Compare Electric Rates In Texas: Helping You Navigate the Waters of the Electricity Market
Despite being such an important part of a family or business’s monthly finances, not many people are very familiar with how the industry works or how it can work in their favor. CompareElectricRatesInTexas.com has the information you need to learn about the electricity business and how to find an energy plan that could potentially save you money each month.
Electricity rates in Texas change as deregulation sweeps across the state
In the 20th century, Texas consumers only dealt with one company when it came to their electric service. Their utility was the business that sold them energy and made sure that their home or commercial enterprise had electricity. All power lines were owned and maintained by these businesses as well. When Texans received their electric bill, they were charged by their utility for both the cost of electricity itself and the cost of transporting that energy. These costs were regulated by governing bodies to make sure they were fair to consumers, but they still allowed companies to make a profit.
In 2002, the government decided to change the nature of the industry. On January 1st, Texas Senate Bill 7 was passed. This bill separated the prices for energy and transport, and created an open competitive market for individual companies to charge consumers for just the former cost. Utilities were still in charge of the power lines and the electrical grid, but companies called retail electric providers, or REPs, could offer customers different electricity services at a variety of rates. In essence, the government took a step back and allowed greater freedom in the industry. This huge change in the Texas electricity business is what is known as deregulation.
How deregulation works
Wary that less reinforcement would result in unfair prices, deregulation phased into the industry gradually. In 2002, there were a number of large established companies that had a large body of customers. In order to give new, small companies a chance to compete with these economic giants, Bill 7 included a provision for setting rates. The price to beat, or PTB, was a set rate based on current market electricity rates in Texas. Old companies weren’t allowed to charge below the PTB, while new REPs were encouraged to offer consumers more competitive electricity rates. In Texas, budding businesses were given the opportunity to attract clients and competition in the industry flourished. By 2007, the PTB was retired since the open market was in full form.
What deregulation means for you
Now, Texans can choose to buy their electricity from an REP. These companies buy energy in bulk from generation facilities and are then able to offer you a variety of different services and rates. Simply put, instead of paying the rates set by your utility, you’re now free to shop for the best electricity rates. Texas companies are competing for your business by offering low prices. If you compare electric rates in Texas and retail electric providers side by side, you’ll be able to determine which prices and products will best benefit your business or household.
A revolution in energy
The advent of the Industrial Revolution caused a boom in factories and air pollution. To keep up with production and achieve a competitive edge, businesses and plants used more and more fossil fuels to power their facilities. This air pollution has come at a cost. Examining air quality and our atmosphere, scientists have determined that a surplus of carbon dioxide and other greenhouse gases is trapping heat around the earth. Unless humans change the way they harness energy, global warming could have dire consequences.
In the early days of the electricity industry, energy was mainly produced through the burning of fossil fuels, like coal and oil. These fossil fuels are inexpensive, but burning them resulted in an excess of greenhouse gas emissions. Plus, fossil fuels are in limited supply. With both of these problems in mind, scientists have developed new ways to generate electricity.
Thanks to deregulation, environmentally conscious consumers have the option of signing up for eco-friendly energy service. Many REPs offer electricity plans that are partially or entirely “green”. You can make sure that your money goes toward the production of clean energy or carbon emission reduction projects.
Knowing what options are available to you is the first step in choosing an electric company. Retail electric providers are offering residential and commercial products at a variety of electricity rates. Texas consumers should take the time to learn about the industry and how it affects your finances. Here on CompareElectricRatesInTexas.com you can learn about variable and fixed rates. You can also familiarize yourself with industry jargon and learn about traits possessed by different companies. The electricity business is complex and constantly evolving, but with a solid base of knowledge, you’ll be able to find a retail electric provider that meets all of your needs.