Picking The Right Houston Electricity Company, Rate and Plan

What to Know Before Signing up With Just Anyone

We have compiled a list of some of the more popular residential Texas electricity companies and rate plans. If there is a known issue with one of the residential electricity companies we list that concern next to the provider. There are some providers that have blatantly obvious tricks we know of that shows one rate on their website but when receiving your first electricity bill the rate is much higher due to the TDSP charges not being clearly apparent. A note should be made that these Texas electricity providers are usually involved in leaving off the TDSP charge on their advertised rate. We are not sure exactly how many energy companies participate in this practice as well as they change their practices depending on how much heat they are receiving from PUCT complaints. You can read Consumer Energy complaints from some of these providers customers who can explain what exactly can occur when switching to a gimmicky energy company better than we can.

August 7 2009 Residential Houston Electricity Company Comparison, Cheapest to Most Expensive

Understanding Your Houston Residential Electricity Rate

Most electric providers in Texas will bundle the TDSP charges into the energy only rate giving you an all-in rate that can be compared against other Texas electricity companies like TXU Energy and Reliant Energy. We have listed both TXU and Reliant in our comparison chart in order to compare their electricity prices with other Texas electric providers. You will notice that the two largest energy providers in Texas have much higher electricity prices than some of the smaller but good electric companies. Right now Champion Energy and Startex Power are two reputable electricity providers in Texas offering very cheap fixed electricity rate offers. All fees and charges are disclosed with these two companies. With Startex if a customer uses less then 500 kWh hours a month there will be a $4.95 monthly service fee although most Texas electricity consumers use more then this so it shouldn’t be an issue for most customers. A monthly service fee is simply an additional charge many electricity providers have in addition to their electricity price. It is important that a provider disclose this fee upfront rather than hide it in the contract details. We have made these fees obvious in our rate chart so you can make a clear apples to apples comparison of electricity prices in Texas.

Historical Houston Electricity Rate Snapshot for August 7 2009

Since this Houston electricity comparison chart is an update for August 7 2009 it only represents a historical snapshot of what Texas electricity providers were charging on this date. An updated and daily refreshed electricity rate chart is also provided below with some of the cheapest Houston electricity companies. We hope this historical list of Houston energy providers in prices above will keep you informed of how prices move over the course of several months. If you have any questions or comments about one of these Houston electricity companies please feel free to leave a comment below. If you are interested in a no deposit Houston electricity choice please visit our no deposit electricity page.

Current Houston Electricity Rates, Companies, and Plans

Oh No! More Surcharges on Your Commercial Electric Bill

The Texas government has recently added a new surcharge to your commercial businesses electric bill. If you operate a commercial or industrial business in the state of Texas and are paying for electricity then you qualify for the additional surcharge on your electric bill regardless of the elecric company you have chosen to sell you electricity. Starting on 12/29/2008 for the Oncor Electric Delivery area (Dallas, Fort Worth) which is most of North Texas and starting 2/2/09 for the the CenterPoint Energy utility area (Houston, Harris and Fort Bend Counties) your electricity bill will now have a surcharge added under the TDSP line item. The new surcharge is called “Transmission and Distribution Service Provider (TDSP) Meter Surcharge” and is based on your businesses kW demand.

How to Lower the new KW Surcharge

To keep this surcharge down you will want to limit the amount of large machines running at the same time in your commercial facility. The KW demand increases the more machines, appliances, printers, lights, etc you have on at the same time regardless of how long they are on. kWH is the amount of electricity you use in total but does not apply to this surcharge which is based totally on demand usage. This electricity surcharge is officially a PUCT-approved pass-through fee. There are electric providers out there that will extrapolate some of the fees from the “energy only” charge and place it in the TDSP line item to make their electric rate look better. This is not one of those charges or schemes. No matter the Texas electric company you may be using you will begin to see this new surcharge on your electric bill.

Possible Opportunity For Some Energy Companies to Scam

If you think that your “Transmission and Distribution Service Provider (TDSP) Meter Surcharge” is excessively high or that the provider may not be charging you correctly for this charge then please feel free to give us a call. One of our energy consultants would be glad to do a bill audit and verify if what you are paying is an accurate charge or an attempt by an electric provider to increase the electricity rate they charge you.

Feel Free to Call Electricity Bid

Call us at: 1-800-971-4020

Residential Electric Customers Complaining about Additional Fees Crammed In

I have started to receive some calls the last few days from a few residential electric customers complaining that a certain retail Texas electric provider and recent start up in Texas has been cramming in additional charges in their fixed rate. The customers were told by the provider that they still have a fixed rate but the TDSP charges were raised on their rate plan. The electric company past the issue on to the non-negotiable TDSP charges as they are past through on an electric bill. The issue is that residential customers who lock in on a fixed electric rate are also locking in the TDSP (Transmission and Distribution Charges) charges. The TDSP charges cannot be changed as they are regulated by the Texas government so Texas residential energy customers can have some price protection for a certain term.

Commercial Rates are Different then Residential Rates

Texas commercial electric rates are different in that the TDSP charges differ from one business to the next. For instance, a Smoothie Factory store may pay 8 cents kWh on average for TDSP’s on top of their Energy Provider Generation Charge but a manufacturing facility may only pay 1 cent kWh. So commercial companies are protected on the Energy Provider Generation Charge but not on the TDSP charges. The issue at hand here is that some providers are trying to make it sound like the same thing applies for residential electric customers. Residential electric customers in Texas that sign up on a fixed electric rate should have both their TDSP charges and Energy Provider Charges locked in to one fixed rate that will not change the entire term of the contract.

Don’t Be Fooled

If an electric company in Texas tries to tell you that the reason your residential fixed electric rate has gone up so much is because of TDSP charge increases you need to quickly write a detailed complaint and send it in along with the electric bill in question via fax to the Public Utility Commission of Texas.

You can fax your issue to the PUCT at fax number: 512-936-7003

Read more about Texas Electricity

Read more about Startex Power

Read more about Champion Energy

Mathew Tomlinson is sick of looking at his electric bill and being overcharged beyond the normal rate he has been paying his electric provider.

He is not alone as several other people in his business location have called angrily to their Piney Point Village electric company to express outrage at the higher electric rates.

Many residents have thought about drafting a petition regarding the higher electric rates and mailing it to the Electric Reliability Council of Texas to try

and do something about the higher energy costs. ERCOT has had plenty of corruption in their ranks in the past and many have wondered if the tariffs and TDSP

charges have been done with the Texas consumer in mind. Kickbacks and a network of commercial bribes have caused operations at ERCOT to look a bit like

something you might see in Russia although the corruption element at ERCOT is all supposedly cleaned up now. Many were surprised the Texas ERCOT organization

created to oversee the electric grid in Texas would come up on corruption charges. Could there possibly be something to the claim that some of ERCOT’s rules

and regulations were created from past corruption and commercial bribery. If there is any hint of truth to this then all those Texas consumers fed up with higher rates may eventually feel vindicated when they get to say, “I told you so.”

ERCOT insists they are doing as much as they can to keep electric customers costs low. The nodal system that ERCOT is implementing across the state should

alleviate some cities from paying higher congestion and line loss related charges that the bigger cities in the region cause. This will help lower costs in some areas and give an incentive for larger cities to work on improving their efficiency in the electrical within buildings, with new pole and wires infrastructure, and lowering overall KW electricity demand from business to business.

Line items on an electric bill have caused confusion underneath the TDSP charges section. Many times for commercial customers the TDSP charges can make up 50% or more of a companies electric bill. This has caused many commercial companies to have to close shop as the electricity to run the business is too expensive to continue to stay in business.

Residential TDSP charges only make up a small percentage of the electric bill. Residential electric customers spend about 2 – 3 cents kWh in TDSP charges

while the remainder of the electric rate is from the Retail electric provider. The 2 – 3 cents in TDSP charges are past through from the pole and wires

utility company with no additional markup. There is currently no law in place in Texas that does not allow marking up the TDSP charges so some electric

providers have lowered their “energy only” rate only to then raise their “TDSP charges” higher then the normal pass through with no markup. This trick has

caused many people to second guess their electric bill when changing to the supposedly cheapest electric provider in Texas.

Natural Gas has been going up steadily which makes up most of the fuel that powers the electricity generation plants in Texas. Because natural gas is tied so

closely to Texas electric rates you see a very close correlation. Natural Gas hit a 3 year high not to long ago and electric rates in Texas also hit a 3 year

high at the same time. Having more alternative power generation plants can even out the erratic Texas electric prices and give Texas consumers a cheaper electric.

Building clean coal powered electric generation facilities as well as nuclear will help stabilize the electric prices in Texas. The United States is the

Mideast of coal if you were to compare us to the amount oil the Mideast controls. Texas should start building more coal power plants that can burn the coal

and a clean way. Clean coal power is a possibility and would drastically lower the states electricity rate.

Electric rates right now are so high because of the energy commodities market but that is not to say that there could still be some funny business going on

with some the PUCT’s (Public Utility Commission) and ERCOT’s tariffs and regulations. ERCOT did have a recent history of corruption and not everything is known about what all went on. The PUCT has no corruption related charges against them and in fact enforce strict rules and penalties against electric companies that do not obey by the rules.

Jim from Texas City said, “I have an electric bill where I pay about 16 cents kWh just in TDSP charges for my business. This became so high I could no longer

afford to stay in business. I eventually had to close my bed and breakfast and work for somebody else.”

The Electric Reliability Council of Texas (ERCOT) operates the electric grid and manages the deregulated market for about 75 percent of the state

Most commercial business owners in Texas paying the amount in TDSP charges as Jim was paying would be willing to sign a petition and send it to ERCOT. The issue is that small business owners sometimes get hit with a TDSP charge that just doesn’t justify keeping the doors to their business open any more. “The electric rate for a business in this situation is just to high” says, Jim.

“Texas commercial businesses I talked to said they would sign a petition even though they imagined it probably would do absolutely no good.” he said.

Jim, wasn’t confident that having a petition signed by several business owners in Texas would do any good but he wanted to go on record that he was not happy with electric rates for businesses in Texas.

“Most people don’t say anything to the government, ERCOT or the PUCT about how they feel but I think somebody should say something to show people are beginning to take notice”, he said.

ERCOT maintains they are operating at the highest ethical and professional conduct and have done everything in their power to remove corruption in their ranks. The PUCT’s tariffs and regulations related to TDSP charges have been fashioned based upon the fairest business model they could agree upon that considers several different tiers of energy usage. Some companies demand more energy at one particular time in the day but do not use that many kilowatt hours throughout the day. These companies get hit with a TDSP charge that is made up of about 90% in demand charges. Companies that find themselves in this situation should hire an electrician to come in and audit the electrical in the building for ways to become more efficient and to lower their peak electric demand KW.

Public Utility Commission of Texas Talks Straight

The PUCT today explained why deregulation may not be working as planned in some areas of the state of Texas. There is not a whole lot of data prior to Texas deregulating the electric rates in 2002 but what information we do have has remained inconclusive at this point. Right after deregulation we saw several large electric monopolies become deregulated. “Deregulated” just means that the state of Texas has unbundled the pole and wires charges from the “retail energy rate”. The reason they unbundled the rate is because the pole and wires company is an altogether different operation from the energy trading desk that buys energy in the form of natural gas and other commodities and resells it as electricity to commercial and residential customers. Once the rate was unbundled any new Texas electric company that wanted to could open up business and sell the retail energy to customers while the same pole and wires company you have always used passes through the pole charges onto the electric bill with no markup. If you have picked an alternate electric provider since deregulation you can actually still see the pole and wires company number on the bill in case of an electric outage. The number on the bill helps to confirm to Texas energy customers that they still deal with the company they always have when it comes to the electric service infrastructure and transmission.

An Example Of A Deregulated Electric Utility

TXU Electric Company was deregulated back in 2002 and as you may or may not know they kept their same name when they became an independent Texas electric provider. That means that their pole and wires company was called TXU and their retail energy company was called TXU even though they legally could not be affiliated with the pole and wire division. They were basically two altogether separate companies because legally there could be coercion if they were still affiliated. Imagine if you switched to a different retail electric provider and “TXU” the pole and wires company decided they would get you back by raising your TDSP charges on your bill which covers the pole, wires and meter maintenance? This would be a good way to keep people from leaving TXU since pole and wires charges can sometimes make up 50% or more of your Texas electric bill.

TXU Electric Delivery Had To Rebrand

What ended up happening because of continuous fear and confusion, because the name was so similar to the old monopoly, was a complete rebrand of the pole and wires part of the company. TXU Electric Delivery had to rename themselves “Oncor Electric Delivery” in order for people to distinguish between TXU (The Retail Electric Provider) and TXU (The Pole and Wires Company or TDSP Company, now called Oncor). Even after reading this lengthy explanation many people will still have no idea that TXU just sells the electricity (a paper transaction bought and sold on commodity markets and hedged) and no longer maintains the poles, lines and meters. Even as of today you will still see TXU Electric Delivery as a brand name for Oncor Electric Delivery even though they are no longer called that. Oncor even owns the name “TXU Electric Delivery” although imagine if Microsoft found a company using their brand name even if not in the same line of work? Microsoft would sue their pants off and the company would immediately need to cease and desist all use of their brand name. This is not the case with Oncor as they use Oncor and TXU interchangeably which helps in the confusion process and brings in multiple electricity customers back to TXU Energy Retail Electricity. It would appear that Oncor using TXU as a part of their brand name is an effort to help TXU Energy Retail gather new and existing customers even though they are no longer the same company. Many people call TXU Energy to have their electricity turned on thinking they are calling the poles and wires company. TXU Energy signs the new customers up left and right because of this confusion process and there does not appear to be any end in site. The rate is usually not very competitive in comparison to other retail electric providers in Texas and neither does it need be considering that these customers are signing up on a brand they believe to be their only choice in “turning on new electric service”.

Example of An Alternate Texas Residential Electric Provider To Compare With TXU: Startex Power is currently the cheapest provider: learn more and Champion Energy comes in second place.

Oncor Maintains The Poles, Wires and Meters

So what have we learned? Oncor reads your meter and maintains the electric infrastructure in North Texas. They are the ones who pass through your TDSP charges on a 1 to 1 basis on your retail electric bill. The reason they are called pass through charges is because most retail electric providers like, TXU Energy, Gexa, Startex, Spark, Champion, Bounce Energy and multiple others do not markup the TDSP charges from Oncor but pass them through on a 1 to 1 basis. There are a few Texas electric providers who do in fact markup the TDSP charges while offering a competitive retail electric rate. What ends up happening is you believe that Oncor has past through those charges with no additional markup on your bill, which is the only company who can since they own the electric infrastructure in North Texas. You receive a competitive retail electric rate with no indication, except in fine print in the energy contract, that the TDSP charges have been marked up by the retail electric provider (not Oncor). This allows a few retail electric providers to come away with extra profit margin until the PUCT of Texas makes this an illegal deceptive trade practice. Until the PUCT does something about it some electric providers will continue to do this until bad publicity catches up with them.

No Historical Data On TXU Energy Electric Rates Prior To 2002

There is not a lot of data showing what the last previous 2 years prior to deregulation showed for what electric rates were at for TXU Energy. This information would be useful in understanding what the Texas retail electric rates have done before and after with TXU since deregulation began in 2002. What we would need is the electric usage data file going back before 2002 for a particular company or residence. This can be obtained from Oncor Electric Delivery in the Dallas and East Texas area and from Centerpoint Energy in the Houston area. We would then need some corresponding electric bills prior to deregulation. Any electric bills before 2002 will prove helpful. We can then compile the data and give some estimates of what electric rates have done before and after Texas deregulation in regards to TXU Energy. We would also take into account what natural gas prices have done since deregulation began. There was a time right after deregulation when natural gas spiked up to some historical highs which caused electric rates to drastically rise. This rate spike made it look like deregulation was having the opposite effect that the state of Texas was expecting.

If you have old electric bills and usage data please feel free to fax it to 1-903-484-9222 and we can use it in our analysis. We appreciate your help in this matter.

Texas Deregulation Debate, What Is the Current Controversy?

The debate right now is whether or not Texas deregulation actually caused electric rates to go up instead of down. Many people believe that NOT breaking up the monopolies would have been a better choice. Their reasons have to do with several factors.

Factor 1

One reason has to do with the natural gas spike back in the beginning of 2002. Natural gas has a 90% correlation with electric rates in Texas. Because natural gas spiked so did Texas electric rates and this was at the same time Texas unveiled deregulation. Timing was very bad in this case in giving the Texas public the perception that deregulation works to reduce electric rates.

Factor 2

The second popular reason is that city municipalities and coops near deregulated towns often pay a few cents kWh less for their electricity then the deregulated city next door. These city owned municipalities and coops give the public the perception that deregulation has done nothing but raise rates. The factor that people are not recognizing is that the prior monopoly retail electric providers like TXU, First Choice Power, Entergy, WTU, Reliant, and CPL may have had abnormally higher electric rates then some of the smaller city owned coops and municipalities. The only way to know for sure if this is the case is to provide historical electric usage data and historical electric bills prior to 2002 from one of these retail electric monopolies also known as Texas Affiliate electric providers. You can send us your historical bills and usage data and we would be glad to investigate.

Fax : 903-484-9222

Factor 3

Another point to consider in regards to factor 2 is that not all city owned municipalities and coops have cheaper electric rates then the deregulated Texas electric providers. Take for instance the city of Garland Texas. The city of Garland has many times had higher electric rates in comparison to competitive Texas electric companies like Champion Energy or Startex Power. There are several other municipalities that have historically had much cheaper electric rates then the competitive Texas electric providers in the deregulated counties of the state. One such provider is in the cities of Longview and Marshall Texas. SWEPCO also known as AEP is not deregulated in these areas and is a few cents cheaper then cities just outside of it like Tyler Texas. The only explanation as to why they are able to provide a cheaper electric rate would be related to less advertising dollars spent at competing against multiple other electric companies. Texas has made the record books at being the most competitive electricity market in the world and AEP SWEPCO has avoided the issue of needing to compete with other providers by having absolutely no competition in this area of Texas. They also have the added pressure of needing to keep the rate low so that the city does not decide one day to deregulate the area because of being overcharged by their monopoly electric company. Longview must also contend with the fact that by deregulating the area they could bring in new businesses and jobs to the city which gives them more tax dollars. In the end a Texas city or county may decide to deregulate because the electric rates would be cheaper, they could add tax revenue and new jobs, and the possibility that Texas Energy lobbyists have swayed them.

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