Changes to Texas Electricity Market Won’t End Volatility, High Prices
Even though the Public Utility Commission and the state’s grid operator are rushing to fix problems that have caused Texas electricity rates to soar, the changes aren’t guaranteed to bring lower prices, and may even carry unintended consequences that still result in high electric rates for customers who haven’t locked-in a fixed price. While the news is filled with reports about regulators trying to calm the wholesale market, Texas businesses should remember that even with the changes, the wholesale electricity price will still be designed so that, at times, it hits $2,250 per Megawatt-hour, or about 30 times higher what may be considered a "normal" price. All that means is that businesses should still be looking for fixed-price deals to avoid summer price spikes and volatility to avoid being left open to anymore unexpected turmoil in the wholesale market. Last week proved again that as businesses shop for a good
National Power Debacle Shows Danger of Going It Alone When Buying Electricity in Texas
Last week showed the dangers of choosing an energy provider without some qualified assistance, and why it’s essential customers get some help from a company like SaveOnEnergy.com before making an uninformed decision. National Power Company of Houston did the unthinkable and tried to raise rates for customers on fixed-price contracts, citing a buried “material change” clause in customers’ contracts. Customers who thought they were guaranteed a good rate of about 11¢ per kilowatt-hour shockingly started getting letters saying National Power was going to jack up the rate to 15.3¢, even though customers believed they had signed for a fixed price for as long as 18 months. After customer outrage, the Texas Public Utility Commission pulled National Power’s listing from the state’s electric choice website, and started an investigation. The experience – unfortunately not the first of its kind in Texas – shows the dangers of just picking the cheapest offer
Texas Business Owners Can Wait For Lower Energy Prices by Buying on MCPE
Texas businesses buying electricity in today’s climate of high energy prices face a tough question: is now the right time to lock-in a price, or are high prices temporary, and is a better deal just a few months away? For customers willing to accept a bit of risk in the short-term, Texas energy suppliers offer a product that lets customers ride the market, and avoid the prospect of locking-in a high price, only to see electricity rates fall a month later. It’s called buying on the Market Clearing Price for Energy, or MCPE for short, and essentially means the customer accepts the floating wholesale price for electricity in Texas , rather than locking-in a fixed price for a set term. While the mechanics of MCPE can be a bit complicated, finding an MCPE plan isn’t. Eight energy providers are waiting to compete and offer their best MCPE product to customers
Consider Locking-In Your Texas Electricity Rate Before Power Prices Follow Rises in Gasoline, Natural Gas
As energy prices continue this year’s trend of going up, up and up, Texas residents who haven’t locked-in their electricity price yet may want to do so before rates start rising appreciably, and a website like SaveOnEnergy.com makes things clear and simple for new electric shoppers comparing offers for the first time. Last summer, electric customers were wise to shop for short-term deals because natural gas was hovering in the $6/mmbtu range. But by the start of 2008, the price of natural gas had crept up to around $8, and now it’s trading near $10. It’s part of a rising tide of energy prices that saw the average statewide Texas gasoline price hit yet another record to end the week, with one gallon of regular unleaded hitting $3.214. Texas power prices are closely correlated to natural gas prices, because 70% of the electricity used to power the state’s main grid