How do Texas residents afford electricity during high-demand?
How do Texas residents afford electricity during high-demand?
Whenever they have a spike in demand, the de-regulated prices go up by several hundred percent. Example
Energy pricing in Texas is managed for the benefit of the utilities, not their customers. Some of the people on non-fixed plans who got charged insane amounts just went bankrupt.
Texas is a nearly perfect example of how the Republicans think everything should work.
Close but not correct.
It's an established marketplace, where legislated "middlemen" buy from the utilities and then sell to the consumer.
You can't actually buy directly from the utility generating the power without going through the marketplace.
It is sold as a "free market" that would drive competition and keep prices down. In actuality, it just allows leaches, who don't actually produce anything, to sit in the middle and suck money out of the economy.
Sure some of them will lose money, while others will make a billion, but the system works just fine as a regulated controlled monopoly.
Texas is a perfect example of Republican hypocrisy. The Governor, Lt Governor, State AG, etc... are quite literally the worst kind of politicians.
I seriously dislike Sheila Jackson Lee, but I feel bad about her situation.
I would laugh if that wheel chaired, piece of shit rolled off a cliff.
I would laugh if Dan Patrick caught on fire.
On second thought, I might use Ken Paxton to put out the fire, by that I mean, push him onto Dan, hoping he would catch on fire too.
Shit, that went a lot darker than I intended.
Texas; where people with power make extra money for specifically not doing good enough.
That's some next level owning the libs.
I'm certainly feeling owned right now. Ouch!
Just like to point out that Jerry Jones (the owner of the Dallas Cowboys) made almost $1 Billion, with a B, during the big freeze because he owns the natural gas fields and his good budy Governor Abbot said that wholesalers must sell for the max amount as allowed by law during that time, basically legalizing price gouging.
If it's Republicans, it's legal.
Most residents aren't on these types of plans. The ones that are turn shit off, or pay through the nose.
Generally the ones that are on those plans are the most vulnerable. I've got a fixed TXU plan. The up front cost of being on it was a couple of hundred bucks because I had bad credit at the time. The pay as you go variable rate places don't have that up front cost and when it's not peak times they're significantly cheaper.
Unfortunately they don't always let people know in time when the rates spike. So these vulnerable people don't even realize they should be turning shit off or they're not home to do it or it's a heat wave/ice storm where they could just fucking die if they turn off climate control.
It's been a fucking mess down here in Houston. My electricity came up pretty quickly and I was able to head west and grab a hotel for a night so I didn't get heat stroke. I'm lucky. I was able to come back and eat the brisket I smoked before Beryl came through (I'm a stereotype, sue me). But there are people who still don't have electricity in this fucking weather and there are others who have to decide between their fridge and their AC.
I'm drunk, bitter, and pissed off tonight. So I'm gonna ramble.
Toss these guys a few bucks the next time your plan is up for renewal and see what rate you can get. Usually TXU is on the high side. https://www.texaspowerguide.com/
Drunk, bitter, and pissed off. That should be our state motto. Cheers!
Most of us don't pay the market price hour to hour. Our electricity provider absorbs the risk of price spikes and raises our rates if the math stops working for them.
Griddy was a provider that sells at the market rate, which is usually below the general price you would pay, but you take the risk of price spikes during peak demand.
I’ve done lots of tech projects within the retail energy industry in Texas - this is the right answer.
To expand a little bit:
Retail energy providers (REPs), like NRG, ClearSky, Just Energy, etc. make their money by forecasting the amount of energy that will be needed as far in advance as possible and purchasing that amount from power generators like CenterPoint and marking it up a few cents. The farther out, the cheaper they can get it. I’ve helped build forecasting engines for a few that ingest historical usage data from meters (all meters in Texas are smart meters), weather data, and others to use machine learning to forecast how much individuals will need and aggregate it together to help the energy traders make better informed trade decisions farther out.
If they mess up or an unforeseen event happens and they don’t have enough energy bought for that time segment (forgot the term for a window of time they use), they have to go to the spot market which is where the prices fluctuate and can be many many multitudes higher than the rate the customers are contracted to pay.
In a storm scenario or a freeze, it can be thousands of times more expensive because demand is so high and supply is so limited. This is when REPs go bankrupt if they don’t have the cash on hand.
There are also insurance plans that the REPs pay for that cover very specific conditions for different types of events or outages that can kick in to cover the huge costs they would otherwise incur on their own buying electricity at that spot rate. I’ve known a few that were only able to stay operating because someone a few years prior had bought an insurance policy that covered said weather event.
Griddy died because of the ice storm in Texas a few years ago and the huge costs people incurred. I actually met with their CIO the year prior as part of a technology assessment of their stack. Nice guy.
Edit: also you can largely thank Enron and Rick Perry for deregulating Texas’ energy - which directly led to the terrible “performance” of the Texas grid during the winter storm Uri in 2021. Same for Enron in the constant blackouts in California in the early 2000’s.
Griddy
Thank you! So much misinformation floating around, its ridiculous.
They don't
I thank my lucky stars to be in San Antonio where we have municipal power.
People complain about CPS (city public service) but we get a say in how the company is run and our bills are quite reasonable compared to the state average.
If they don’t have fixed rate, they’re in a pickle.
Source: sadly live in Texas
Yeah, they'll happily send you a bill without fixed rates as soon as they can
The article and comments here make me very happy to live in Quebec where the electricity is 0,067CAD per kWh for the first 40, then after it is 0,103CAD per kWh, and most of the time, that electricity is 100% renewable. In Québec we have many problems but the electricity is one big point to be proud of as a nation
A big part of that is it's all state owned. Having private companies in charge of something as vital and important as energy infrastructure is just pure folly imo.
Yeah 100%. the current government here has a tendency to do bad stuff and a big fear here is they will slowly make it more private owned. But I think that every essential service should be state owned. electricity, groceries, clothing, internet etc. We have too few companies here that share too much of the market
I like how my state does it. The grid is managed by a public utility, but we can shop around for providers. The utility handles the billing, and switching providers is super easy. I'm paying 9.5¢/kWh for 100% renewable energy, which is about 10% cheaper than the base rate I'd pay if I just used the utility.
$0.058 / kWh here in rural Oregon, it's pretty awesome.
Now do the exchange rate.
How much is your income taxed? ~60%, like the rest of Canada?
The last bracket which starts at 235k is about 58% (but there are many ways to put money aside to lower your income bracket). But don't lose our hair worrying if we will have to file for bankruptcy to get basic healthcare. In Montreal we have a top 10 world university that costs less than 1000$ per semester for citizens. We also don't have to worry about people carrying guns around. But go on I guess
Holy propaganda-muncher 😂
If you want to talk about taxes, include cost of your healthcare. Because that's included in our taxes.
Fun fact, America pays as much per capita for healthcare through taxes as Canadians, but that only gets you Medicare and Medicaid. Americans sure get angry about a lot of things, but I never see them get angry about that.
According to ChatGPT:
15% on the first $49,275 of taxable income.
20% on the next $49,275 of taxable income (over $49,275 up to $98,550).
24% on the next $19,170 of taxable income (over $98,550 up to $117,720).
25.75% on the taxable income over $117,720.
Bullshit.
I live in Finland and me like a large number of other Finns have a plan in which the price changes every hour according to the market price. Typical price for electricity is around 4c/kWh in the summer and around 15c/kWh in the winter. However it's not uncommon at all for the price to spike into 30c/kWh or even 70c/kWh. Last winter there was a day that it spiked to 200c/kWh.
How do we deal with it? By turning down/off the heating if possible and burning wood instead. If not then you just deal with it and have to pay significantly more for a few months. Then again if your plan has a fixed price to like 10c/kWh then that also mean you're paying that even when the price drops to zero which also is not uncommon at all. Often happens several times a week during the summer time. Sometimes it even goes into negative. It's still not literally free though since the transfer cost is around 6c/kWh plus energy fee and taxes.
How do you keep up with the current price? Does your thermostat have a setting where if the price is above X then turn off? Do you just come home to a freezing house and say "oh the electric is too expensive, guess I'll grab some wood"?
I check sahko.tk in the evenings to see if it's going to be particularly expensive the next day. This is mostly in the winter time, at summer I hardly pay any attention to it. They usually warn people in the news too for the handful of really expensive days in a year. Depending how high it gets I might turn off the heating for the peak hours but generally not because it doesn't really make that of a big difference as the prices average out over a long period of time. Some people have automatic thermostats that turn off the heating after the electricity price passes a certain limit. My water heater for example is set to go on during the night when electricity is at its cheapest.
So it costs you more when it costs more to produce, but when it's free to produce it still costs you money.
Love corporations
No.. First of all: electricity is never free to produce. Running a powerplant costs the same no matter what price the electricity is at. The price goes to zero when supply greatly overceeds demand. That means I'm not paying to the electric company for the electricity but I'm still paying for the company that maintains the grid to deliver that electricity to me. It doesn't just magically hop from the powerplant to my house.
That's the neat thing! They don't.
What's so neat about it?
sarcasm
Maybe it depends on your energy provider and whether you have a fixed rate or variable rate plan? I don't know if other places have those options or not. Check out powertochoes.org if you don't know what I mean. Mine just went up from $200 to $300 this month with the heat. My highest is usually 1-2 months of ~$350.
$350? 😭 ive never had an electric bill above $150
In the apartment I just moved out of, even after several complaints I had summer electric bills $600+ and it was still hot...night before I moved it was 91 outside and 89 inside. So far my new apartment is better but haven't seen any electric bills yet
Arizona here. My August service bill is the highest of the year, usually ends up around $425 or so with the thermostat set to ~76. January is usually the lowest, and I can get that down to about $75. Averages out to about $220/mo over the year. It's ridiculous.
I live in Wisconsin where it can get down to -20 before wind-chill in the winter and the heat index pushes 100 in the summer, plus our summers are basically always 100% humidity for months at a time. My house was built before the turn of the century (the 19th century specifically) and both my furnace and AC are on their last legs. With all that said, I get $250 bills in the summer months and it pushes close to that in the winter, but during the spring and fall when it's a lot more reasonable they can get under $100
They just make a lot of money or lived outside their means. When people mention big AC bills, they’re cooling 2000sqft homes to under 70F 24/7. No idea why American culture does this insanity.
I get by just fine with 78F during the day and a little lower at night, it even gets a bit cold when the compressor runs. Low low bills even when it’s 110 (not hyperbole, that’s the literal temp) outside.
Additionally every degree higher it gets outside, the less efficient your AC/heat pump gets so you need more power to hit the same temp even after accounting for the higher heat differential.
Vote. Shit won’t change if you don’t make yourself heard.
True! But Texan dems do vote, despite knowing that as long as a conservative is governor, the election actually will be rigged. In Texas, state elections are under the complete control of a conservative governor, as he appoints a loyal Secretary of State to handle his elections.
Are elections in Texas handled with transparency and honesty? Awwe heeelllllll no. They are handled the way you'd expect a conservative to run an election. With secrecy and a creepy little conservative grin. "Oh, you were so close y'all! Oh, well. Better luck next time!"
While I agree that Texans need to continue voting, it seems pretty obvious to me that pacifist methods cannot yield change against conservatism. Voting in Texas is like voting under Putin. Voting is good, but it's not what is going to cause a regime change. Only severe and widespread action can have any effect against the deadly cancer of conservatism.
We were only 600,000 votes away from a Biden victory in 2020 because we didn't have enough voters. TX has pitiful voter turnout, even with 2 weeks if open polls, with polls required to be open at least 12 hours a day on the weekday.
In 2020, even with what's called amazing turnout, with a voting age population of 21.5 million, 17 million were registered, and 11.3 million cast a vote. Then in 2022, when we had the entire legislative branch, almost all of the executive branch, and a good chunk of the judicial branch up for election, only 8.1 million people voted.
Even with these numbers, Biden still received more votes in TX than he did in NY! There's potential for us to get some better representation, if we can just get more people to get to a polling station (usually open 7AM-7PM during the second week of voting).
We need more people to turnout this year, not only to keep Trump from our electoral college votes, but to kick Ted Cruz to the curb. There is a lot in the news pushing people away from the pills and making people mad at the DNC just like in 2016 and its really scary because those tactics helped keep people from casting their vote.
Turnout number source https://www.sos.state.tx.us/elections/historical/70-92.shtml
We have contracts like everyone else. No one pays the day by day rate.
Then what’s the point in having a day by day rate?
It's the same reason why the fed controls interest rates. Entities higher up the chain deal with those volatile costs so we don't have to.
Because that’s what the electric company is paying, and if it stays high our contracts go up next year
More questions here than answers, unfortunately.
It's my understanding that there is a cap at $5000/MwH ($5/kwH). That is still hella expensive, but would only be for a day or two at maximum?
For the headlines of +$16000 power bills, that is probably a one-off for heavy power consumers, like businesses that have massive freezers and such, correct?
Not correct.
I have coworkers in Texas that got hit with multi thousand dollar bills during brown outs.
Deregulating critical services never ends well for the consumer.
I have a friend from high school that got hit with a something like $20,000 bill because he signed up for some discount program on his electric bill. The freeze a couple years ago did similar things to demand and he got hit with a massive bill.
there is a cap at $5000/MwH
It's MWh (megawatt hours). That's only for wholesale electricity, which is available to retail electrical providers, not consumers. So your utility company can charge you whatever they want, but their price is capped. Funny how that works.
More info about the cap specifically available here. (PDF)
Ok, that clears up my misunderstanding then. I was thinking that the cap applied across the board. (That does change things a bit, don't it?)
A properly insulated industrial freezer should consume less electricity than a house with AC, even if it's set at a reasonable temp.
TIL. It makes sense that they can be more efficient now that you pointed that out.
I'm curious as to how this would compare to a properly insulated home?
most the houses in texas are uninsulated to keep construction costs down. (despite the fact that even a minimal amount of insulation would pay for itself inside of a year or two.) (Why would you want to insulate against heat, right? global warming is a woke-ist hoax! /s)
They pay their savings directly into the pockets of bought politicians and corrupt energy execs.
By living in an area that has a regulated utility provider. One of the primary requirements I have when choosing a place to live is to make sure the utility provider in the area is a regulated entity.
I find it highly unlikely that a human being is deciding their living situation based on whether or not their utility provider is regulated.
Well I did, so shrug I guess I’m an outlier. My home search was very limited to one county so I could make sure we were covered by that city’s resources. Besides, I didn’t say it had to be the only reason. Just answering OPs question on how people live with those private unregulated utilities, which I did by avoiding them altogether.
By eliminating nonessentials like food.
Power companies average things out.
Now some customers specifically ask to pay the instantaneous price, and those people just turn things off. This has the advantage that you end up paying less during times if low demand.
I live in Texas. Our electricity delivery is quite complicated. I moved here from California where our only choice was to have PG&E or no power. We paid what they told us to pay, and we said, "thank you." It was simple. But in Texas, you have different choices for power companies. Where I live, I have about a dozen or so choices for companies, and each one has multiple pricing schemes. So you could have a pricing scheme that is a flat rate, or you could have ones that have time-based tiers, or usage tiers, etc. I'm sure someone offers a pricing scheme that roughly follows the market prices, but honestly you'd be dumb for choosing that one. Most people go with tiered usage ones because they appear to be the lowest prices. So you pay based on how much you use, but the more you use, the more you pay.
I have solar panels, and when choosing a power plan that works best for that, I did see many that purchased your excess power based on the market price. Usually it was like some percentage of the market price, not 100%. However I ended up going with a time-based pricing scheme where my power is free between 9 PM and 7 AM, as my solar panels and batteries cover me for the rest of the time. I essentially pay nothing for power, and I have an electric car, electric dryer, and electric oven.
I live in California, and I’ve been on SDG&E, PG&E, and SoCal Edison, and they all work the same as what you’re describing, with multiple different pricing schemes depending on usage and hours. Wherever you live in California, you usually only have one company to choose from, but I’ve never had only one plan to choose from. Maybe you lived in a very niche part of California, but that’s definitely not how it works in San Diego County, Riverside County, Santa Clara County, San Mateo County, or Alameda County.
As far as solar, that’s the same everywhere. My dad is on SDG&E, and he sells his solar back to the grid when he doesn’t use full capacity.
In my thirty six years in California, I’ve experienced a handful of blackouts. The last one was in 2012. How often does Texas have blackouts? I remember most of the state going dark just a few years ago. And now again. It may not be all of the state, but it’s enough that it’s newsworthy.
I live in Texas and lose power for more than a day 2-3 times a year. It's July and I've already lost power (for more than a day) at least 3 times this year so far. Generators are extremely common here. Newcomers learn that lesson the hard way.
Sometimes it's only out for a day and sometimes it's out for 10 or more days. Power companies don't do preventative maintenance in Texas because power companies are unregulated here. It is more profitable for them to wait for something to fail and slowly fix it rather than replace what hasn't broken yet.
In fact, power companies base their trade pricing on availability, so widespread outages are extremely profitable for them, as they can claim there are shortages where there are not. There is no mechanism to prevent this. And since the governor's campaign is paid millions of dollars a year by power companies, they are in control of their own "oversight".
As long as conservatives are in charge in Texas, this cannot improve. It can only become worse.
Before a few years ago, we basically never had major backouts. That snowpocalypse really kicked things off.
Same, stuck with tiered on SCE and it worked reliably and at reasonably low cost.
With free power overnight, do you charge the batteries up to full before 7AM?
I don't. When I installed my solar panels and batteries there was a stipulation that if I charge my batteries from the grid, I don't get a tax rebate. Essentially they gave me $10,600 USD for me to not do that. If they catch me doing it, I would need to pay that back. However there is an exception for inclement weather. If there is a severe thunderstorm, fire, etc. in my area, my batteries are automatically charged from the grid.
I'd be shocked that anyone puts up with this, but then I remember how the healthcare system "works."
Hopefully getting their own solar panels
I hear you, but a solar set up with batteries for a house in TX is often well over $100K. It's not easy for most of us to pull that off, even with financing. And it's not an option at all for renters.
$100k
that’s ten times what it costs to install domestic solar, battery storage across all of Europe including major cities. Why is it so expensive? Panels are ~$200 each online and an inverter is $5k for a really good one.
A quick google search shows prices more in line with my expectations (sources: https://www.forbes.com/home-improvement/solar/solar-panel-costs-texas/ and https://www.energysage.com/local-data/solar-panel-cost/tx/)
Those are the wholesale prices to the utility company itself from the grid operators, not the prices to end users from the utility company. End users pay a flat amount per kWh that does not change by demand.
Most of us do. A few people do sign up for variable rate plans, and they did get astronomical bills during the snowpocalypse. IIRC they didn't get any aid or anything, it was a small enough number of people that they just got hung out to dry.
Wholesale or Retail? I couldn't read the article.
Donebrach deleted their comment :(
Get a hotel room like any adult man does when he is hot and bothered...
🤣