Heads up on What is Going on in the Market This Month

Right now the market is still close to a 3 year high. We saw electric rates in Texas go up the entire month of June and now in July we still see energy prices rising higher. Most people have noticed in the news of how oil has reached $148 setting an all time historical record. The energy sector is up across the board and Houston electric rates are the highest in the state of Texas. Houston must pipe in their energy from far off causing line losses. The power consumption and demand of Houstonians causes congestion and they just don’t turn on enough power plants in your town to meet peak demand periods. Because of these issues you pay ridiculously high prices. Last year rates were around 10 – 11 cents kWh. If you are now trying to renew an energy contract or lock in again you will be surprised to see Houston electricity rates about 5 – 10 cents higher then last year.

July 2008 Electric Rate Chart

We have Houston, Harris County, Brazoria County, and surrounding Centerpoint Energy utility areas electric rates listed here from best to worst. A 12 month fixed Houston electric rate is recommended as rates are expected to travel back down. Long term contracts are cheaper, however you would be locking in at the top of the market when the expectation is that electric rates will be coming back down before 24 and 36 months. Many of the electric rates in the chart below are discount 12 month fixed electric rates. By clicking on the links below and signing up online you will achieve a slightly better rate then what that company normally advertises.

Residential Electricity Close to a 3 Year Historical High

The market is way up right now and a question on a lot of peoples mind is if they should sign up on a 12 month fixed rate contract or a longer term such as a 24 or 36 month fixed rate contract. Right now a 24 month and 36 month fixed rate contract is cheaper then a 12 month fixed rate. The reason you get a cheaper rate as you go longer terms is due to a correlation with the natural gas market. Natural gas futures contracts are cheaper as you go out on a longer term. You can verify this by looking at futures contracts for natural gas on one of many commodity broker quote sites. The key to what you should do is in the contract. The reason they give you a cheaper rate is because they believe rates will come down between now and 24 months or 36 months from now. Because the commodities traders expect rates to come down they have a strategy to sell you on a longer term contract at a cheaper price. Many people fall for this but keep this in mind, you would be locking in at the top of the market.

We recommend signing a 12 month fixed electric rate agreement and trying again next year. We have a comparison chart listed below of multiple electric companies in North Texas, Dallas, Fort Worth, Plano, McKinney and the rest of the Oncor Electric Utility area of Texas. Compare and pick a provider. Some of the links below are discount 12 month rates, cheaper then what the Texas electric companies generally offer. Simply click the provider you want to go with and sign up online. The Texas government will automatically take you off your current electric provider and put you with your new one. You will not need to call your current provider to be taken off as this happens automatically.

July 2008 Texas Electric Rates in North Texas

Find a rate you can be confident about for the next year and try again next year. The market is very high right now so these rates will be much higher then what they looked like last July. The rates are updated as of July 6 2008. Many times the market will go up or down within a few weeks. You may click on the links below and possibly find the company offering a slightly higher or lower electric rate as we move further into the month of July.

TXU

Many times when a company uses TXU Energy as their energy service provider they find that a problem or two may develop in the process of their contract. These problems could be major or minor but the question comes up as to how to go about negotiating and delaing with customer support. TXU is a very large company and at one time was a monopoly. Oncor Electric Delivery is a division that broke off of them and actually became their own entity unaffiliated with them in any way. This allowed other electric providers to come into the Texas market and compete with TXU.

If You Have Broken Your Contract Agreement With TXU Energy

Some commercial businesses have accidentally broken their contract agreement with TXU when electric rates went down and another electric company came into the mix offering a better deal. Generally the competing electric provider notifies the business that they are about to break their agreement with the other provider when Oncor or ERCOT makes this known to them. This notification process doesn’t always happen and sometimes falls through the cracks. In these cases you may be stuck with an early termination penalty that is usually about 2 months averaged bills or something that is based off of current market rates. If the penalty is based on current market electric rates you usually have some wiggle room to get the penalty lowered some.

Where To Start

You should start by talking with the Electricity Provider that didn’t notify you that you were about to break your energy agreement with the other electric provider. Call the energy company in question (Your Previous Provider) and ask to speak to a manager. The manager will have the skill and knowledge to answer your questions and possibly negotiate a way out of the penalty. Explain your honest mistake with the provider and let them know it was accidental. Let them know you would be willing to come back onto their original energy contract if they will waive the early termination penalty. After you have worked out an agreement with your old energy provider you will want to call your current electric company (TXU Energy, Reliant Energy, Direct Energy, etc) and explain your situation. You want to try and let them let you out of the agreement while your not too far into it. They will be more likely to let you out without penalty the sooner you notify them of the situation.

Give Them Added Details

If you are a well known public non-profit or just happen to have a good reputation in the community then politely let TXU Energy know that you have that type of influence. Make it clear that the situation was by accident and you would like some type of compromise between your company and the energy company penalizing you. Any additional information such as low cash flow issues and the potential that the penalty could cause serious consequences to your job or the company as a whole could help influence their situation.

After All Avenues Have Been Exhausted

After trying everything to get the penalty removed and still no compromise you may want to speak to an energy consultant to see if their relationship with the electric companies could help in the influence to reduce or remove the penalty. You can speak to an energy consultant here:

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