Energy deregulation in Texas causes Texans to have higher bills than the rest of the US

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According to recent reports in the energy market, Texans in deregulated parts of the state pay an average that surpasses the national average. These same Texas residents also pay higher integrated utility bills.

Texas Legislature gave birth to deregulation and a competitive market to most of it’s state in 2002, allowing residents to pick who they wanted and to compare rates at powertochoose.org.

Jay Doegey, executive director for Texas Coalition for Affordable Power, says,“Folks living in areas of Texas with electric deregulation have paid more for electricity, on average, than Texans living without deregulation — that’s just a historical fact. But it’s also true that the deregulated market is maturing. The good news for folks living in deregulated areas is that if they shop carefully, they can find plenty of individual deals with good prices.” Currently, there isn’t enough data available to properly compare 2015 costs.

The average costs fell below the national average in 2012-2013 due to the ample supply of cheap natural gas that drives power prices in Texas. That quickly ended in 2014 when the average was .04 cents higher than the nation’s average. The 15 percent of non-deregulated Texans pay less than 11 cents kwh.

The gap between the two markets totals $24 billion from the first 12 years, with an average of $5,100 per household. Reasons for the divide are kinks in the deregulated market, rate comparison confusion, and higher prices from the trusted “name brand” companies that were around before deregulation.

TDU charges have drastically shot through the roof since deregulation. CenterPoint Energy, who is responsible for the transmission and distribution in Houston, has increased monthly charges from an average of $24.61 in 9/03 to $42.41 in 3/16, all of this in addition to the fluctuating rates that change daily.

Article written by HEI contributor Marcela Abarca.

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