Interesting Texas Power Facts for 2013

  • This year Texas has to deal with a Texas summer like we have to do every year but it won’t be the scorcher we typically have as we did in 2011.
  • Even though things will not be as hot we still have to contend with drought issues that likely will get even more severe than they have in the last few years.
  • Nuclear power provides 6% of electricity capacity for Texas, but will provide more than 12% of electricity actually used in 2013.
  • An agency called ERCOT (Electric Reliability Council of Texas) manages the  flow of electric power to 23 million Texas customers – representing 85 percent of the state’s electric load.
  • Natural gas and then coal are Texas’ primary electricity generation sources.
    • Texas has the largest wind capacity in the United States but still only produces 5 % of its electricity from wind power.
    • Texas holds a quarter of the United States oil reserves.
    • Texas holds 30 % of all US natural gas reserves.
    • Texas refines over a quarter of all petroleum fuels.
    • Today, there is no cost-effective way to capture the carbon dioxide
      output of the combustion of natural gas and coal, so any regulations that limit carbon dioxide emissions
      will either limit the use of natural gas, petroleum, and coal, or dramatically increase their
      prices which poses a threat to Texas’ refining businesses and natural gas resources.
    • Texas is not a member of a regional agreement to cap greenhouse gas emissions.
    • Texas does mandate that utilities generate from renewable sources a certain amount of
      the electricity that they sell.
    • Texas has the 16th highest Electricity Price, per kWh 10.18¢ on average compared to the rest of America. Although we have abundant supplies of natural gas we have to import coal and we have little in the form of hydro.
    • In 2011, Texas’s 27 petroleum refineries had a capacity of over 4.7 million barrels of crude oil per day and accounted for 27 percent of total U.S. refining capacity.
    • Texas accounted for 28 percent of U.S. marketed natural gas production in 2011, making it the leading natural gas producer among the States.
    • Texas led the Nation in wind-powered generation capacity in 2010 and is the first State to reach 10,000 megawatts of wind capacity.
    • Texas has a wide array of energy consumption but virtually no cheap hydro power.

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Wow, 4.3 cents per kilowatt hour for Electricity

lightRight now the state shows some whopping low prices for electricity rates such as the 4.3 cent rate marketed by Pennywise Power.

Pennywise Power is owned by NRG Energy which owns Reliant Energy and this 4.3 cents per kilowatt hour rate is a 3 month rate that is subject to change after those 90 days are up.

Most people refuse to be reminded about their rate plan coming to an end until their electric bill shows them a need to change.

Providers that offer the short term prices that are exceptionally low often have that rate expire at a rate much higher than what they first signed up with.

What happens is that any losses the electric company might have incurred by offering such a low rate get recouped in the ultra-high price the rate goes up to upon the contract expiring after 3 months.

I have no way to tell you for a fact that Pennywise will be dramatically raising their rate after 3 months but it is a typical game that gets played in the industry.

By the time a customer gets an electric bill with an off-contract electricity rate on it as much as 45 days has past that the customer has been switched to the new rate.

What happens is that you go through over a month of electricity usage on a new rate before you see that the rate has gone up dramatically on you.

When you get your first new bill with the higher rate there is usually a lot of griping and complaining but it might not be until another week or two that you change companies.

Once you compare rates on a site like ours and find a different company you might have been on the higher price for closer to two months and you are just now getting with a new company that can lower that price back down.

That 4.3 cents per kilowatt hour rate may over time wind up averaging out to 7 – 8 cents per kilowatt hour once the rate goes up on you without your close attention and you take time changing to a cheaper provider.

Be careful you don’t get hooked into a short term fixed price because it will not be fixed for long and your penny wisdom is only good for the amount of months specified on the contract.

My best advice is to choose a 12 month contract at the very least and set a phone reminder to go off letting you know a couple weeks before your contract is up so you can renew your contract.

 

Texas Deregulation Has Lowered Consumer Prices Despite What Opposing Voices Say

electricitmarketsI have read many articles over the last few years of how electricity deregulation in Texas is not working. I hate to jump on conspiracy theory band wagons but the news media always seems to point out that electricity deregulation hasn’t worked and give biased stats to direct the reader to the same conclusion.

When you look at the whole picture the numbers show a different conclusion than what is touted in the news. Electricity deregulation in Texas actually has reduced electricity prices for consumers in Texas.

In reality Texas consumers enjoy shopping for a cheap electric company in Texas and routinely do so and are benefited by lower prices.

If you are an electric service consumer in a deregulated area of Texas and are willing to shop for the best price you will pay far below the regulated prices you saw a decade ago under regulation by the state.

When you add in inflation to the price of electricity it comes out even better for the consumer.

Let’s consider the most competitive city in Texas for retail electricity, Houston. The Centerpoint Energy utility area covers the city of Houston and surrounding cities.

A year ago a 1 year fixed rate could be had for about 9 cents per kilowatt-hour. The variable prices you could find went for around 5.2 cents per kilowatt-hour for the first month.

Compare these rates from last year with 2001 prices when Texas was still under complete electricity price regulation by the state.

In 2001 the regulated price for electricity was 10.4 cents per kilowatt-hour in the city of Houston and cities surrounding Houston. When you factor in inflation the comparable rate as of today would be 13.6 cents per kilowatt-hour.

As of today a consumer can shop around and save about 45 % less than what you could get in the not so competitive electricity market of 2001.

Think about this for a moment, have you seen a reduction in your cable television bill, phone, groceries, taxes since 2001? In comparison electricity has been declining in price in Texas over the last few years but many other essential services have been going up.

Lower natural gas prices definitely help keep your electricity price cheap but as of right now the Henry Hub spot price for natural gas is actually 40 % higher than it was in December of 2001.

Considering Texas generates much of its electricity using natural gas this should surprise you that in a competitive market we have lower prices even with a disadvantage in the price of the raw resource we use to generate electricity.

You will find some municipalities and Co-ops in the state that charge their customers less for electricity than in retail areas but this is not true in all municipalities and co-ops and often changes. In fact right now many municipalities and co-ops are undergoing rate changes.

I have seen Co-ops and municipalities that have prices below some retail providers as of today that at one time were charging 2 cents per kilowatt-hour higher than everyone else.

I bring up the example of the municipality and Co-op to simply explain that you can’t point to the municipality that happens to be lower in price for a few months as to proof deregulating an electricity market doesn’t work.

Even with a cheaper price coming from a municipality you will still find areas of the state that are deregulated with even cheaper prices than the municipality. The problematic price difference next door such as Tyler Texas’ prices and Longview’s prices don’t give you an accurate picture.

A municipality escapes several expenses a retail electric provider has simply by being a municipality with access to public funds but even still some retail providers in Texas remain cheaper.

A common argument is also that had the state of Texas kept the electricity markets regulated prices would likely have remained unchanged. This is very unlikely when you take into account that utilities have taken on rate increases to build more power plants, upgrade transmission lines and power poles, and simply to fund operations like health care and pensions for employees.

Even under regulation news organizations would likely still banter about that the regulated electricity market has run a muck each time a price increase happens to cover these utility upgrades.

The California energy market manipulation of 2001 that had Reliant Energy charged and Enron trading managers plead guilt to market manipulation is used to explain that an electricity market should never be deregulated.

In reality California is a benchmark case study in what not to do and has allowed other states to set up a system that prevents such manipulations from ever happening again.

The Texas PUCT, ERCOT, and others police the energy market transactions that happen in Texas and have even been blamed for over policing the system causing inefficiencies in the deregulated market. If anything Texas does too much to police the energy wholesalers that deal in these very large energy block trades.

In summary, it should be obvious when looking at the whole picture that deregulation has had a huge benefit to the electricity service customer by actually lowering prices. If you want to make the competitive markets work in your favor you need to shop for the cheapest provider each time your energy contract is up. I always recommend putting a reminder to go off in your phone a month before your contract ends so you are sure to always have the lowest price a competitive energy market is able to give you.

You can read more about this topic by going to this article

You are Exempt from the 6.25 % State Sales Tax if Your a Residential Electricity Customer

You may be with one of the many customers that signed up with a residential electric company that is charging you a 6.25 % fee and calling this fee State Sales Tax.

They may explain to you that this fee is required and that there is nothing they can do to remove it but this would be a very bad mistake on their part to make such a claim especially if you are recording the phone call.

In reality, these energy suppliers that are charging this fee in Texas to residential electric customers are pocketing that money because the state does not require this money from residential electric service customers.

Imagine providers getting away with tagging on an additional 6.25 % on their electric rate and yet getting to advertise a rate that shows something cheaper.

Almost all of us would fall for this scheme and so you can imagine why a few dishonest electricity companies would try to squeeze out a little more from you by adding an additional line item in the bill called “Texas State Sales Tax”

Fortunately most energy providers do not do this and many of the ones that are doing it have been fined, penalized, and made to refund back this money by the PUCT.

You can read the actual Texas state sales tax rule for residential electric service on this page http://www.window.state.tx.us/taxinfo/taxpubs/tx96_1309.pdf where it clearly explains residential customers are not to be charged.

In the most recent example of this cramming of additional charges into an electric bill the excuse given was that some residential customers were simply accidentally classified as commercial customers.

I recommend that everyone get out their most recent electric bill and just make sure that 6.25% state sales tax is not showing up on your bill too.

Van Texas Electricity, You Can Compare Companies and Save

In Van Texas you can compare multiple retail Texas electric providers rate plans against each other, find the cheapest one, and order electric service at a substantial discount.

Our online comparison tool is easy to use. You enter your zip code in the box and click on “Compare”.

From there a list of Van Texas electric providers and rate plans will appear.

You can rest confidently that all fees and charges are bundled into our electric rates excluding taxes.

We are unlike most electricity companies and aggregation sites in that we take steps to bundle in all fees and charges so you are not tricked into a rate that appears cheaper than it really is.

We have even gone so far as to allow you to adjust your average monthly kilowatt usage in case you use more or less than what we have the default set at to calculate your rate.

We have our rates calculated with all fees and charges built in based on the average Texas energy consumers monthly electric bill so chances are good the rate you see will be at or higher than what you will actually pay.

To crystallize what I am trying to tell you here in simple terms, our rates are straight forward without the standard hidden fees and gimmicks, you can compare multiple discount providers, and you can order your Van Texas electric service online.

If you have any questions our Van Texas energy consultants located in Tyler Texas can assist you. You may call us at 1-800-971-4020.

Electricity Bid helps you find an electric rate and provider to save you money and keep life simple.

Get in touch with us!