Tuesday, March 29, 2011

COMMENTARY....

Not too many years ago, our ancestors read by light from a candle, an open fireplace or an oil lantern.  Do you recall that Thomas Edison invented the light bulb in 1879.  It may surprise all that in 1891, the Ames Hydroelectric Generating Plant, located near the mining town of Ophir, Colorado, was the world's first commercial system to produce and transmit alternating current (AC) electricity.

Across this county, electricity was first used to power street lights, factories, public buildings and work places like the mine in Colorado.  First homes to get electricity were new homes built around 1905 - 1910.  Development of the technology has been  remarkable and not fully recognized or understood by many.  The industry is complex.

Today, we give little thought to electricity, its origin, how it is produced or delivered to our home, office or business.  Most take it for granted.  We flip a switch and the light is on.  The bill arrives each month and is paid.  That attitude was perhaps acceptable prior to deregulation, but, assuredly, it is not now.

Since 1 January 2002, a large majority of Texans have been buying their power on an open market the same as food, gasoline and health insurance.  We, as individuals, have been made to assume full responsibility for the shopping and  purchase of our electricity.

I maintain that the market developed under the restructuring laws has not yet become truly competitive, lacks fairness and sufficient consumer protections.  The interests of big business are favored over the consumer.  Actions are needed to rectify the problem.  Again, I urge all responsible citizens to join the fight to lower our costs.

NUMBER OF REPS CURRENTLY LICENSED....

As of today, data available at the PUC website indicates there are currently 118 active, certificated REPs.  Of this number, 20 are licensed as Option 2 providers.

Option 2 providers cater to the industrial and large commercial class of customers in the state....refineries, for example.  They do not provide service to residential customers.  44 of the remaining 98 advertise on Power to Choose for our residential business in the CenterPoint service area.  The numbers vary for the other service areas.

This large number of REPs and the seemingly endless and varied rate plans they offer aren't making the desired contribution to competition and the lowering of rates.  Instead, confusion abounds.

Many consumers find it too difficult to make a choice of a new provider and don't bother with the drill and don't seek out the lowest cost plans that meet their requirements.  I find this situation exists with so many homeowners that I have an opportunity to visit with.  That is regrettable for we all suffer the consequences.

IS TEXAS ELECTRIC COMPETITION WORKING FOR CONSUMERS? LET'S LOOK AT AN OLD BILL....

Read the complete article by Tom Fowler, business energy reporter with the Houston Chronicle.  USE THIS LINK.

FLAT RATE PLAN PRODUCTS ARE SIMPLE BUT NOT ALWAYS LOWEST COST....

We applaud Simple Power for its flat rate plan products, simple to read Facts Labels and monthly billing statements.   There are no confusing tiered rates, monthly service charges or hidden fees.  Review this Sample EFL and Terms of Service for their 6 month fixed plan for all service areas.  Caution....the rates are subject to change.  Visit Simple Power's website for current data.

The simplicity employed by this REP is a standard I would like to see throughout the market by all licensed providers.  Such a standard has been recommended by the introduction of SB948 discussed in an earlier posting to this blog. 

All customers will need to make separate cost analysis of the rates specified at the time of switching based on their usage profile to determine if overall savings can be achieved by choosing the REP.  Remember, I chose a different provider recently that offered a tiered rate structure of 8.5/8.2/8.0 with a $6.95 monthly service charge for any month with less than 500 kWh usage.  For me, that product netted a lower total cost for the 6 months compared to the 11 cents rate from Simple.

Through this example, can you see the complexities built into the market and all the games the REPs are playing with us.  This is why we need reform of the laws and a new consumer protection agency.

NATURAL GAS AND ELECTRICITY PRICE UPDATE....

U.S. Natural Gas Prices.  The Henry Hub spot price averaged $4.09 per MMBtu in February 2011, $0.40 per MMBtu less than the average spot price in January 2011 (Henry Hub Natural Gas Price Chart).  EIA expects that the Henry Hub spot price will average $4.10 per MMBtu in 2011, a drop of $0.29 per MMBtu from the 2010 average.  EIA expects the natural gas market to begin to tighten in 2012, with the Henry Hub spot price increasing to an average of $4.58 per MMBtu.

U.S. Electricity Retail Prices.  During 2010, retail prices for electricity distributed to the residential sector averaged 11.58 cents per kWh, about the same level as in 2009.  EIA expects residential prices to rise by 1.0 percent in 2011, followed by an increase of 0.5 percent in 2012 (U.S. Residential Electricity Prices Chart).  The effect of lower generation fuel costs in 2011 should be more evident in retail prices for electricity distributed to the industrial sector, which EIA projects will fall 1.6 percent during 2011 and then rise 0.2 percent next year.

READ FULL REPORT

Sunday, March 27, 2011

BASIC PROTECTION NOT PROVIDED....

The misleading and confusing monthly base or service charge assessed on our electricity accounts by many of the REPs is the culprit.  They practically void our interpretation and analysis of Facts Labels.  In our judgment, they should be prohibited by the PUC rules as being unfair.

First point....these added fees represent a loophole left open by the rules and are not fully understood by most.  They distort our analysis of "apples to apples" comparison of rates.  They provide added profits to the REPs by increasing the average cost we pay for our power.

Secondly, these additional charges on our bills are predicated on low usage.  This practice, employed by the REPs and permitted by the PUC, runs counter to conservation.  The customer should be rewarded for lowered usage....not penalized.

Finally, I want to highlight that the charges raise the effective rate being paid for any month they are assessed.  The advertised rates shown on Facts Labels (EFLs) are inaccurate in these cases.

Saturday, March 26, 2011

ENACTMENT OF SB948 WOULD BE A FAST CURE ALL FOR THE ILLS OF OUR ELECTRICITY MESS...


Citizens of Texas....you must become fully informed concerning a piece of new legislation introduced by Senator Wendy Davis of Dallas in the current session.  A key provision of SB948 that would restore fairness to our electricity marketplace in an instant is quoted below:

"(8)  to receive at least one written standard retail service package offer, or a description of such an offer, from a retail electric provider, on a commission-approved standard form with a standard font size, typeface, and page limit, that:
      (A)  offers service for at least 12 months;
      (B)  charges a fixed price per kilowatt hour throughout the term of the offered service period; and
      (C)  does not include a fee that the commission does not require the retail electric provider to charge."

Get involved to promote consideration and passage of this bill in every way possible.  Follow progress of the bill using THIS LINK.

GET ON BOARD WITH THIS PROPOSAL....

CHAPTER 17, titled CUSTOMER PROTECTION, SUB-CHAPTER A. GENERAL PROVISIONS, Sec. 17.001. CUSTOMER PROTECTION POLICY, sub-para (b), of the PUBLIC UTILITIES REGULATORY ACT,  confers on the Public Utility Commission the authority to adopt and enforce rules to protect retail customers from fraudulent, unfair, misleading, deceptive, or anti-competitive practices.  The law further states that all buyers of retail electricity services are entitled to these customer protections.

I hold a strong opinion that the commission is not upholding this responsibility and is not adequately policing the marketing practices of the REPs to identify wrongdoings and taking corrective actions.  The tricks, gimmicks, unfairness and confusion rampant in the restructured marketplace continue to harm the residential and small business customer big time.

A new and completely non-partisan and independent consumer advocacy/protection organization, patterned after those found in other states, fully staffed by qualified personnel and initially funded by the state, tasked to clean this mess up, should be sought by our consumer friendly legislators in this current session.

Post your comments and opinions on this proposal as quickly as possible and help achieve the goal by your own actions.

Saturday, March 19, 2011

REP PRACTICIES ARE DESIGNED TO FOOL AND CONFUSE....

The majority of the REPs operating in the Texas retail electricity market are following sales and marketing strategies, tactics and practices designed to confuse and abuse the residential consumer.  There are insufficient protections in place to prevent this abuse.  The evidence is clear.  Just read this blog.

Most customers are fooled by the use of tiered rates, monthly service charges, confusing EFLs and Terms of Service,  hidden charges and etc. The REPs can employ these tactics because they have the upper hand.

The homeowners in this state are not well represented with a completely independent and effective consumer advocacy organization.  The people have no real voice or representation.  This can and must change.  Establishment of a new consumer friendly organization or reorganization of those already existing has become a new focus of this blog.

The mere number of REPs and the multitude of products they offer is overwhelming for average Joe Homeowner.  Making a choice is not easy and too many consumers don't want to mess with the hassle.  The REPs rely on that consumer attitude.  At last count, for ZIP 77379,  there were 45 providers offering 257 different rate plan products, all types.  The number of fixed 12 month plans to choose from was 79. 

The industry lobby and the PUC tout the number of  REPs operating in the market as evidence that competition is working.  We believe that the excessive number only confirms the structuring of the market is tuned for the benefit of business and profits and not for the people.

We're paying too much for our electricity.  The profits built into the current market are too high.  We, the people can do better.

Just more straight talk....

IT'S TIME FOR SHOCK AND AWE AND FOR NAMING NAMES....

Yes, a new era has begun with the changes to take place with this blog.  More drastic measures are needed to gain readership and interaction with this blog and this will be our new tactic.   Accomplishment of our vital mission is of utmost importance.

The misleading, unfair and sometimes fraudulent sales and marketing practices being used in the retail market will begin to be identified and tied to the REP responsible by name.  Those doing good things will be praised along with the bad guys.  A plan is being explored for the development of a grading system for the REPs. A volunteer is urgently needed to assist with this project.

Also, help is needed to do this social networking thing.  Is anybody out there willing to volunteer to assist with that new angle?  Stay tuned for future postings.

NEW DIRECTION, NEW MISSION AND GOALS….

Phase four has begun with new vigor.  See preceding posting below for explanation of phases 1 thru 3.  Our undertaking has taken on more importance.  It is time to act more boldly and with purpose.

Assistance is needed in information technology, social networking, consumer advocacy, state legislative and energy regulatory matters, not for profit organizations, fund raising, communications, legal, and utility deregulation in general.

Volunteers in these areas of expertise or others may indicate their availability and willingness to serve or consult by adding a comment to this or any other posting.  You may also email:  theelectricityguy@sbcglobal.net.  We need more capable activists to join the team. 

The education and awareness campaign begun with the launch of this blog over a year ago will not end.  Considerable factual information, opinions and guidance for assisting all homeowners in dealing with the unfair practices of the deregulated retail market will continue to be published.

News goals of strengthening advocacy on behalf of the electricity consumers of the state in every way possible and for returning fairness to the marketplace are being adopted.

Specific unfair practices and identification of the offending REP will begin to be disclosed on the blog.  Friends and partners to this effort will be identified and encouraged to become more active and effective.  Help is needed from all corners.

Lastly, the establishment of a new, independent consumer advocacy organization will be explored if that is found to be the best course of action and within the capability of this team.

HOW DID WE GET HERE?....

I began this quest to improve the position of ‘Joe Homeowner’ within this tangled mess of electricity deregulation over four years ago.  Even today, I remain committed to advocate for all residential customers in Texas adversely affected. 

In March ‘07, I volunteered to serve for my community HOA (Homeowners Association) as a one-man electricity committee with a two-fold objective.  First mission was to convince the governing board to switch the commercial accounts of the development away from Reliant to one of the alternative REPs for substantial savings.  This mission was accomplished.  This project began my thirst for more knowledge.

Second goal was to explore the creation of an opt-in aggregation for the two thousand single family households in the community.  That project never really advanced due to non-support from the HOA and its management company for reasons not agreed with even today. 

Phase two of this endeavor began in September ‘09. At the urging of some friends and neighbors, the aggregation project was resurrected.  A committee of several volunteer residents was formed and work began with limited support from the HOA. The committee selected an energy consulting and aggregator partner after extensive study and consideration of the various options for moving forward.

That partner firm forwarded RFPs (Requests for Proposals) for building the aggregation to several REPs for competitive bidding.  The process concluded with the business being  awarded to one REP.  Sign-ups to the aggregation began 1 September 2010. Those sign-ups were terminated on 1 December after discovering the REP providing service had become non-competitive in the marketplace.

Incentives for joining the aggregation had vanished.  Thus, the aggregation effort failed and was abandoned.  Of special note here is the fact that PUC rules and regulations and the business models of the REPs make the formation of any residential aggregation impossible to achieve.

Our residential aggregation effort was not the first undertaken and to fail.  The treatment of residential customers individually and not collectively is the name of the game for the REPs.  The sign over the door reads no collective bargaining allowed. 

The online publication of this blog, which actually began over a year ago, and the conduct of the education and awareness campaign constitutes phase three.  It is now time to embark on phase four. 

THE ELECTRICITY GUY….

Friday, March 18, 2011

TXU, RELIANT AND OTHER REPS OPPOSE LEGISLATION TO HELP THE CONSUMER...

Jake Dyer, of TCAP, a good friend and partner to our endeavor, has just posted this message on the Recharge Texas blog:

"Think your retail electric providers are fighting for you at the Texas Capitol? Think again. In testimony this month before a key legislative committee, representatives for the state’s largest retail electric providers expressed support for removing information from home bills intended to help residential customers.

Under current law, REPs are required to print the following short message on all bills: “For more information about residential electric service please visit www.powertochoose.com.” Texans who visit that website will find information about the market, a sampling of electricity prices — even complaint information. But the requirement that REPs promote the powertochoose website expires in September.

And that’s how it should be, according to representatives for the Alliance for Retail Markets and the Association of Electric Companies of Texas. During a March 9 legislative hearing, both argued against House Bill 1374 that would require REPs to continue printing the public service announcements. “It is our opinion that REPs should no longer be required to reference the powertochose site on their bills,” said the ARM representative.

But state Rep. Dwayne Bohac, the Angleton lawmaker who crafted HB 1374, said competition benefits when customers have more information. “I believe in the free market,” said Bohac. “The more information we can put in a central location so people can shop around, the more efficient the market works and (that means) greater economic growth. I’m not scared of competition.”

The Texas Coalition for Affordable Power also supports House Bill 1374.

One of the REP groups that opposes the bill, the Alliance for Retail Markets, represents 15 companies in Texas. According to recent regulatory filings, members include Constellation NewEnergy, Inc; Direct Energy, LP; First Choice Power; Green Mountain Energy Company; Gexa Energy, LP; Integrys Energy Services of Texas, LP; Sempra Energy Solutions LLC; and Stream Energy. The Association of Electric Companies of Texas includes Reliant and TXU Energy, two of the state’s largest REPs."

Wednesday, March 16, 2011

STATE OF ILLINOIS IS DIFFERENT....

The state of Illinois was deregulated in a far different fashion than Texas with the passage of their new law in 1997. The law provided a phased-in approach to competition by lowering and capping rates immediately for residential customers.

Large industrial customers were able to begin receiving their electric supply from competitive suppliers beginning in late 1999. The ability to use a competitive supplier was offered to other industrial and large commercial customers over the next few years with all customers, including residential customers, able to use competitive suppliers beginning in 2002.

While Illinois customers have had the ability to purchase their electricity competitively, many had not due to the imposition of stranded costs along with the capped prices offered by the legacy utilities.  As of January 2, 2007, these and other barriers were removed.  Those caps remained in force for 10 years.  While the caps were in place it was not lucrative for alternative REPs to participate.  Residential customers only began, in actuality, to be serviced by alternative providers May last year.

Many new retail providers are now entering that states market due to a decision made in December by the ICC that makes it easier for alternative providers to bill for their services through the legacy or incumbent utility company and a rule change dealing with the purchase of receivables with consolidated billing.  Prior to this, introduction of retail competition for residential customers was somehow hindered.

The Citizens Utility Board, a strong consumer advocacy organization created by the Illinois General Assembly in 1983, has just published a fact sheet explaining the current situation.  Click here to read the fact sheetNote the rates being paid and the few number of REPs for the one major service area.

You may also want to visit the state of Illinois' counterparts to our PUC and Power To Choose websites. Click on their links.

ILLINOIS PUBLIC PUSHES BACK ON COM-ED'S RATE HIKE, SURCHARGE PROPOSAL....


(AS IT GOES IN ANOTHER DEREGULATED STATE - COMPARE TO RATE HIKES HERE IN TEXAS FOR ONCOR AND CENTERPOINT)

Commonwealth Edison, a legacy utility in Illinois, faced a tough hearing recently regarding its proposal for a $326 million rate hike that would add $5 a month to an average customer's electricity bill.

"When you have the economy as it is and these unemployed people, where's the money going to come from?" said James Kimbrough, an apartment building owner and Lansing resident who attended the public hearing.

Separately, ComEd also is asking the Illinois Commerce Commission (ICC) to allow it to add a surcharge to customer's bills to pay for such programs as low-income customer assistance, electric vehicle testing and, eventually, smart grid investments. So far, the programs it proposes to include under that surcharge amount to $195 million, or about an extra 25 cents a month for average consumers.

"By itself, it doesn't sound like a lot, but when you start adding it up — that surcharge doesn't include future investments in smart grid, which could increase that surcharge for consumers," said Scott Musser, associate state director for AARP Illinois.

The surcharge is one of several workarounds ComEd has sought in recent years to recoup capital expenses faster than going through the 11-month process normally used to determine rates.  Legislation that would overhaul the regulatory process and set rates by formula is making its way through Springfield.

Opponents called the request excessive, saying it unfairly burdens cash-strapped consumers to reward shareholders of Exelon Corp., ComEd's parent.

The cost of the electricity makes up about two-thirds of the average consumer's bill and is passed through without markup. The rate case, to be decided in May, applies to the amount ComEd charges for delivering power to homes.  ComEd is proposing that more costs be shifted to the charges on the delivery portion of the bill that don't vary based on electricity usage.

The result, said Karen L. Lusson, senior assistant attorney general, is that when customers try to conserve electricity to save money, they'll realize less savings than they would have previously."All users will have less of an ability to control their monthly ComEd bill," Lusson said.

NO FIREWORKS AT PUC-ERCOT SUNSET BILL HEARING....

One free market advocate says it goes too far, but consumer groups say it’s a step in the right direction. Texas Coalition for Affordable Power President, Jay Doegey, told members of the House State Affairs Committee Monday that Texas cities wholeheartedly support calls for more oversight over the financial management of ERCOT (Electric Reliability Council of Texas).  “We believe the PUC needs to have the tools available to make sure rates remain reasonable,” Doegey said, testifying in favor of House Bill 2134 by State Rep. Burt Solomons (R-Carrollton). (Courtesy TCAP)

TEXAS ELECTRIC COMPANIES DEFEND RIP-OFF....

House Bill 2133, designed to help electric competition and consumers, draws industry fire at a recent hearing in Austin.  Here’s a simple idea: if you get busted for fraud, you shouldn’t be allowed to keep the money except, apparently, is not so if you are a part of the Texas electric industry.  The industry representatives and their lobbyists attending the hearing offered the flimsiest of rationale for the actions of the offender operating in the wholesale side of the house.  READ THE STORY HERE.

Courtesy Recharge Texas and TCAP

ELECTRICITY GUY'S RECENT SELECTION OF A NEW REP....

Electricity Guy made yet another switch effective 1 March.  My choice was Amigo Energy's 6 month fixed plan at 8.2 cents per kWh for 1000 kWhs usage.  The plan remains available today.

The Facts Label (EFL) stipulated the average rate to be 8.5 for 500 and 8.0 for 2000 kWhs.  This tiering was considered least harmful.  A $6.95 monthly service charge assessed for any month with usage below 500 kWhs accounts for the 8.5 rate.  I usually experience two months at that usage level.

The plan requires online sign-up, electronic billing and auto-pay.  At the time of sign-up, this was low market for the 6 month plan for my service area.  I advocate buying lowest cost and choosing the right terms.

These disclosures are a part of the new policy of this blog to name names. 

Saturday, March 12, 2011

PUBLIC CITIZEN'S VIEW ON HIGH OIL AND GAS PRICES....

Don’t Let High Oil Prices Fool You – More U.S. Drilling Is Not the Answer

Statement of Tyson Slocum, Director, Public Citizen’s Energy Program

With oil prices briefly topping $100 per barrel, some are dusting off the tired “drill baby drill” playbook and calling for an expansion of domestic oil and gas drilling – ignoring the point that opening up access to the Pacific, Atlantic and eastern Gulf regions, which are currently off-limits to drilling, would not have a significant impact on domestic crude oil and natural gas production or prices before 2030.  MORE >>

Friday, March 11, 2011

GOP BILL TO RETALIATE AGAINST UTILITIES....

GOP lawmakers and industry lobbyists in Washington are talking about legislation aimed at reining in power companies after some utilities were seen as being less than friendly to their efforts to block Obama administration climate change rules. Several House Energy and Commerce Committee Republicans and industry lobbyists are pushing for a “Ratepayer Protection Act,” a measure that would limit utilities’ ability to pass along costs to consumers, according to lobbyists close to the committee.  More >>

GOOD OR BAD.  Provide your comments.

CEO OF BIGGEST U.S. NUCLEAR-POWER PRODUCER TOUTS "CHEAP" NATURAL GAS AS ENERGY SOLUTION....

The U.S. should use more natural gas to generate electricity and shun new “clean-energy” subsidies given for nuclear reactors, wind turbines, solar panels and coal-fired plants that capture carbon dioxide, Exelon Corp. CEO John Rowe said in prepared remarks for a speech recently, according to a Bloomberg News report. 

Higher U.S. production of natural gas “has already jump-started the transition to clean energy” and there is “no need for expensive mandates and subsidies” to support other technologies, Rowe said in remarks for a talk at the American Enterprise Institute in Washington, D.C.

PROVIDE YOUR OWN COMMENTS ON THIS  IMPORTANT SUBJECT OF SUBSIDIES. 

STATE REP. SYLVESTER TURNER ANGERED BY CHANGES IN SYSTEM BENEFIT FUND

Houston Democrat gets emotional at Appropriations hearing.

A proposal to further curtail how much money is paid from an account funded by electric ratepayers for a program to assist at-risk Texans with their utility bills led to an emotion-packed speech by state Rep. Sylvester Turner during a recent House Appropriations Committee hearing.

To learn more about the System Benefit Fund CLICK HERE.

A FEAR OF FRACKING MAY SLOW NATURAL GAS TREND....

Natural gas could be a major source of low-cost electricity nationwide, as an upsurge in domestic production drives costs down and looming environmental mandates encourage utilities to retire power plants that run on dirtier-burning coal. But energy experts and executives at the CERAWeek conference in Houston on Wednesday described a landscape of obstacles still standing in the way of natural gas producers. Chief among them: public fears about water contamination from the hydraulic fracturing process that is essential to unlocking natural gas in U.S. shale formations.

Story courtesy The Texas Energy Report and the Houston Chronicle

SUNSET BILL GIVES PUC MORE OVERSIGHT OF ERCOT....

Solomons' measure also tougher on market manipulation.

The Public Utility Commission would have the authority to approve or change the annual budget of the Electric Reliability Council of Texas and fines would quadruple for any company found to have manipulated the electric market for its own gain under the Sunset bill that will be heard in committee on Monday.

State Rep. Burt SolomonsHouse Bill 2134 largely tracks the recommendations approved in January by the Sunset Advisory Commission and includes language that the Carrollton Republican has been advocating for at least two years to cut the number of ERCOT board members who have ties to the electric industry.

Solomons was closely involved with matters relating to the PUC and ERCOT dating back to the 2009 legislative session when he chaired the House State Affairs Committee. This session, he traded the State Affairs gavel for the chairmanship of the Redistricting Committee, but he remains a senior member of the panel that oversees electric issues.

COURTESY THE TEXAS ENERGY REPORT: BUZZ

Thursday, March 10, 2011

REP FAILURES LIKELY OVER, SAYS ELECTRIC UTILITY REGULATOR....

It’s unlikely any more electric retailers will go out of business because of the Feb. 2 power emergency that created spikes in wholesale power prices, said Texas Public Utility Commission Chairman Barry Smitherman.  READ MORE >>

IT IS TIME TO ACT - MOVE OUT SMARTLY....

In the recent days two new bills designed to restore sanity and fairness to our electricity marketplace have been filed in both houses of the Texas Legislature.  They are Senate Bill 948 and House Bill 2222.

Legislators sponsoring these initiatives are to be applauded.  Ordinary citizens of this fine state must now muster behind this new effort to correct the wrongs resulting from deregulation.  The time has come to reject status quo and do what is right and certainly warranted.  We can end the manipulation of our electricity accounts by the industry.

Use the links provided to review the text of each of the bills and their status in the legislative process.  The changes to the rules being proposed are easy reading and self-explanatory. 

We have seen in the news of late that ordinary citizens....the people....can rebel against the Republican, big business, conservative way of doing business and have their voices heard.  Such a movement is needed here to return proper business ethics, fairness, and value to the consumer.

Answer the call to duty.  Join the ranks of those that want and need change.  Follow your self-interests and be guided by your stirred emotions.  Pain at the pump directly relates to pain at the meter.

Tuesday, March 8, 2011

LATEST SHORT-TERM FORECASTS FOR NATIONWIDE ELECTRICITY PRICES...

U.S. Electricity Retail Prices.  During 2010, retail prices for electricity distributed to the residential sector averaged 11.58 cents per kWh, about the same level as in 2009.  EIA expects residential prices to rise by 1.0 percent in 2011, followed by an increase of 0.5 percent in 2012 (U.S. Residential Electricity Prices Chart). 

The effect of lower generation fuel costs in 2011 should be more evident in retail prices for electricity distributed to the industrial sector, which EIA projects will fall 1.6 percent during 2011 and then rise 0.2 percent next year. 
 

Monday, March 7, 2011

DO'S AND DON'TS....

DO’S
  • Plan ahead of your current electricity account contract expiration date.  Review your usage for the past twelve months.  Do the homework and do the math.
  • Search the market offerings using Power to Choose.  Seek out the lowest cost rate plans while considering the hidden fees and misleading sales and marketing tactics.  Work through the confusion that is ever present and rampant.  Follow the extensive guidance provided in this blog and other sites named in the links section.in the right panel.
  • Take full charge of and better manage your electricity account.  Save money and help your household budget.  Exercise your right of choice of provider.  Reject status quo.
  • Follow this blog to stay abreast of the latest news, legislative and regulatory actions and other developments.  Become better informed and smarter.
  • Engage in the discourse underway.  Inject your own comments, ideas and opinions.  Spread the word to your friends, neighbors and family members.  Render special help to those not online.
  • Finally, end complacency, skepticism and even cynicism regarding the whole issue of electricity deregulation facing the homeowners of this fine state. Help fix this mess.

DON’TS
  • Don’t allow your electricity account to be manipulated by others.
  • Don’t fall victim to the unfair practices of so many of the REPs seeking your business.  The schemes being used are not that difficult to identify.

QUESTION: WHICH LAWMAKERS REPRESENT ME?....

To learn the names and contact information of the state and national legislators that represent your district CLICK HERE.

WHAT IS A DEFAULT RENEWAL CONTRACT?....

For fixed term contracts, REPs are required to send their customers notices of contract expiration at least 14 days prior to the end of the initial contract term.  If the customer fails to renew with that provider or switch to another REP, normally, service will automatically continue on a month-to-month basis after the expiration of the initial contract on what is called the DEFAULT RENEWAL PRODUCT which is a variable price product whose price will be determined by current market conditions until either canceled by the customer or the REP.

Saturday, March 5, 2011

ELECTRICITY PRICE TIERS WILL NOT INCREASE COST....

Average customers will see little change in their power bills, an analysis reveals.  Under the new three-tier system for "non-fuel" charges, customers who use more electricity pay a higher rate than those who use less.

This is all happening in Hawaii, but could it have application here in Texas.  READ MORE >>

CALIFORNIA GOVERNOR MAKES CHANGES AT UTILITY COMMISSION....

California Gov. Jerry Brown has appointed a consumer advocate and a law professor to the state's utilities commission in two of three closely watched appointments that could affect utilities and other companies regulated by the state.

The governor appointed to the California Public Utilities Commission Mike Florio, a long-time senior attorney for consumer advocate The Utility Reform Network and a former board member of the state's grid operator, the California Independent System Operator; and Catherine Sandoval, an associate professor at the Santa Clara University School of Law.   MORE >>

LEGISLATION SEEKS TO OPEN UP AUSTIN ENERGY TO COMPETITION ....

State lawmakers have filed legislation that would end Austin Energy's state-sanctioned monopoly. Companion bills in the state House and Senate would allow competing electric providers to operate within Austin Energy's service area, enabling them to potentially lure away some of the city-owned utility's roughly 400,000 customers. 

The legislation has not generated much attention and is a long shot to pass. Members of Austin's state delegation oppose it, and city officials say it could undercut the finances of Austin Energy and the city government. MORE > >

RECORD U.S. NATURAL-GAS OUTPUT LIKELY TO CONTINUE IN 2011 ....

The U.S. is inundated in natural gas, and the glut may not ease any time soon. Domestic production last year hit its highest level in almost 40 years, and 2011 will likely see another year of strong production.  That means another year of subdued electricity prices and pressure on drillers' bottom lines as well as a powerful incentive for companies and other consumers to switch to the heating fuel.  This report courtesy the WSJ and The Texas Report.

TEXAS CONSUMER ASSOCIATION NEW LEGISLATION RECOMMENDATIONS....

The Texas Consumer Association continually posts and updates its legislative recommendations for the competitive electricity market on their website.  In my opinion, the association should conduct far greater in- depth studies of the unfair practices followed by the majority of the REPs and move swiftly to persuade our lawmakers to enact reforms.  READ THE CURRENT TCA RECOMMENDATIONS HERE 

MAYBE YOU DON’T KNOW….

Rule changes made some time ago by the PUC due to the failures of some REPs in ’08 include the following measures:
  • The Commission adopted stronger technical and managerial standards for REPs.
  • REPs must now meet higher standards for capitalization and risk management.
  • REPS entering the market must post a $500,000 letter of credit that may be used to pay the deposits of low-income customers if they are transferred to the POLR.
  • A new rule now forbids a person who had control of a REP that transferred its customers to a POLR from owning or controlling a REP thereafter.
  • The notice provided customers by ERCOT when they are transferred to a POLR was strengthened.
  • More time is now given for the transferred customers to pay deposits to the POLR and more financial assistance was added for the low-income customers.

Thursday, March 3, 2011

RECORD GLOBAL FOOD PRICES....

Global food prices have hit record highs, and could rise even further, according to the United Nations.  Report just released today. The UN's Food Price Index rose 2.2% in February to the highest level since the UN's Food and Agriculture Organization (FAO) began monitoring prices in 1990.  It also warned that spikes in the oil price could make the "already precarious" situation in the food market even worse.

THIS DEVELOPMENT WILL PUT MORE PRESSURES ON HOUSEHOLD BUDGETS AND AGAIN REINFORCE THE NEED TO PAY LESS FOR ELECTRICITY.  People....wake up.  Rejoin the real world.  Participate in this conversation.

ELECTRICITY AND GAS PRICES DOWN - BUT NOT IS TEXAS...

Customers in Calgary, Canada not locked into long-term energy contracts can look forward to bigger savings in March as longer, warmer days -and abundant natural gas supply -lead to lower REGULATED rates on electricity and natural gas.

Enmax Corp. dropped its March regulated rate option on electricity by 20 per cent Monday, to 7.356 cents per killowatt-hour.

For natural gas, meanwhile, soft prices continue to pull down prices, with Direct Energy's regulated rate dropping 27 per cent to $3.071 per gigajoule.

Story courtesy the Calgary Herald.

FOLLOW-UP TO PREVIOUS POSTING ON TCAP REPORT....

Excessive electricity prices under electric deregulation have cost Texans an additional $15.5 billion, according to a new report on the deregulated market.  THIS IS A MUST READ.  CLICK HERE. 

FILING A COMPLAINT WITH THE PUC....

The Customer Protection Division of the PUCT provides for the submission of complaints to their office using this resource.  CLICK HERE.

ENERGY INDUSTRY VETERANS FORM POLICY INSTITUTE BASED AT UT-DALLAS....

Three Texas energy insiders have formed a new policy institute designed to offer independent advice based on the state’s electricity experiments.

Monty Humble, a lobbyist who pushed T. Boone Pickens’ energy plan in Washington, and Mark Armentrout, former chairman of ERCOT, will lead the Center for Energy Policy and Markets.

The center is part of the Texas Institute, a young research institute created by Jonathan Shapiro to bring together experts from North Texas universities to work on energy problems.

The policy group, located at the University of Texas at Dallas, will seek to educate lawmakers and the public about energy.

A BULB REVOLUTION: LIGHTING EXPERTS MUST DEVELOP INNOVATIVE LUMINATION....

For an interesting and informative presentation on new technologies and mandates for suitable household lighting, visit this posting on the Houston Chronicle energy blog.

FuelFix.com is your daily must-read source for news and analysis on the energy business. Anchored by business reporters at the Houston Chronicle and other Hearst newspapers, FuelFix incorporates blogs by energy experts, market updates, useful data and a real-time summary of the top ideas, hottest stories and latest news.

WHY WERE ELECTRICITY PRICES RISING WHILE NATURAL GAS IS FALLING?....

While doing my homework last week for the recent switch of providers, I noted several REPs had raised their prices two to four mils (tenths of a cent) during the week.  Were their actions justified?  Natural gas prices were falling to $3.83 during the same period.  Did wholesale costs of electricity increase or did the REPs again profit on the fears of some due to events in Libya and the rise in oil and gasoline prices?  PROVIDE YOUR COMMENTS.

HOUSTON CHANNEL 11 NEWS STORY ON NATURAL GAS PRICES....

Title for the story reads "Why the state thinks Houstonians pay too little for natural gas".  Opening statement reports the big utility company, CenterPoint, selling natural gas to Houston residents is shifting costs from industrial and commercial customers to residential customers.  It further states "Fees on your gas bill, including "customer charges", are set by the Railroad Commission of Texas, which critics claim largely favors big companies over little consumers".  CLICK HERE TO READ FULL STORY

SAN ANTONIO RESIDENTS PAYING LESS FOR POWER DESPITE LACK OF COMPETITION....

The Texas Coalition for Affordable Power released a report recently that shows that in regions of the state where consumers have the right to choose their power suppliers, those ratepayers are paying more for electricity, while markets like San Antonio and Austin, where that option is not available, are paying less.

Wednesday, March 2, 2011

ELECTRICITY DEREGULATION WARFARE….

Yes, many could classify the roles occupied by the energy industry and its supporters versus the consumer as warfare.  The views and interests of both parties directly oppose each other.  Profit motivates the industry and fairness should be the regulator’s and consumer’s guiding principle.

Senate Bill 7, signed into law in ‘99 by former Governor George Bush, began this war.  Industry has captured the hill with overwhelming force, but it is not time to surrender.  The consumer must counterattack.

As stated in an earlier posting, balance is needed in the battle being fought.  Too much power exists with the industry.  We consumers need more soldiers and ammunition.  Therefore, the duty undertaken by this Blog to recruit followers to its mission and goal is worthy and deserving of support.

SB7 ordered the restructuring of the electric utility industry in Texas to provide retail competition and customer choice beginning 1 January, 2002.  The Public Utility Commission was made responsible for implementation by the Public Utility Regulatory Act of 2001.

Among the statutes governing the operations of the PUC is Chapter 25 - Substantive Rules Applicable to Electric Service Providers.  Use the link provided to review the extensive rules.  This rule book is what we are fighting to reform to bring more fairness to the market as mandated by the law.

A REHASH OF NEW CONSUMER FRIENDLY RULES....

Fairly early last year, the PUC adopted rule amendments to facilitate more rapid transfers from one REP to another when a customer decides to switch REPs. Under previous rules, switching REPs could take as long as 45 calendar days, but the amendments now shorten that time to seven business days or less.

Also, TDUs must now process meter reads for customers who are switching REPs within four business days of receiving a request from the gaining provider. Additionally, REPs are now required to notify customers of the termination of a term contract for electric service at least 14 days before the termination date.

The combination of notifying the customer of pending contract term expiration and providing for a significantly shortened process for changing REPs has improved customers’ ability to make timely choices, thus making the competitive electricity market more responsive to the needs of retail electric customers.

WE NEED MORE RULE CHANGES SUCH AS THESE.  BECOME ENGAGED TO HELP THAT HAPPEN.

NEW FEES ON RESIDENTIAL ELECTRIC BILLS COMPLICATE COST COMPARISONS ....

See complete report filed recently by Carol Biedrzycki, Executive Director Texas Ratepayers’ Organization to Save Energy (TEXAS ROSE).    CLICK HERE

NEW LEGISLATION FILED TO HELP ELECTRIC CONSUMERS....

State Senator Wendy Davis from Ft Worth has introduced two new bills pertaining to the electricity retail market that she says will help ratepayers.  One of these bills calls for a new standardized rate plan product with set terms to be created for the market.  Follow the progress of these bills to learn if they are to be considered during this legislative session.  LEARN MORE BY CLICKING ON THE LINKS BELOW.

SB948

MARKET SHARE REMAINS AN IMPORTANT KEYWORD...

I last discussed this issue in a posting dated 12 October last year.  At that time, June data was used.  I can now report official, non-confidential, September numbers and, little change has occurred.  This is not good.

In the Oncor and CenterPoint service areas, a majority or near majority percentage of customers in the residential sector are still retained by the affiliated or old legacy companies.  The numbers are 53.77 and 45.20 respectively.  The numbers range from 30.40 to 34.76 for the other three service areas.  I ask, what is bad here?

Here is the answer.  This condition directly contributes to the lack of a flourishing competitive marketplace.    We still partly have the situation created by the expired 'Price to Beat' provision of the restructuring law that we all lived with from '02 to '07, when rates were artificially kept high.  We have only had a truly open market since 1 January 2007.  Market share does matter. 

Until TXU, Reliant and the other incumbents lose more of their customer base, rates will likely remain higher than they need to be.  The principle is basic.  Folks you need to end the stubbornness.... just don't care attitude, or its too much trouble mentality.  It's wrong  and irresponsible.  More of you need to switch to one of the alternative providers.  Again, this is straight talk.