{"id":4100,"date":"2018-10-22T11:55:09","date_gmt":"2018-10-22T16:55:09","guid":{"rendered":"http:\/\/www.texaselectricityratings.com\/blog\/?p=4100"},"modified":"2023-05-24T14:51:17","modified_gmt":"2023-05-24T19:51:17","slug":"shop-texas-electricity-rates-low","status":"publish","type":"post","link":"https:\/\/www.texaselectricityratings.com\/blog\/shop-texas-electricity-rates-low\/","title":{"rendered":"Shop While Texas Electricity Rates Are Low!"},"content":{"rendered":"
\"Summer\u2019s

Texas electricity prices are heading back down from summer highs \u2014but they won\u2019t stay low for long!<\/center><\/p><\/div>\n

Should I Shop Now For A New Texas Electricity Plan?<\/h2>\n

When you click on the graph showing Texas historical electricity rates<\/a>, you’ll see those high Texas retail electricity prices from the summer are settling back down to normal. That\u2019s all because since the summer cooling crisis gone, Texas electricity providers are now bringing down their prices. That\u2019s great news for homeowners in Dallas and residential electricity customers in Houston<\/a> as well as the rest of the Lone Star state. Nicer still is that electricity prices are at their lowest rates<\/a> now since last February. Not surprisingly, lots of folks are asking if whether they should be shopping for a new Texas electricity provider.<\/p>\n

The answer is an emphatic YES! In fact, you do it sooner than later. EIA market analysts predict that natural gas prices are expected to rise. Since most electric power plants in ERCOT burn natural gas, Texas electricity consumers should expect electricity prices to edge a little higher as cold weather arrives.<\/p>\n

Natural Gas Prices and Texas Electricity<\/h3>\n

Texas and lots of other states burned LOTS of natural gas from June through September to generate a lot of electricity. So much that in July, natural gas amounts in storage fell below the five year minimum and have stayed there. Though there\u2019s no dire shortage (more gas is still being put into storage), the low level has been affecting natural gas futures. Here\u2019s why: the five year minimum is 3,325 billion cubic feet (bcf) and last year saw an ample October storage amount of 3,638 bcf. According to the EIA\u2019s weekly natural gas report<\/a>, last week\u2019s level was just 3,037 bcf. That\u2019s roughly 300 bcf below the five year minimum and 600 bcf below last year.<\/p>\n

Because of the persisting low storage levels<\/a> and the high rate of natural gas burned to generate power (\u201cpowerburn\u201d), EIA expects that average household bills for most major energy sources of home heating will rise this winter due to due rising energy prices. On average, EIA forecasts<\/a> \u201cnatural gas bills to rise by 5%, home heating oil by 20%, and electricity by 3%.\u201d<\/p>\n

Natural gas traders are naturally wanting to cash in on the combination of low storage levels and high demand from cold weather. In fact, over the past couple of days, natural gas traders\u2019 eyes fixed on weather predictions for the next 21 days in the hope that a forecasted blob of cold weather actually would set in over North America at the end of the month. But on October 18, when the forecast changed to more moderate temperatures<\/a> both the spot price for natural gas and the NYMEX November contract price fell by around 10\u00a2 .<\/p>\n

Sounds good, right? No cold weather and retail energy prices in Dallas<\/a> and the rest of Texas will stay probably stay low for the next few weeks. But\u2026when will the weather turn cold?<\/p>\n

If You Don\u2019t Like the Weather in Texas\u2026<\/h3>\n

NOAA\u2019s 2018-2019 Winter Outlook<\/a> favors warmer temperatures for much of the U.S. partly due to an expected El Ni\u00f1o emerging sometime in November or December. Although weak, it\u2019s expected to exert enough influence along with other factors that will bring \u201cabove-normal<\/a> season mean temperatures\u201d to the lower 48 and Alaska. Texas will likely see somewhat cooler, wetter conditions. ERCOT forecasts the state will be close to normal temperatures \u2014 not quite as cold as last winter and not as warm as the two winters prior.<\/p>\n

The obvious good news here is that natural gas prices will likely stay low for just a little while longer and the same follows for electricity prices in Texas and the rest of the U.S. There\u2019s also the good news that the longer that temperatures stay seasonally warmer, the more natural gas can be injected into storage. Since the speed at which stored gas gets drawn down depends on the severity of winter weather, the more that goes into storage, the less likely for energy prices to rise sooner \u2014 especially as the storage amount draws nearer to that psychologically-important five year minimum level.<\/p>\n

Of course, this assumes that this year\u2019s injection season<\/a> ends by the second week of November. So in reality, there\u2019s not a whole lot of time left until wide-spread cold weather will start firing up natural gas furnaces up north and start drawing down the supply.<\/p>\n

Should I Shop for a New Electricity Plan?<\/h3>\n

If you\u2019re hesitating about whether or not to shop because you\u2019re not sure or if you\u2019re thinking you have time to find a better deal, bear in mind that all these factors effecting how long prices stay low depend on:<\/p>\n