HOUSTON – It’s not just the heat that is causing your electricity bill to rise. Electric rates are much higher. Shopping around for the best electricity rates is something Investigator Amy Davis gets a lot of questions about. In this week’s Ask Amy: shopping for the lowest electricity rates and why signing up for the deals and gimmicks may not be a good idea.
Electric rates in Texas are much higher right now
Right now, the average new 12-month electricity plan is about 16 cents per kilowatt/hour.
This time last year the rate was about 10-cents.
Energy Ogre says your bill this means the average Houston customer (using 2,000 KwH per month) is paying about $120 more per month.
At the same time energy companies like NRG and TXU are making a ton of money. The stock price for NRG was $35 last June. A year later it has more than doubled peaking this month at $86.44. The price of natural gas – that is used to make energy – remained relatively low, under $3 since last year.
How long will electricity rates be high?
Energy Insider Mike Harrington joined Amy Davis for an episode of Ask Amy. Amy asked how long rates will be this high.
“The good news is that in November, we amended the state constitution to spend $10 billion to build natural gas power plants,” said Harrington, electric broker with American Enerpower. “Those plans were just submitted. And so now the Public Utility Commission and ERCOT will figure out who’s got the best plan, and you’re going to see new power plants being built, hopefully quick. I don’t think if you started today, it’d be on next year.”
So basically, until those plants are all implemented. So those plants are built, I think prices are going to be high for at least two, maybe three years. So, I wouldn’t do a one year. I would do a two-year contract, maybe even at three-year kind of. There’s no reason out there for the demand to go down. People are still moving the Texas; people are still building things. And no one has got new power plants yet. So until you get the new power plants on, prices are not going down and hopefully we pick up a lot of good.”
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Try to sign up for a two- or three-year plan.
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Forget those gimmick or deal offers you may see like free nights and weekends.
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Those deals may have you paying more on average than you might have saved paying a fixed rate.
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You can also just call the electricity provider and ask what the best rate is right now.
Watch the full Ask Amy episode today at 11 a.m. on KPRC 2 Plus.
RELATED: Hidden electric bill fees
As if finding the best electric rate and plan wasn’t hard enough, now some electric companies are trying to keep brokers from helping consumers get the lowest rates.
See more: KPRC 2 investigative reporter Amy Davis looks into this battle between an electric provider and an energy broker that has customers caught in the middle.
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