webdude Posted June 4, 2008 Share Posted June 4, 2008 So it was a lie when they say deregulation would bring down prices Link to comment Share on other sites More sharing options...
crunchtastic Posted June 4, 2008 Share Posted June 4, 2008 Why do you think the price you pay now is not fair? I think the title of the news Bryan linked in the original post sums it up: Houston Pays More For the Same Energy.That's pretty straightforwward, I believe. By virtue of moving 300 miles east, I now get to pay twice what I used to for the same product. I don't know how to specifically implement re-regulation, nor should I have to. Like Red said, I don't how the genie could get put back in the bottle--but I'm not alone in believing it ought to be. Link to comment Share on other sites More sharing options...
CDeb Posted June 4, 2008 Share Posted June 4, 2008 Houston Pays More For the Same Energy.But is it the same energy if one is produced primarily with coal and the other with natural gas? Link to comment Share on other sites More sharing options...
memebag Posted June 4, 2008 Share Posted June 4, 2008 Regulation isn't the solution. Municipal ownership is. We put the genie back in the bottle by replacing all of these private utility companies with a single public utility. Link to comment Share on other sites More sharing options...
BryanS Posted June 4, 2008 Author Share Posted June 4, 2008 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.That's not what I meant. What I am really after is protecting the true supply and demand dynamics from wild speculation and artificial market manipulation. We'll give you, an electric company, a fixed profit margin of 6 to 7% over the cost of the raw processing/raw intake of materials. And we'll also make it illegal for anyone other than an electric company (or other legitimate businesses that need coal) from buying the coal you need to make electricity.Coal-fired plants in San Antonio and Houston are probably paying the same for coal, and probably have pretty much the same in fixed expenses. But in Houston, our electric bill can be up to 40% more than San Antonio. The San Antonio plants are not operating at a loss. They are not in danger of going out of business. But there are controls in place in San Antonio, preventing the rape of consumers by their electric provider.EDIT: 6 to 7% may be too high, for all I know. I would say look at the historic margin. Then go to Austin if you need to change it. Link to comment Share on other sites More sharing options...
CDeb Posted June 4, 2008 Share Posted June 4, 2008 That's not what I meant...Thanks for the clarification. Makes more sense. Link to comment Share on other sites More sharing options...
RedScare Posted June 4, 2008 Share Posted June 4, 2008 EDIT: 6 to 7% may be too high, for all I know. I would say look at the historic margin. Then go to Austin if you need to change it.Historically, 6% is the profit that the regulators strived for. It was a very solid stock to own. Not sexy, just solid. It was favored by those who wanted stable income from stocks. In the 90s, the tech boom made the energy executives jealous, and they started pushing for deregulation.Prior to deregulation, Houston had some of the lowest electricity rates, around 7 or 8 cents per kWH. Now, we have some of the highest. It cannot all be blamed on natural gas either, as deregulation occurred in 2002, when natural gas was still cheap, and electricity prices shot up immediately. The current price runup will just make rates even higher.As for what SPECIFICALLY should be regulated? The system in place in 2001 was fine with me, and it seemed to work fine for decades. The current system does not produce income for maintaining transmission lines or put money in the pockets of those who actually build and maintain generating plants. It merely allows middlemen and resellers to bag a bunch of profit. These are people with no talent other than gaming deregulated systems. They are legalized thieves, and they bribe legislators to make their middleman status legal in industry after industry. They did it in long distance and telecom. Now, they are doing it in electricity. They portray it as honest and hardworking businessmen competing to lower prices, and it never happens....but we keep falling for the "free market" scam every time.Well, at least SOME of us do. Link to comment Share on other sites More sharing options...
crunchtastic Posted June 5, 2008 Share Posted June 5, 2008 The current system does not produce income for maintaining transmission lines or put money in the pockets of those who actually build and maintain generating plants. It merely allows middlemen and resellers to bag a bunch of profit. These are people with no talent other than gaming deregulated systems. They are legalized thieves, and they bribe legislators to make their middleman status legal in industry after industry.It just is unfathomable to me that people don't see it for what it is--which is just as Red lays it out. It's unfair to even call it 'business.' These middlemen were essentially handed an entire market on a silver platter and told they could have as much share as they could convince to sign on.And when the infrastructure is a crumbling mess, and the middlemen have taken their profits, I'm sure we can rely on our good ole' boy politicians to to full privatize the whole lot, thereby instantly tripling prices for the people who haven't already privately contracted for themselves. Public utility is the way to go. I've seen it work just fine. Link to comment Share on other sites More sharing options...
Montrose1100 Posted June 6, 2008 Share Posted June 6, 2008 To run an AC 24/7 (around 74 degrees) in the summer in Abilene, in a 3 bedroom, 2 story townhouse ranges anywhere from $51-$110 a month. (Depends on how many loads of laundry I do ) A one bedroom apartment in Spring, (76 degrees) that only ventilates the living room, bathroom, and bedroom, ranges from $100-$156 a month. Houston, your getting screwed! Link to comment Share on other sites More sharing options...
houstonmacbro Posted June 6, 2008 Share Posted June 6, 2008 To run an AC 24/7 (around 74 degrees) in the summer in Abilene, in a 3 bedroom, 2 story townhouse ranges anywhere from $51-$110 a month. (Depends on how many loads of laundry I do ) A one bedroom apartment in Spring, (76 degrees) that only ventilates the living room, bathroom, and bedroom, ranges from $100-$156 a month.Houston, your getting screwed! Tell us what you're paying per Kwh so that way we can compare how badly we're getting it. I'm currently paying 10.9/Kwh. What are you paying? Link to comment Share on other sites More sharing options...
Fringe Posted June 6, 2008 Share Posted June 6, 2008 Tell us what you're paying per Kwh so that way we can compare how badly we're getting it. I'm currently paying 10.9/Kwh. What are you paying?Your paying 10.9 Kwh? Hang on to that plan if you can. I was paying about the same but my provider was one of the ones that recently went under. Link to comment Share on other sites More sharing options...
houstonmacbro Posted June 6, 2008 Share Posted June 6, 2008 Your paying 10.9 Kwh? Hang on to that plan if you can. I was paying about the same but my provider was one of the ones that recently went under. Guess it was just to good to last. No rates available even close to that now. If you go to the powertochoose.org web site and type in an Abilene zip code you will find that they do indeed have lower rates that are offered by the exact same companies in my area. Wonder why?Yeah, through November. But I talked with my representative and he said they (Ambit) no longer offer any 12 month plans, but just month-to-month rates.Sux. Oh well ... Link to comment Share on other sites More sharing options...
HtownWxBoy Posted June 7, 2008 Share Posted June 7, 2008 Just got my latest electric bill from Reliant... it's up to around $165... that's for a three story town home with 3 people living inside. We have two A/Cs... one for 3rd floor and one for bottom two floors... usually have the bottom floors set at 76F to 78F... top floor around 74F when sleeping and anywhere from 77F to even OFF when not sleeping depending on if we are up there. My bill says I am paying 13.6 cents per kWh. Link to comment Share on other sites More sharing options...
Subdude Posted June 8, 2008 Share Posted June 8, 2008 It just is unfathomable to me that people don't see it for what it is--which is just as Red lays it out. It's unfair to even call it 'business.' These middlemen were essentially handed an entire market on a silver platter and told they could have as much share as they could convince to sign on.And when the infrastructure is a crumbling mess, and the middlemen have taken their profits, I'm sure we can rely on our good ole' boy politicians to to full privatize the whole lot, thereby instantly tripling prices for the people who haven't already privately contracted for themselves. Public utility is the way to go. I've seen it work just fine. You're not willing to pay more for deregulated electricity?! What are you, some kind of communist? Seriously, assessed by end consumer prices, deregulation has had at best a mixed track record. For whatever reason, many people assumed that deregulation would somehow automatically lead to lower prices (fuel cost increases aside). Electricity markets, like mobile phone companies, try to limit effective competition by contract terms etc, to limit the propensity of consumers to frequently shop around. Imperfect competition and poorly designed markets go a long way to explaining why deregulation often ends up hurting the consumer. The key to an efficient market isn't deregulation - it is strong safeguards to maximize competition. Competitive, transparent, efficient markets don't just happen; they typically require a large degree of regulatory oversight. A good example is commodity or stock exchanges. They are good at providing efficient market pricing, but they also need fairly intense regulatory regimes (both internal and external) and only deal in standard products under standard terms. The best option for minimizing consumer electricity would be a market structured to ensure maximum competition. This could include measures like guaranteeing consumers an guaranteed contract opt-out. "Free markets" are great in theory, but there is often a regulatory price to be paid for them to work. Link to comment Share on other sites More sharing options...
jm1fd Posted June 9, 2008 Share Posted June 9, 2008 For whatever reason, many people assumed that deregulation would somehow automatically lead to lower prices (fuel cost increases aside).Assumed it would lower rates? WTF? Where have you been? I recall hearing the proponents of deregulation get up in front of the entire state of Texas and tell us how it would lower rates through increased competition.... Link to comment Share on other sites More sharing options...
houstonmacbro Posted June 9, 2008 Share Posted June 9, 2008 Big businesses always lie. Link to comment Share on other sites More sharing options...
RedScare Posted June 9, 2008 Share Posted June 9, 2008 Assumed it would lower rates? WTF? Where have you been? I recall hearing the proponents of deregulation get up in front of the entire state of Texas and tell us how it would lower rates through increased competition....No kidding. There was no subtlety or assumptions involved. Lower rates were promised by all involved, which is no surprise. If they had not promised lower rates, no one would have supported deregulation. Let's face it, consumers were misled intentionally, so that a very small group of people could profit...all in the name of "free markets". Link to comment Share on other sites More sharing options...
Subdude Posted June 10, 2008 Share Posted June 10, 2008 If they had not promised lower rates, no one would have supported deregulation.And if suppliers didn't think they would have been able to capture higher prices, they wouldn't have supported deregulation. Link to comment Share on other sites More sharing options...
20thStDad Posted June 10, 2008 Share Posted June 10, 2008 Well that's a nice racket they have going. This wouldn't happen to have been done on a trial basis and be going back to regulated soon, no? I can hope. Link to comment Share on other sites More sharing options...
crunchtastic Posted June 10, 2008 Share Posted June 10, 2008 Well that's a nice racket they have going.http://blogs.chron.com/newswatchenergy/http://www.chron.com/disp/story.mpl/business/5828302.htmlIt's a nice racket, alright. I was curious as to what happens to the customers of these companies that have gone under in recent weeks after getting jacked up in price spikes. The consumer gets placed into a plan with a Provider of Last Resort, and gets charged even higher rates until they can find a new provider, and manage their way around all the byzantine rules on switiching providers without incurring additional fees. Nice. The company gets their ass out of a sling with bankruptcy reorganization, the consumer gets to pay yet more. Link to comment Share on other sites More sharing options...
brerrabbit Posted June 10, 2008 Share Posted June 10, 2008 Think about the electric market for a second and consider why it was regulated to begin with. The original regulations were put in place to incent a company to take on the business. At that time rates were regulated to a level to guareentee power companies that they would make money. The had huge capital outlays for the plants, transmission, and distribution systems. The government had to guareentee them a fair rate of return just to get them into the business. So cities decided to go the municipal owned route and those cities are enjoying the results of those decisions today. Houston and Dallas left it to public companies to do. As a result what happend today is that how additional costs are incurred for providing electricity how are those costs paid? In Houston and Dallas, the individual consumer pays. In cities where the municipality owns the power company everybody pays in terms of higher taxes. One thing is certain, as demand grows the cost of incremental power is the same for everyone, the only difference is do you pay more monthly or do you issue bonds that taxes have to service. Deregulation is not working to lower costs. What has effectively happened is that all the plants that were built in the past 15 years as incremental service providers and peaker plants have been converted to independent operators and they produce power and sell it into the grid. We pay the full cost of that service in terms of our monthly bill. The differences in rates is directly related to the plant that generates the power. In Houston and Dallas theoretically everything we buy comes from independent plants that have to operate at current economics with no subsidies to stay in business. They will never compete against the municipals because unlike the municipals they have shareholders to answer to and profits to make. This is a problem that is not going to be fixed anytime soon. Finally consider this only Houston and Dallas are still paying for the nuclear power plants that were suppose to solve all our problems. None of the other markets are. Link to comment Share on other sites More sharing options...
memebag Posted June 10, 2008 Share Posted June 10, 2008 In cities where the municipality owns the power company everybody pays in terms of higher taxes.Really? I can't find any evidence to support this. How much tax money goes to the electric company in San Antonio? Link to comment Share on other sites More sharing options...
RedScare Posted June 10, 2008 Share Posted June 10, 2008 San Antonio's tax rate is $0.57 per $100 versus $0.645 in Houston.Bexar County's tax rate is $0.29 per $100 versus $0.39 in Harris County. Link to comment Share on other sites More sharing options...
crunchtastic Posted June 10, 2008 Share Posted June 10, 2008 regarding the 'more in taxes' argument:Actually, it's the other way around. EDIT for new data: 28% of the 2008 SA city budget is from CPS revenues. More than property taxes at 26.5%. http://www.sanantonio.gov/proposedbudget/g...80&ver=trueIt is the largest electric utility in the country. For those who ask "why should I trust the government to run a utility" I'd say this is a successful model, as have been several others around the country. Imagine if the city of Houston owned a single utility, it would have purchasing power on a scale even larger than SA's. Remember, deregulation was conceived and backed by industrial users and businesses who figured that with their economies of scale, they'd get a break. This was never about the residential consumer. They just pushed the same "you have the power to choose" propaganda out to the consumers and counting on anti-big-government rhetoric to keep joe sixpack from raising a stink. Link to comment Share on other sites More sharing options...
memebag Posted June 10, 2008 Share Posted June 10, 2008 regarding the 'more in taxes' argument:Actually, it's the other way around.My head just exploded. I blame Milton Friedman. Link to comment Share on other sites More sharing options...
RedScare Posted June 10, 2008 Share Posted June 10, 2008 regarding the 'more in taxes' argument:Actually, it's the other way around. ...oops. There must be a free market answer to this socialist dogma. Link to comment Share on other sites More sharing options...
crunchtastic Posted June 10, 2008 Share Posted June 10, 2008 My head just exploded. I blame Milton Friedman. The mind boggles! The government runs its public utility so succesfully the revenues account for the single largest share of the operating budget, and charge the lowest electric rates in the state??? Link to comment Share on other sites More sharing options...
RedScare Posted June 20, 2008 Share Posted June 20, 2008 Ah, the joys of deregulation. Link to comment Share on other sites More sharing options...
westguy76 Posted June 20, 2008 Share Posted June 20, 2008 I was with First Choice power locked into a 12 month deal at something like 12.9 a kwh. that expired and I got shifted to month to month last month , not paying attention to it. I had a $335 dollar bill in May they moved me to 19 cents per. June's bill could be larger. I have since switched back to reliant month to month as it was the best I could get month to month at this peak time. And it's no bargain. I guess I learned my lesson Link to comment Share on other sites More sharing options...
ssullivan Posted June 22, 2008 Share Posted June 22, 2008 Today I paid my last electric bill from Houston Link to comment Share on other sites More sharing options...
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