Unbundling (functional unbundling)

Electric service is traditionally provided on a bundled basis, meaning that generation, transmission, and distribution services are provided as a single package. By unbundling, the packaged offering of the various services that make up traditional utility service are separated into discreet, separately-priced components. An example would be selling electric power distribution as a separate service without including costs associated with power generation or transmission services. Unbundling could allow the customer to select a different supplier or source for each of the components required to obtain a product or service.