Prices go up and prices go down, but under the state”s flawed deregulation law, one fact of life appears to have remained constant: Texans pay too much.
Consider that customers in TXU”s service territory pay more today than they would have paid in March of 2000, which was prior to deregulation, but when the price of natural gas was slightly higher. Even customers on the least expensive rate plan in North Texas still pay more today than they would have paid before deregulation, according to publicly available data.
Check out the math yourself. According to data from the Public Utility Commission, TXU customers in March 2000 paid 7.326 cents per kw/h. That”s for household use of 1,000 kw/h each month. A quick look at the www.powertochoose.com website indicates that the lowest available price in the same service territory on Sept. 4, 2009 is 8.9 cents per kw/h. The average of offered rates on the same day is 10.9 cents. You can check out a spread sheet showing the Sept. 4 numbers by clicking here.
These numbers show that the lowest rate available today is still 21.5 percent HIGHER than the last regulated rate at a time when natural gas prices were similar. (Natural gas is used to fuel many power plants and is linked to electricity costs.) More shocking still: the average of offers under deregulation in what was TXU”s service territory is 48.8 percent HIGHER than it was under regulation. Either way, the deregulated prices don”t measure up.
But perhaps that is not so surprising, given that electricity rates in Texas remained below the national average for many years prior to the Texas deregulation law, but have remained consistently above the national average after deregulation.
Is a policy analyst consultant for TCAP, a coalition of political subdivisions in Texas that purchase electricity in the deregulated market for their own governmental use. Because energy costs are typically a significant budget item to our members, TCAP is consistently looking for ways to save our members money, through cost-saving contracts, energy efficiency or demand response programs.