Electric companies say that most Texans switch their energy supplier in the third quarter of the year, after they receive their first summer bill for usage during June -- when air conditioning load and higher summer power prices give homeowners a heftier bill. With consumers being hit on all sides from record gasoline prices to rising food prices, homeowners can’t afford to wait until receiving that first high summer bill to seek out savings in the electric market. They need to find a better, more secure rate now, before running up their meter.
Residential electricity prices have skyrocketed in Texas from a confluence of factors – higher prices for natural gas, oil and coal, plus “congestion” in certain parts of the electric system, which has kept cheaper power from reaching metro areas like Dallas and Houston. Just look at these residential price increases for the cheapest market offer from January of this year to today:
|Corpus Christi (AEP Texas Central)Houston (CenterPoint)||28%|
|Dallas/Ft. Worth (Oncor)||27%|
|Texas-New Mexico Power:||18%|
|Abilene (AEP Texas North)||13%|
The most worrisome part for consumers is that those price spikes have come when prices are usually calmer – before summer heat puts severe strain on the electric system and causes more expensive power plants to generate electricity. If those are the spikes the market saw when it’s supposed to be quiet, there’s no telling how high Texas electric rates will jump in the heat of the summer – especially if a hurricane threatens to disrupt Gulf of Mexico energy supplies.
But customers can’t just blindly pick their energy provider. The dangers of going it alone hit home twice recently as two energy suppliers have defaulted, leaving about 23,000 customers to pay the most expensive electricity rate in the state.
And despite the run-up in prices, customers can still get attractive, term deals on electricity, and lock in a favorable rate to avoid summer price spikes.
One of the best offers may be Direct Energy’s 12-month price protection plan in the Dallas-Ft. Worth area (Oncor), given that the region can be hit by higher prices when the electric grid is congested. Direct’s price protection plan includes a rate of 13.5¢ per kilowatt-hour, a good deal considering that fixed rates may be well on their way past 15¢ in that region. Direct’s offer is the clear bargain among 12-month offers in DFW.
The Houston (CenterPoint) and Corpus Christi (AEP Texas Central) regions have higher prices because it’s tougher to move power into those areas. However, rates are still below the highs seen in the last period of volatile energy prices in 2006, and consumers still have a chance to lock-in a reasonable rate to avoid summer price shocks that cold reach 18¢ or even 20¢. Hudson Energy offers the lowest 12-month rate in both regions, at 15.0¢ in Corpus Christi and 15.3¢ in Houston.
The best deals are available in the Abilene area (AEP Texas North) and the Texas-New Mexico Power region where plentiful wind power is keeping prices down.
Gexa Energy boasts the lowest 12-month plan in the Abilene region, at 12.3¢. The plan also includes an extra value in allowing customers to earn American Airlines or Continental frequent flyer miles simply for using electricity. Additionally, Gexa offers a pretty cheap, 100% renewable power product in the Abilene area for only 12.7¢, a modest premium for green power that includes all the airline mile bonuses of Gexa’s standard plan. Commerce Energy offers an attractive 24-month plan for only 12.6¢ that gives customers added price protection.
For Texas-New Mexico Power customers, Gexa offers a great rate of 11.9¢ for its 12-month plan with airline miles. With energy prices rising unabated, a plan below 12¢ probably won’t be around much longer.