As a barrel of oil hit $100 we saw natural gas prices spike to nearly $8 mmbtu but they have dropped 2 %Â today in hopes that they will come back down to where they have been. Electric rates in Texas were dramatically effected by the spike in natural gas and we saw rates bounce once again off of a consistent support level. For those commercial businesses who might have been waiting to sign a term energy contract they have seen any potential of getting in at the bottom eaten up by this volatility in the market. The best solution at this point is get in on some type of contract before risking the potential of the market rising any higher.
It isn’t always easy to follow the market and decide when would be the best time to get in but that is why there are hedged fixed term energy contracts. Each contract is made based upon where the market has justified that price to be based on simple supply and demand. If you compare a few offers on the same term from multiple Texas Retail Electric Providers then you are close to finding a good electric rate for your company. Rates are still pretty low right now and so the time is well to go ahead and make a decision. You can always try again next year when your energy contract expires. If your facility uses a lot of energy you might want to consider a blend with MCPE. This will reduce your rate by 1 1/2 to 2 pennys a kWh and save you some additional money. An Texas energy consultant can explain more about how this is done and what the potential risks are involved.