurting Your Credit

Even if your credit isn't perfect, you have multiple strategies available to switch electricity suppliers without credit score damage or unexpected deposit demands.

Choose Suppliers with Soft-Pull-Only Policies

The most straightforward strategy is to specifically ask suppliers whether they use hard or soft credit inquiries and choose those that use soft inquiries only. This eliminates any credit score impact entirely. An energy broker can quickly identify which suppliers in the Illinois market use soft inquiries versus hard inquiries, saving you the time of asking each one individually.

Lead with Your Utility Payment History

When contacting an ARES, proactively provide your utility account number and request that they access your utility payment history as part of their credit assessment. Many ARES have the ability to pull ComEd or Ameren payment records directly, and a history of on-time utility payments can satisfy their credit requirements even when your bureau credit score is suboptimal.

Time Your Switch Strategically

If you're aware of a near-term credit event — applying for a mortgage, car loan, or other significant credit — complete your electricity supplier enrollment before that event or after the lender's rate-lock period ends. One electricity supplier hard inquiry is unlikely to matter meaningfully, but managing the timing of any inquiries is a reasonable credit hygiene practice.

Use a Broker to Pre-Screen Supplier Options

Energy brokers have existing relationships with ARES and understand each supplier's creditworthiness requirements before you engage. A good broker can match you with suppliers that fit your credit profile — eliminating surprise deposit requirements and ensuring you're comparing apples to apples when evaluating rate quotes. There's no cost to you for using a broker; they're compensated by the supplier.

Shop Multiple Suppliers Before Committing

Each supplier's deposit requirement (and inquiry type) is disclosed in their pre-enrollment materials. Compare multiple offers before authorizing any credit check. You can review rate quotes and initial terms from most suppliers without triggering a credit inquiry — the credit check typically happens only when you formally authorize enrollment.

No-Deposit Electricity Suppliers in Illinois

If avoiding a deposit is a priority, you have real options in Illinois's competitive ARES market. Understanding what "no deposit" means in practice — and what to look for — helps you evaluate these options confidently.

What "No Deposit" Actually Means

A no-deposit electricity supplier is simply one that doesn't require upfront collateral as a condition of enrollment. This is standard for residential customers with acceptable credit at many Illinois ARES. It does not mean the supplier offers lower rates or better service — the no-deposit feature is just one component of the overall offer. Evaluate rate, contract terms, supplier reputation, and customer service quality alongside the deposit requirement when comparing options.

Finding No-Deposit Options

The most efficient way to identify no-deposit suppliers is through an energy broker or comparison tool that can filter supplier offers by deposit requirement. For residential customers with credit scores above 660, most reputable Illinois ARES will not require a deposit — so the field of no-deposit options is typically wide. For customers with lower credit scores, targeted broker assistance in identifying suppliers with alternative assessment approaches is particularly valuable.

Utility Default Supply as a Baseline

It's worth noting that your regulated utility (ComEd or Ameren) will always supply your electricity without a separate deposit requirement tied to your supply account — the utility credit assessment applies to your overall utility account, which predates any ARES relationship. If your ARES deposit options seem unfavorable, remaining on utility default supply while your credit profile improves is always a valid short-term strategy. However, utility default supply rates are often higher than competitive ARES fixed rates — so the cost of waiting may outweigh the benefit of avoiding a deposit.

Deposit Versus Rate Trade-off Analysis

Consider this practical analysis: suppose the best rate available to you requires a $150 deposit, while a no-deposit option is priced 0.5 cents/kWh higher. At 800 kWh/month usage, that's $4/month more for the no-deposit option. Over a 12-month contract, the rate premium totals $48 — while the deposit of $150 is fully returned at contract end. In this scenario, accepting the deposit and getting the better rate saves $102 net. Run this math for your specific situation before automatically choosing a no-deposit supplier at a higher rate.

Frequently Asked Questions: Illinois Electricity Supplier Credit and Deposits

Does switching electricity suppliers in Illinois hurt your credit score?

Only if the supplier performs a hard credit inquiry, which is less common. Most residential ARES use soft inquiries that don't affect your score. Always ask whether the inquiry is hard or soft before authorizing a credit check.

Do Illinois electricity suppliers require a deposit?

Some do, some don't. It depends on your credit score, payment history, and the individual supplier's policies. Customers with good credit typically don't face deposit requirements from most residential ARES.

How much is a typical electricity supplier deposit in Illinois?

Residential deposits typically range from $75 to $250. Commercial deposits vary widely based on account size, typically equaling one to three months of estimated supply cost.

Are there no-deposit electricity suppliers in Illinois?

Yes — many Illinois ARES don't require deposits for residential customers with acceptable credit. Comparing multiple suppliers through an energy broker is the most efficient way to find no-deposit options with competitive rates.

How can I switch electricity suppliers without a credit check?

Choose suppliers that use soft inquiries only (which don't affect your score) or that don't require any credit check for residential enrollment. Ask each supplier upfront about their credit inquiry practices before authorizing enrollment.

When does an electricity supplier deposit get refunded?

Refund timing varies by supplier and is specified in your contract. Most suppliers return deposits after 12 months of on-time payment, at contract end, or upon account closure. Verify refund terms before signing.

Does my credit score affect which electricity rate I qualify for?

Not directly for most fixed-rate residential products. Credit checks are primarily used to determine deposit requirements, not to set supply rates. Everyone who qualifies without a deposit generally pays the same published rate.

What credit score do I need to avoid a deposit with Illinois electricity suppliers?

Generally, a score of 620 or above avoids deposits at most Illinois ARES. Scores above 660 give you access to nearly all suppliers without a deposit. Scores below 580 more commonly trigger deposit requirements, though utility payment history can sometimes substitute.