Recent Wall Street Journal Article Mischaracterizes Texas’ Competitive Electric Market

A recent Wall Street Journal article (“Texas Heat Offers No Relief on Electric Bills,” by Rebecca Smith and Tom Benning, Aug. 26, 2009) only considers the electric rates of two municipally-owned utilities. We encourage a look at rates in the competitive market as well.

While the central thesis of the article — that customers have higher electric bills due to sustained summer heat — is logical, the story leaves the impression that retail electricity prices haven’t fallen since their highs from a year ago. Unlike the rate increases described in the article, wholesale and retail electricity prices are lower than in 2008 in the parts of the state served by the competitive market.

Led by falling natural gas prices that have driven down wholesale energy costs, customers shopping in the competitive market this summer can find prices as low as about ten cents per kilowatt hour, depending on the region and type of plan. In fact, the lowest prices available in the competitive market today are lower than the last regulated rates in 2001.

Also, retail electric providers have implemented customer protection measures such as reduced prices and voluntary summer customer protection plans in light of declining wholesale prices. Some of these programs make it easier for customers to move from higher priced plans to lower priced plans.

Shopping for service in competitive areas while looking for innovative ways to reduce usage — such as improving energy efficiency by weatherizing homes — are the best solutions to help with higher electric bills. Consumers should visit www.powertochoose.org and www.texasishot.org to learn more about their options and ways to reduce their use.

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  1. Shouldn’t we be looking at producing greener energy as well as cutting down on what we use.

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