Helping Commercial and Residential
Clients Lower Energy Costs
Newsletter – June 2021
I hope you find the following articles helpful in better understanding the electricity market so you can become a more informed buyer. I’m here to help you find the right price with the right electricity provider. If you have any questions about your service please contact me.
Current Electricity Rates
Current electricity rates for commercial service are very dependent on start date, usage, load factor and term. Check your current electricity invoice and call me. I’ll let you know if you have a good rate or help you renew.
Current electricity rates for residential service are also dependent on start date, usage, load factor and term. Check back later when we introduce three service residential rate service plans.
Understanding Your Electricity Bill
Your electricity bill has three primary components, i.e. 1) commodity rate, 2) distribution rate (sometimes called transportation rate) and 3) taxes. The commodity rate is what retailers are competing on. The distribution rate and tax rate are regulated. The total of the commodity rate and distribution rate times kWh of electricity used equals your electricity cost before taxes.
In different geographical areas there is a distribution company that has the exclusive right to distribute your electricity in your area. However, there are many retailers of electricity in deregulated areas that you may purchase electricity from. The retailer that sells electricity to you collects from you the commodity charge, distribution charge, and taxes.
When Should You Execute An Electricity Contract
Timing when to purchase electricity is just as important as when to purchase a stock. Generally there is a seasonality to buying electricity. You want to avoid executing in the high heat of summer or the low cold of winter. These periods usually have higher rates. Look at executing a short term contract to position yourself for an off peak period. Then when you’re ready look at pricing options out 1 to 9 years.
Execute A Contract Now To Start In The Future
Yes. But why do this? If you think electricity rates might increase in the future, you can sign a contract now to start 2 to 5 years in the future. The rate you pay starting on that future date will be the rate that is determined now. And you can do this with a different retailer then you are getting service from now. You will continue to get electricity service now at the rate you negotiated at the time you executed your current contract.
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A Texas woman has filed a proposed billion-dollar class-action lawsuit against electric company Griddy Energy that alleges the company engaged in unlawful price gouging during last week’s statewide winter storm and power outages, according to a statement from the law firm. Lisa Khoury, a resident of a Houston suburb, claims she was charged a total of $9,546 by Griddy from February 1 to February 19, according to a copy of her bill filed with the lawsuit. Khoury’s average monthly electricity bill before February ranged from $200 to $250, according to the suit.
Texas officals are investigating outrageous energy bills in storm price surge. The suit claims that Griddy “committed price gouging,” was negligent when it “failed to shield consumers from excessive electrical bills,” and that, by selling electricity at high prices in the middle of the storm, the company was “unjustly enriched.”Griddy did not immediately respond to the allegations in the lawsuit when reached by CNN, though it did send statements broadly addressing the claims of price gouging. The company flatly denied that its business model of selling electricity at wholesale prices to consumers is price gouging. Texans have options for how they are billed for their electricity, according to the Public Utility Commission of Texas’ (PUCT) website. If a customer chooses a fixed plan, their price for electricity is locked in and doesn’t fluctuate with the market, as opposed to market rate plans such as those made available in this instance by Griddy.”We charge (customers) the wholesale, real-time price of energy, which changes every 5 minutes,” Griddy wrote in its statement. “You effectively pay the same price as a retail energy provider or utility.” On its corporate website, Griddy touts that customers “pay exactly the price we buy electricity at” and that their model “beats the (Texas) average 96% of the time.”
How Texas’s deregulated market for power let to exorbitant electric bills. In a statement last week, the company faulted the state Public Utility Commission for implementing “a non-market pricing mechanism for electricity mandating prices reaching as high as hundreds of times normal prices.” Here is what we do know: the market is supposed to set the prices, not political appointees,” the company said, adding that it was also seeking relief from regulators for its customers who were exposed to the high prices. The lawsuit, filed Monday, seeks an injunction to prevent Griddy “from billing and collecting payments from customers charged with excessive prices” and to “fully forgive any late or non-payments.” Khoury and all other members of the proposed class, which would include all Texas residents who used Griddy and were hit with excessive charges resulting from the storm, are “seeking monetary relief of over $1 billion.”
Copyright 2010-19 EnergyChoiceMatters.com Reporting by Paul Ring • email@example.com
During a discussion of recent ERCOT grid conditions at today’s open meeting, Texas Public Utility Commissioner Arthur D’Andrea, while noting that it was still August, commended ERCOT’s recent performance and observed that, “We asked you to run a grid with very tight reserve margins, and you stepped up and you’ve given us reliability and probably the most efficient grid in the world, that saves Texans a lot of money.”