Electricity rates are rising and this is due to what appears to be a new trend in natural gas prices.
Natural gas prices seem to be on a new push on that upward trend that could likely see it hit much higher prices than most consumers are used to.
In Texas about 40 percent of your electric bill is affected by the price of the natural gas.
If you look at this weekly natural gas chart you can see the trend as it has developed over the last few weeks.
What do you think? Are natural gas prices headed for a continuing steep rise up or will they drop back down?
Usually when a commodity retraces 50 % or more of it’s previous large loss it will continue to retrace and make up 100 % of that loss.
This does not always happen but as you can see from the dip down and slow retracement above 50 % of that large gap down has been recovered.
Natural gas is a very unpredictable commodity so it is hard to know for sure what may happen but I expect to see it hit $5 mmbtu in the next 5 months.
What does this mean for the commercial or residential electricity service consumer?
I would spend today comparing prices using our website tool at the top and order electric service now while natural gas is still below the $5 mmbtu mark.
You will likely be locking in before the trend up takes effect again and you will be in a good spot for the next year or two as far as electricity price is concerned.
Also, it is worth noting that the cost of converting natural gas to electricity is up as well. This price factor is called “heat rate” and is on a trend up.
Before we see higher gaps up in price go ahead and check out our price comparison tool and lock in your rate today!