Have you checked your electric bill recently?

[BryanS]

Apologies if this has been discussed before on HAIF... but...

Outrageous rates.

Commerce Energy is charging 22.2 cents per kWh. Reliant Energy is 14.5. Simple Power is only 12.7, but it is a "promo" offer only and increases to their super low consumer friendly rate of 16.5 for a full 12 months!

All the while consumers in the regulated market of San Antonio are paying only 6.1 cents per kWh, almost 4 times less than Commerce Energy. A consumer in San Antonio pays $61 for 1000 kWh while those in Houston pay $222.00. <- We are getting screwed! - and not in the good way!

From your favorite, recently suspended partisian NASA blogger.

Link to the KHOU story, here.

That means electricity in Houston is 38 percent more expensive. Consumer advocates call the difference startling.

~~~~~~~~~~~~~~~~~~~~~~~

We need re-REGULATION, by government. Someone please tell me why we thought de-regulation of our electric utilities was a good idea. There are many things that the public needs that should never be exposed to the "free market." Medicine. Food. Electricity. Natural gas - and even oil.

[RedScare]

"WE" did not think deregulation was a good idea. The big players saw the same opportunity to make gargantuan profits at the public's expense in electricity as they had in credit cards, banking, and all the other "free markets". After throwing obscene amounts of money at Texas legislators, and a tried and true anti-government, pro-business campaign that always seduces Republican voters, deregulation of the electricity markets came true, even as California's experience with it was showing big problems.

I don't know if the genie can be put back into the bottle, but frankly, I don't know if conservative Texans are quite ready to admit that they've been hoodwinked by the GOP. Maybe this thread will give us an idea.

[crunchtastic]

The thing that is most infuriating is the lack of actual competition for product. It's the same product, delivered by the same infrastructure, and serviced by the same people who've always owned that infrastructure.

Having moved back to Houston after enjoying municipal electric in San Antonio for many years, and having exhausted myself attempting to be an educated consumer, shopping for the best deal allegedly afforded me by deregulation, I've come to the conclusion that I'm getting royally screwed. All the free marketeers who claim that the government is big and bloated and incapable of owning and running utilities efficiently, please show me how I'm getting a better deal here than I was in San Antonio with the socialist City Public Service. Show me where the increased choice and competition is, because I'm having trouble finding it. Show me the numbers that prove utility deregulation created jobs and economic growth that mitigates my doubled monthly bill.

This is what we should be asking the next gubernatorial candidates. I would like to see the Dem candidate press the issue. We'll see. Sadly, I think most people would rather vote against their own economic self interest than support the idea of state-owned utilities, or price regulations. Better to be proud economic roadkill than be lableled a socialist-- at least that's what the Texas GOP would have us believe when it comes to deregulation.

[memebag]

Amen, crunch. I love free markets, but they don't work everywhere. Specifically, they don't work well for shared infrastructure. Maximizing profit from public utilities prevents us from maximizing profit in services that rely on those utilities.

[MidtownCoog]

"WE" did not think deregulation was a good idea. The big players saw the same opportunity to make gargantuan profits at the public's expense in electricity as they had in credit cards, banking, and all the other "free markets". After throwing obscene amounts of money at Texas legislators, and a tried and true anti-government, pro-business campaign that always seduces Republican voters, deregulation of the electricity markets came true, even as California's experience with it was showing big problems.

I don't know if the genie can be put back into the bottle, but frankly, I don't know if conservative Texans are quite ready to admit that they've been hoodwinked by the GOP. Maybe this thread will give us an idea.

GOP?

Try ERCOT.

[Pumapayam]

I am locked in at 12.1 cents/KWH until 2/09 while my partner just renewed his rate this week until 5/10 for 15.2 cents/KHW.

When I bought my home in 2/03 the going rate was 7.9 cents/KWH.

[houstonmacbro]

We're at 10.9 I believe. I am with Ambit.

[Pumapayam]

We're at 10.9 I believe. I am with Ambit.

How long are you locked in for. I was smart with my timing as I did not want to lock in during the peak summer months, usually the high rate time in Houston.

February is a decent heating month, but the rates are usually at their lowest and well ahead of the general price hike that happens in the spring.

[houstonmacbro]

How long are you locked in for. I was smart with my timing as I did not want to lock in during the peak summer months, usually the high rate time in Houston.

February is a decent heating month, but the rates are usually at their lowest and well ahead of the general price hike that happens in the spring.

10.9 for 1 year. I should have signed on for 2-3 years but I wasn't really thinking. My current rates expire in November.

[BryanS]

How long are you locked in for. I was smart with my timing as I did not want to lock in during the peak summer months, usually the high rate time in Houston.

February is a decent heating month, but the rates are usually at their lowest and well ahead of the general price hike that happens in the spring.

Isn't this whole idea of "locking in a rate" stupid? I mean - this isn't cell phone service or a mortgage. There is only ONE SET of power lines/power infrastructure - yet everyone can have varying electric bills, neighbor by neighbor. That's just nuts to me.

[houstonmacbro]

Isn't this whole idea of "locking in a rate" stupid? I mean - this isn't cell phone service or a mortgage. There is only ONE SET of power lines/power infrastructure - yet everyone can have varying electric bills, neighbor by neighbor. That's just nuts to me.

That's deregulation for ya.

I could be paying 5-10 cents less per kwh than my neighbor.

... or more.

[Pumapayam]

Isn't this whole idea of "locking in a rate" stupid? I mean - this isn't cell phone service or a mortgage. There is only ONE SET of power lines/power infrastructure - yet everyone can have varying electric bills, neighbor by neighbor. That's just nuts to me.

Prices are only going up, if I can lock in next year for 15 cents/KWH or less, I am going to do it for 3 or 4 years if I can.

[crunchtastic]

Isn't this whole idea of "locking in a rate" stupid? I mean - this isn't cell phone service or a mortgage. There is only ONE SET of power lines/power infrastructure - yet everyone can have varying electric bills, neighbor by neighbor. That's just nuts to me.

Just wait: water is next.

[tanith27]

I'm with Gexa. Called them because I was upset at the 14 cents they had me on and simply requested if they had a lower rate. Not sure what they did, but I've enjoyed my last two bills at 9.6c/kwh.

[Pumapayam]

I'm with Gexa. Called them because I was upset at the 14 cents they had me on and simply requested if they had a lower rate. Not sure what they did, but I've enjoyed my last two bills at 9.6c/kwh.

Funny, just like mobile carriers, if you complain, they will try to retain your business by offering you a "retention" plan. Nice score.

[cottonmather0]

Wow, regulating utilities will cause the price of natural gas to go down and cause power plant efficiencies to improve? I had no idea that the power of government was so great. Let's regulate everything!

[crunchtastic]

Wow, regulating utilities will cause the price of natural gas to go down and cause power plant efficiencies to improve? I had no idea that the power of government was so great. Let's regulate everything!

As I said: show me the numbers. Show me the increased competition that betters the marketplace. Show me the increased efficiency. Show me the job and growth data that supports third-party salesmen marking up the same product delivered by the same infrastructure. Hell, show me a more easily understandable billing statement. I'm still waiting.

Can't? Because dollar for dollar, you pay more for electric now than you did (inflation adjusted) before deregulation.

No one in this thread said price increases aren't part of the game, or that price regulation means capped price controls, or that a municipal or state provider shouldn't be able to account for the cost of doing business. You can talk the party line all you want. I'll listen when you show me the numbers that say electricity deregulation in Texas has had a noticeable and positive economic impact that didn't exist before.

[RedScare]

Wow, regulating utilities will cause the price of natural gas to go down and cause power plant efficiencies to improve? I had no idea that the power of government was so great. Let's regulate everything!

You really gotta be enjoying that kool-aid to stick up for deregulation of utilities in the face of the rampant inflation of utility rates. Only my municipally owned and regulated water bill has remained relatively affordable. The rest of my utilties have gone up over 50% in the last 4 years, from well under $200 to well over $300 a month. All this, just so that I can brag that I am a free marketeer? No thanks.

[Subdude]

The point isn't that regulation is in itself inherently either good or bad. The problem is that people have become too used to thinking in black & white terms that all regulation must be evil.

It depends on execution and the specifics of the market. That said, it has frequently - but not always - been the case that de-regulated electricity markets have led to higher consumer prices with little appreciable benefit. Texas is a casebook example of poorly executed deregulation. On the other hand, I would say deregulation in the UK market has done an excellent job of holding down end-user prices. The competition there is brutal.

[BryanS]

Wow, regulating utilities will cause the price of natural gas to go down and cause power plant efficiencies to improve? I had no idea that the power of government was so great. Let's regulate everything!

Commodities (electricity, water, food, medicine) need to be regulated as these are certain goods and services that everyone needs - to live. Only those with a commercial interest, or direct consumer of, these commodities should be allowed to legally purchase them (no "buying or trading" energy, cattle futures, pork bellies, oil, wheat, rice ala Enron, no shell games with multiple electric providers - using one public, power system, etc.)

Are you actually happier now paying up to 38% more for your electricity? How much more are you paying now, than before? Please show us hard figures that prove we're better off now than before.

[CDeb]

Commodities (electricity, water, food, medicine) need to be regulated as these are certain goods and services that everyone needs - to live.

But by not allowing the market to work to some extent (i.e. rising prices when increased demand lowers supply), don't we expose ourselves to disastrous shortages (which would be much worse than elevated prices) when usage continues as if the commodity was not scarce?

Are you actually happier now paying up to 38% more for your electricity?

How much of that is due to de-regulation? Can the rising cost of energy in general not have something to do with it? That's an honest question. I'm not very familiar with this issue.

When I lived in Lafayette, we had a municipal utility that had some of the lowest prices in the country but our rates rose with the rising cost of natural gas, even though we were mostly supplied by coal fired plants.

[memebag]

But by not allowing the market to work to some extent (i.e. rising prices when increased demand lowers supply), don't we expose ourselves to disastrous shortages (which would be much worse than elevated prices) when usage continues as if the commodity was not scarce?

Did we have disastrous electricity shortages before deregulation? I don't recall any. I do recall disastrous shortages when California deregulated and Enron traders drove up the price by calling power plants and telling them to shut down.

A publicly owned utility can raise rates when the cost of production rises, but it can't raise rates just to show more profit.

[CDeb]

Did we have disastrous electricity shortages before deregulation?

I never said we did. I asked if we exposed ourselves to them. And not having them in the past isn't a great indicator of future risk in a completely different energy production environment. I'm merely raising a point for discussion, not promoting doomsday scenarios if utilities are re-regulated.

A publicly owned utility can raise rates when the cost of production rises, but it can't raise rates just to show more profit.

That's all well and good.

But BryanS started this thread complaining about the rise in prices and then stated that energy was a NEEDED commodity, thus implying that the price should be kept low, even artificially so, through regulation. I apologize if I am misrepresenting his intent.

[memebag]

I never said we did. I asked if we exposed ourselves to them. And not having them in the past isn't a great indicator of future risk in a completely different energy production environment. I'm merely raising a point for discussion, not promoting doomsday scenarios if utilities are re-regulated.

And I was just discussing the point.

But BryanS started this thread complaining about the rise in prices and then stated that energy was a NEEDED commodity, thus implying that the price should be kept low, even artificially so, through regulation. I apologize if I am misrepresenting his intent.

I haven't seen BryanS say anything about keeping the price "artificially" low. Public ownership of a utility doesn't imply that.

[CDeb]

Public ownership of a utility doesn't imply that.

No, but stating that something is "needed to live" does, IMO. Again, if I am misunderstaing his intent, I apologize.

[cottonmather0]

How is it that people seem to understand that the price of the gasoline consumed in an automobile is based on the underlying price of a barrel of crude oil, yet they can't make the same connection that the price of a KWh of electricity is also based on the underlying cost of the fuel that goes into a power plant? Then again, I know people who blame the gas stations for the price of the gasoline, so it's consistent that they would blame their power company for the price of their electricity.

It's an ironic coincidence (and quite beneficial to the anti-capitalists out there) that the price of natural gas and other commodities began to rise rapidly just as states across the country deregulated their electric utilities. The price would have gone up just as much with regulation as without because the efficiency of the generating facilities themselves has not changed but the cost of the fuel has.

With regards to San Antonio (and Austin, too, for that matter), CPS Energy is not a "regulated utility" per se, it's a municipally owned utility, that, for the most part, is reliant on very old (ie already paid for) generating stations and receives a predominant amount of the power that it sells from coal. They sell the power just above cost and you'll be hard pressed to find anything about how profitable that company is because it doesn't have to be - it's subsidized by the tax base of the city. You'll see a whole lot about it's "revenues" but you'll see nothing about profits.

The point is, Houston could do that too, and yes, our electric rates would go down, but our city sales tax and property taxes would go way up to compensate for it.

Similarly, most of the generating capacity in Houston is natural gas fired, which is more expensive than coal. We have a small bit of coal, and a small piece of the STP, too, but for the most part Houston has to use gas because we already have air quality problems and more coal (like San Antonio) would make them worse.

So what would you regulate, exactly? Be specific. Is the wholesale price of power in Houston too high? How? Do you even know how the wholesale price of the nodal LMP is calculated for the Houston region? Is NRG adding too much to their fuel cost estimates? How do you know? Have you discussed your idea with ERCOT? Are Centerpoint's connection fees too high? Seriously, regulation might help, but we need to know just what exactly needs to be regulated? Do the politicians in Austin need to be setting fuel prices and heat rates? HL&P (when it existed) never had to generate power at a loss - they would go to Austin and ask for a rate increase and they would get it every time. Is that going to change now? The politicians in Austin will tell NRG and Calpine and Constellation and Suez and all the other generators to sell their power at a loss? They already sell their wholesale power at or near cost, anyway (I know because I used to dispatch power plants for a living for one of these companies). What about the retailers? Do you have a better idea for a cheaper marketing and billing infrastructure? Is that what needs to be regulated?

[memebag]

The point is, Houston could do that too, and yes, our electric rates would go down, but our city sales tax and property taxes would go way up to compensate for it.

Really? What percentage of CPS Energy's operating cost comes from property and sales tax?

[jm1fd]

[]

[crunchtastic]

With regards to San Antonio (and Austin, too, for that matter), CPS Energy is not a "regulated utility" per se, it's a municipally owned utility, that, for the most part, is reliant on very old (ie already paid for) generating stations and receives a predominant amount of the power that it sells from coal. They sell the power just above cost and you'll be hard pressed to find anything about how profitable that company is because it doesn't have to be - it's subsidized by the tax base of the city. You'll see a whole lot about it's "revenues" but you'll see nothing about profits.

The point is, Houston could do that too, and yes, our electric rates would go down, but our city sales tax and property taxes would go way up to compensate for it.

Yes, CPS is municipally owned. It works quite nicely, and I am a proponent of that model. And my sales and property taxes were not higher to compensate. My property taxes did not go to CPS's operating budget. Please explain how in Houston our taxes would go up to pay for a municipally-owned utiltiy. Maybe they would--but I don't understand the connection.

This isn't about coal or natural gas or prices going up. We understand inflation. It's about utility deregulation being sold to the consumers as a better alternative. We were told that deregulation is the engine of economic growth. Show me the growth. We were told dereg would bring fairness in pricing. Instead, I now pay more than double on an adjusted basis. Some people pay even more. I'm glad you are so committed to the deregulation cause. Me, I like paying a fair price for electricity. It is a failure of our state lege that I could pay a fair price in one city, but I can't in another.

[cottonmather0]

Me, I like paying a fair price for electricity.

Why do you think the price you pay now is not fair?

$13/mmbtu delivered ship channel natural gas x 9 mmbtu/MWh = $117 / MWh = 11.7c / KWh for the cost of electricity. Does it cost nothing to maintain the lines and pay the people who run the plants? 12c-14c seems to be the going rate for retail customers, which works out to be around 10% margin before operating expenses. Is that unfair?

You must think the price of natural gas is too high, which is a fair point, but how is that the fault of deregulation?

Seriously, what SPECIFICALLY would be regulated that would cause the price to go down? The state would tell generators to sell at a loss? They haven't done that before, so why would they do it now?