US Energy is Now Known as Just Energy
Just Energy also known as US Savings Corp has decided to go with the name “Just Energy” going forward but last summer of 2008 they were known as US Savings Corp and were one of the only Texas electric companies offering a 5 year fixed rate agreement. Last summer was historically significant for the Texas energy market as we experienced the highest electricity prices in Texas history. The summer of 2008 was not a great time in the market to sign up for 5 years on a fixed electric rate although the summer of 2009 makes perfect sense to sign up with Just Energy for a 5 year rate. Electricity prices are low across the board right now so signing up long term even if you pay a little more will give you price surety.
To compare Just Energy’s electricity rates with other energy service providers you may use the zip code electricity company comparison box above. Just type in your zip code and click on continue.
The summer of 2008 we saw a First Choice Power bill that was 31 cents per kWh and about the cheapest 1, 2, or 3 year fixed electric rate you could find was around 16 cents per kWh. Just Energy was offering the cheapest electricity rate for a 5 year fixed electricity agreement. The catch was that you had to sign up for 5 years. It is important to note why Just Energy was cheaper on a 5 year agreement than say a 1 year agreement. It is a little counterintuitive to most energy consumers why a longer term contract would be higher than a short term so most assumed that Just Energy was giving you a price break for signing longer term. The reason Just Energy had a cheaper rate had to do with the futures market. Texas electricity providers hedge their energy on the commodities market by buying natural gas futures. Sometimes the longer term contracts are cheaper and sometimes they are more expensive than shorter futures contracts like the 1 year. Just Energy is the only electricity company we know of that offers a 5 year fixed electricity rate agreement. Although last year when people would call us asking if they should sign a 5 year fixed electricity agreement regardless of the company we told those people not to do it. With all our customers we were recommending short term options only and to then wait for us to provide a go ahead when electricity rates had come down. This year (summer 2009) we believe Just Energy is a perfect fit for those needing to lock into a long term electricity rate even if it is for as long as 5 years.
A 3 year electricity rate in my opinion right now is the perfect fit for most but a 5 year is another safe way to go and will keep you locked in before electricity prices start heading back up. We always recommend that you shop around first before picking an electricity company but when choosing a 5 year residential electricity rate Just Energy is your only choice.
Texas Energy Prices Were Their Highest the Summer of 2008
Last year when prices were peaked out near there tops and a barrel of oil was trading at $140 you could get a cheaper long term futures contract like the 5 year contract. Just Energy had their rate advertised on the state run Power To Choose website and several other locations and many people were convinced after calling Just Energy that locking into a 5 year contract was the way to go because the rate was the cheapest. A few of their potential customers had called me to ask if signing Just Energy’s 5 year fixed rate was the way to go. I politely told several of these residential electricity customers that it would be unwise to sign a 5 year agreement, regardless of the company they were choosing!!! at the TOP!!! of the market. Amazingly none of these customers who talked to me agreed with me that a 6 month or 1 year agreement made more sense and as far as I could tell they all hung up with me and signed for 5 years at the highest rates in the history of Texas residential electricity service. I tried very hard to explain that these electric rates were based on commodities futures but none of them were really wanting to hear that advice at the time. A 5 year fixed rate was the cheapest for the summer of 2008 and for many people this was the way to go especially considering no one can accurately predict what energy prices will do.
Customer Confusion Over 5 Year Fixed Electric Rates
I remember one lady in particular I had spoken with and I told her she would be kicking herself a year from now because rates will likely come back down and you will have to stay on your 5 year fixed rate with Just Electric Company. At the time (summer 2008) I did not know that Just Energy allows customers the option of blending their current rate with a new market rate if electricity prices were to drop in price. A blend option is a very good option for those who feel like they are paying too much when prices come back down. Just Energy gives those customers the option of refiguring the higher electric rate to a much lower price once blended with the market rate.
The confused lady in 2008 asked me why she would have to stay on Just Energy’s contract and I explained that most electric companies offering fixed electric rates will have some type of early termination penalty. The penalty is usually to recover the investment in hedging the fixed energy for the customer and usually has a little profit margin in there for the provider. A 5 year fixed Texas electricity agreement would have a very steep early termination penalty and anyone who signed up last year with Just Energy would likely be very discouraged from canceling that early in an energy agreement. A better option would be to choose Just Energy;s blend option that figures the lower market price with the higher rate from last year. There is no need to consider cancelling an electricity agreement when the provider allows you to blend it down to a cheaper price.
We have had some calls and comments from people asking if canceling their electricity contract would be a good idea. We do not recommend cancelling your agreement with Just Electric Company or any provider. We do want to warn customers with any electric company that canceling an energy contract would not be worth it. It would be better to wait and hope that over the course of 5 years your energy rate ends up being worth it over the long haul especially when taking advantage of blending the rate with a lower price.
Jumping in and out of the stock market, electric rates, gold commodities and other such investments with no technical expertise in the markets is usually a bad idea. At this time we have seen no problems in the Just Energy contract, terms of service, or their advertised electricity price. From what we can tell everything looks good and legit from here. We do not have a business relationship with Just Energy and because of this we have limited experience on how the operate. Because of this we can only say that from our limited perspective and based on PUCT information they appear to be a solid and good electricity company.
If you are a Just Energy customer and have a question about your electric bill you can feel free to fax us a copy along with your question and we would be happy to investigate and do a bill audit. Also if inquiring about cancelling (which we do not recommend) let us know the early termination penalty that you have been quoted by Just Energy as we will not be able to figure out this part of your charges. You will need to call Just Electricity Company and ask them what it would cost to terminate the agreement early. Note: We do not recommend you cancel your Just Energy contract (try having them blend your rate with a lower price) but are only letting Just Energy customers know that we cannot provide this information.You can fax your Just Energy electric bill to 1-903-484-9222
As an example of what many Just Energy customers might be thinking this summer of 2009 we have provided a recent comment from a Just Energy customer who is now experiencing some second thoughts about signing up for 5 years. As you can see her situation seems dire as a “single mother” but for some reason as of last year a 5 year contract at over 15 cents per kWh was something she was interested in? The rate was a very good price as of last summer (2008) and this lady’s decision to lock in this long at the top of the market is not the fault of Just Energy. We are writing about this issue because Texas electricity customers many times are confused about why longer term rates are sometimes more expensive or less expensive than short term rates for what appears to be no reason at all. The technical reasons listed above will hopefully clarify this for some.
I have signed a 5 year contract with US Energy/Just Energy for 15.3 kilowatt a year ago in Houston Texas and see that everyone is offering better deals. I am a single parent on a FIXED income and my electric bill for May/June was $500.00!! The month before was $350.00. My home is as 10yr old modest home with 2,167 ft and think this is weigh too much!
I would like to break the 5 year contract but I know I will be penalized. Can you tell me what they would do to me? I just wish I could sign on with the company of my choice after 1 year! Please advise.
Concerned single parent homeowner,