In the spring of 2009, Richard Bennett was frustrated with high electric bills for his 2,700-square-foot home in east Fort Worth.
His monthly bill had run as high as $596, and no wonder -- Reliant Energy was charging him 14.8 cents per kilowatt-hour.
But his electric bill "is not one of my concerns now," said Bennett, who switched from Reliant last year. He now has a rate of 9.2 cents with Champion Energy on a one-year contract that began in June.
Bennett's highest bill this past, scorching summer was $254. A retired Bell Helicopter Textron researcher, he has a Ph.D. in mechanical engineering and uses his math skills to analyze electricity costs and track rate trends.
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Not everyone is so attentive. Many Texans pay much higher rates than necessary, and many have never switched retail electric providers (REPs). But now is an excellent time to shop for a lower-rate plan, with rates dropping dramatically the past two years as a result of depressed natural gas prices.
There are one-year fixed rates available that are below what most North Texans were paying just before the majority of the state's electricity market was deregulated nearly nine years ago, on Jan. 1, 2002.
On Thursday, the website overseen by the Texas Public Utility Commission, www.powertochoose.org, listed these offerings:
Nineteen one-year, fixed-rate plans below 9 cents per kwh, including two at 8.4 cents, six at 8.5 cents, three at 8.6 cents, four at 8.8 cents and four at 8.9 cents.
Six two-year fixed-rate plans at 9 cents per kwh.
Fourteen all-renewable energy, one-year fixed-rate plans below 10 cents, ranging from 8.8 cents to 9.8 cents per kwh.
The 12 cheapest rates were for variable-rate plans priced from 7.1 to 7.9 cents per kwh. But variable rates can change from month to month, and some of the cheapest variable rates are one-month promotions that can escalate dramatically in the second month.
Shortly before retail deregulation began, Dallas-based TXU Corp., the dominant electric utility in North Texas, was charging a retail rate of 9.7 cents per kwh. It was required by law to lower that to 8.3 cents effective Jan. 1, 2002, the date deregulation began.
TXU Corp. was renamed Energy Future Holdings, or EFH, after the company was acquired in 2007. TXU Energy, a retail electric provider in today's deregulated market, is a subsidiary of EFH.
Today's cheapest one-year fixed rates are also lower than some municipally owned electric utilities and cooperatives, which are exempt from deregulation. In April 2007, when the Star-Telegram published an in-depth story on electric rates, "munis" and co-ops had markedly lower rates than the deregulated REPs.
Today's low deregulated rates are the result of weak natural gas prices, said John Fainter, CEO of the Association of Electric Companies of Texas.
The price of electricity from natural gas-fired power plants, a major source of supply in the Texas, drives pricing in the state's deregulated markets. In the summer of 2008, gas prices shot above $13.50 per million British thermal units, contributing to sharply higher electric rates that in many instances exceeded 15 cents per kwh.
Now gas is selling for less than $4 per million Btu, the result of oversupply, spurred by rising U.S. shale-gas production from fields like North Texas' Barnett Shale, and weak demand in a slow economy.
That has sharply lowered wholesale prices for electricity, enabling REPs to lower their rates. In September, the average wholesale price was $35.75 per megawatt-hour for the power grid operated by the Electric Reliability Council of Texas.
The average price was $42.14 for the first nine months of the year, far below the average price of $77.19 for all of 2008.
Strong competition in the deregulated retail market has also been a factor in producing today's lower rates, with dozens of REPs offering a variety of plans.
Jack Z. Smith, 817-390-7724