In a turn of events that stuns absolutely no one, the energy generators in the state of Texas are once again attempting to leverage more money from the customers and retail electricity providers to line their pockets. And naturally, they are using the alleged, worst case scenario of an “energy shortage” in Texas and the fears surrounding it as their vehicle to increased profits. From the DMN article: Continue reading “Power Generators Continue Campaign to Squeeze Texas Electricity Customers Dry” »
I’ve written before about my concerns about how Texas electricity companies are selling electricity plans at a loss, and I’ve written before about my thoughts on electricity companies potentially going out of business during summer months. Now, I’d like to take a look at something based on both of those concerns combining to cause Continue reading “Is There an Texas Electricity Market Bubble?” »
After the PUC voted to raise the market cape earlier this summer (with more cap raises coming in upcoming years), there were a lot of concerns about whether or not Texas electricity companies would alter the rates of their fixed rate electricity plans because of increased costs on their end. This was a controversial concept, since they would essentially be breaking their contracts with their customers. The only REP that actually Continue reading “PUC Rules Electric Companies Can’t Alter Fixed Price Rates” »
The staff of the PUC has officially filed a proposal to raise the market cap to $4500, up from the current cap of $3,000. This has looked like a foregone conclusion for months now, Continue reading “PUC Officially Files To Raise Market Cap” »
In the past, I’ve had some pretty divergent opinions about deregulation and Texas Electricity with Loren Steffy, the chief energy writer at the Houston Chronicle. His latest article is no different, as I can’t help but roll my eyes at the usual swipes he can’t seem to help but take at the retail electricity market.
However, the subject of his latest article, Continue reading “Loren Steffy Shines His Light on Raising Electricity Market Cap” »
I lived in an apartment for years that had a smart meter, and despite the fact that I write about them regularly on this website, I never really paid much attention to them myself. However, I recently moved into a home with a lot more electricity usage. On top of that, I saw this quote in an article in the Fort Worth Star-Telegram last week, which I found really fascinating:
I’ve written before about the potential crisis in Texas due to the lack of new generation plants. Basically, not many new energy generation plants are being built, or even planned, at a time when Texas’s population continues to explode and our electricity needs along with it. The problem is that because of the deregulated electricity system, all new plants must be built by private investors instead of by taxing customers or raising electric rates. And right now the low cost of natural gas and the lack of guaranteed profits have investors leery of risking the construction of new plants in Texas.
A commonly referenced solution Continue reading “ERCOT Price Market Cap Changes Appear Politically Motivated” »
I was perusing an article from Carol Penny, a local contributor for the Austin American Statesman, and I couldn’t help but think one thing: at least the article was published under the “Opinion” category. Sheesh. Opinions don’t need factual support, so she has that going for her, I suppose… Continue reading “Austin Contributor Backwards on Electric Deregulation” »
Yes, I’m still writing blog posts about TCAP’s recent release of their “history” of deregulated electricity in Texas which they have been still pushing out heavily through PR channels the past couple weeks. I know I initially said I didn’t want to do a 10 part series on this topic, but I never said it wouldn’t take me four or five sections just for me to get through the broad strokes. Which brings us to Part Four. As things stand, I’ve gone through the “Facts” the document claims to examine as well as their “Major Findings” section. In this post I’m going to evaluate their “Recommendations” section. And after that I may or may not write a couple posts looking at some of their more hilarious pieces of “data,” as well as a closer look at TCAP the organization.
Texas electricity had a very busy year in 2011. There was a lot of different and important news stories from several unexpected angles that had an important impact on consumers and their electricity bills. And as far as years go, lots of the stories that started in 2011 could have a huge impact on 2012 and beyond. Lets take a look back at some of the biggest stories of the year for Texas electricity.
Record Heat, Cold, and Rolling Blackouts – Easily the biggest story of the year for electricity in Texas was the weather. Texans are used to sweltering summers, but not nearly to the level of what we saw in 2011. Records indicate it was the hottest summer in Texas since the 1700′s, primarily because of the record drought and lack of rainfall that worked to cause a 40 day consecutive streak of greater than 100 degree temperatures in Dallas, many of which were closer to 110 than 100. Electricity bills soared for customers on variable and indexed plans, and the threat of rolling blackouts seemed to hang over the entire month of August because electricity supply barely met demand. And it wasn’t just the summer. A particularly violent cold spell hit Texas in the winter and caused several power plants that weren’t properly cold-weather fortified to fail…which in turned caused rolling blackouts. And again, because supply didn’t meet demand, many customers had some big bills. All in all, the weather was was almost certainly the biggest story of 2011.
EPA Cross Pollution Rules – The Cross State Pollution rules that the EPA implemented have probably been the most talked about subject in the news that relates to Texas electricity. There have probably been at least 1-2 new stories every week on the rules and the whole situation became a complete political tug of war almost immediately. The rules are forcing many states to shut down certain coal-burning power plants that don’t meet new EPA standards. It is a concern in Texas because after the threat of rolling blackouts last summer, if the EPA changes take effect there will be even less power plants online in the summer of 2012 and the state barely skated by without rolling blackouts in 2011. Another hot 2012 summer and Texans could be in big trouble.
Regulation Loses Some Luster – For years people have been taking cheap shots at Texas deregulated electricity by pointing out that prices in Austin, San Antonio and other regulated areas of Texas are cheaper. Some supposed consumer advocates like Recharge Texas kept hammering the point for their own political agenda. Of course, that tactic started to ring hollow when it was revealed that Austin Energy has run up a 225 million dollar debt for not raising rates with market prices, El Paso Electric became embroiled in a huge political dispute over their very high regulated rates, and it was revealed that the highest rates in Texas belong to regulated Entergy and they’re going up in 2012 even more. Some other guys even got in on the act of doing a true evaluation of deregulated electricity rates in Texas, and the results show without a doubt that people who shop, save. To the tune of more than almost any other state in the country. Hooray for deregulation. The next step is to just educate more people.
Big Electricity Companies Buy Independent Power Companies – If there was one clear trend in the 2011 Texas deregulated electricity market, it was the sale of smaller Retail Electricity Providers to bigger conglomerates. Constellation Energy bought StarTex Power and MX Energy. Direct Energy bought First Choice Power for a huge sum. Dominion Power/Cirro purchased Simple Power. Just Energy purchased Fulcrum Power (Amigo and Tara Energy). NRG purchased Energy Plus Holdings (not centered in Texas), but that is on the heels of the huge energy giant purchasing Reliant and Green Mountain Energy in 2009 and 2010. Overall, most industry experts agree that the big guys in the market with cash and resources will continue to purchase the smaller companies that continue to prove successful in customer service and acquisition.
AEP Texas and their license to sell Retail Electricity – I’m not going to spend too much time evaluating this one, as I’ve recently written several huge articles with the details and long term potential impacts (parts 1, 2, 3, and 4). However, the license hearing of AEP Texas in their efforts to get a retail electricity license and operate under the AEP name is a very big deal. Even if most Texans don’t even realize it. If could lead to Centerpoint and Oncor also selling electricity, and not just maintaining power lines and poles, and make Texas electricity even more confusing.
That’s five of the bigger stories in the world of Texas electricity for the year of 2011. If any other big news in the market crosses my mind, I’ll add them to this list and send out an update. But overall, it’s been a pretty big year for deregulated electricity in Texas.