Author Archives: admin

Jan 24

Potential TXU Class Action Lawsuit Alleges Customers Were Over Charged

Posted on by

DALLAS–(BUSINESS WIRE)–Watts Guerra Craft believes that TXU and/or its affiliates may have knowingly overcharged certain residential electricity customers at commercial rates. TXU’s rate-overcharging practices may have affected thousands of unsuspecting Texas residential electricity consumers.

TXU was sued in a class action lawsuit brought in Travis County by owners or management companies of multi-family or housing dwellings/complexes located in TXU service areas, who were charged under a residential or “Business Classic” rate and were assessed sales taxes on electricity provided by TXU for any billing period after July 1, 2002. Thomas Crowson v. TXU Energy Retail Company LLC f/k/a TXU Energy Retail Company, LP, No. D-1-GN-07-003901, in the 126th District Court, Travis County, Texas. TXU later entered into a Stipulation and Agreement of Compromise and Settlement that settled that action.

Currently, Watts Guerra Craft believes that TXU may be subject to an additional lawsuit with regard to rate overcharges, as a different group of potential plaintiffs, residential customers, may have been overcharged in a different area of Texas.

 

Read More

Aug 17

Texas Electricity Generation by Primary Energy Source in Megawatthours – 1990 Through 2010

Posted on by

Texas electricity is increasingly being sourced by cleaner energy sources.  The data below is from the U.S. Energy Information Agency.

1990 2010 Percentage Share
Total Electric Industry 1990 2010
    Coal 120,921,396 150,172,832 42.9 36.5
    Petroleum 1,827,803 708,481 0.6 0.2
    Natural Gas 136,234,325 186,882,238 48.4 45.4
    Other Gases 2,997,509 3,290,570 1.1 0.8
    Nuclear 15,859,258 41,335,248 5.6 10.0
    Hydroelectric 1,793,625 1,261,832 0.6 0.3
    Wind & Other Renewables 1,436,988 27,704,828 0.5 6.7
    Other 488,731 339,017 0.2 0.1

EIA Data

Aug 16

Prepaid Electricity Catching On in Texas

Posted on by

Pre-paid electric plans are becoming more and more popular in Texas because they work well for both consumers and providers.

Retail electric providers are in the business of managing risk.  Specifically, they must manage rate risk and default risk.  Wholesale electric rates in Texas are not fixed.  They fluctuate substantially hour-by-hour depending on the current demand for electricity and the current supply of available power in the grid.

Retail electricity providers sell fixed rate plans to consumers with terms of anywhere from six months to up to as much as 36 months.   That means if there is a short term jump in electricity rates they are not immediately able to pass the cost increase along to their customers because they are bound by the customer contracts.  They must factor in adequate margins when they price their fixed rate plans to consumers to protect themselves from that risk.  They also use hedging strategies to protect themselves against sudden jumps in electricity rates.

Another major risk is called default risk. Basically, this is the risk of electricity consumers not paying their electric bills.   In this event, not only does the electricity provider not get paid, but they still have to pay the producers of the power regardless of whether the customer pays their bill.  Because of this many electric providers require either high credit scores or a deposit.

The theory is that poor credit scores mean a higher risk of default when it comes time to pay the electric bill.  Prepaid electricity plans are often the best choice for credit challenged consumers because they require no credit check.  They also offer the flexibility of month-to-month no contract electricity.

Jul 12

Texas electricity rates 2012 thru 2002

Posted on by

A recent look at Texas electricity rates 2012 thru 2002 show that rates are essentially the same today as they were a decade ago when inflation is taken into account.

Many consumers are hedging themselves by choosing longer term electricity plans, such as the 24 month plan offered by Champion Energy. The plan is currently the cheapest electricity in Houston for the 24 month time period. The TriEagle Eagle 24 plan is among the best Dallas electricity rates right now for 2 year contracts.

Actual Rates (cents per kWh)1 Inflation Adjusted
Period U.S. Texas U.S. Texas
Q1-2002 6.96 6.81 8.89 8.70
Q2-2002 7.18 6.6 9.17 8.43
Q3-2002 7.55 6.73 9.64 8.59
Q4-2002 7.04 6.33 8.99 8.08
Q1-2003 7.07 7.02 8.83 8.77
Q2-2003 7.5 7.76 9.37 9.69
Q3-2003 7.87 8.06 9.83 10.07
Q4-2003 7.24 6.96 9.04 8.69
Q1-2004 7.26 7.28 8.84 8.86
Q2-2004 7.59 8.02 9.24 9.76
Q3-2004 8.09 8.59 9.85 10.45
Q4-2004 7.46 7.71 9.08 9.38
Q1-2005 7.54 7.92 8.87 9.32
Q2-2005 7.98 8.69 9.39 10.23
Q3-2005 8.66 9.81 10.19 11.55
Q4-2005 8.26 9.88 9.72 11.63
Q1-2006 8.41 9.99 9.59 11.39
Q2-2006 8.88 10.37 10.12 11.82
Q3-2006 9.49 10.86 10.82 12.38
Q4-2006 8.69 9.96 9.91 11.35
Q1-2007 8.75 10 9.70 11.08
Q2-2007 9.1 10.2 10.08 11.30
Q3-2007 9.59 10.31 10.63 11.42
Q4-2007 9.01 9.88 9.98 10.95
Q1-2008 8.96 10.05 9.56 10.72
Q2-2008 9.68 11.04 10.33 11.78
Q3-2008 10.5 11.83 11.20 12.62
Q4-2008 9.74 10.81 10.39 11.53
Q1-2009 9.68 10.23 10.37 10.96
Q2-2009 9.83 9.97 10.53 10.68
Q3-2009 10.23 9.9 10.96 10.60
Q4-2009 9.48 9.35 10.15 10.01
Q1-2010 9.4 9.44 9.91 9.95
Q2-2010 9.84 9.42 10.37 9.93
Q3-2010 10.35 9.5 10.91 10.01
Q4-2010 9.62 8.95 10.14 9.43
Q1-2011 9.61 8.99 9.82 9.19
Q2-2011 9.98 9.11 10.20 9.31
Q3-2011 10.52 9.62 10.75 9.83
Q4-2011 9.74 8.84 9.95 9.03
Q1-2012 9.63 8.72 9.63 8.72
1 – Average across all sectors
May 25

Cost of Electric Vehicles

Posted on by

One of the best reasons for buying an electric vehicle is all those gallons of $3 or $4 gas you won’t be paying for. There is a certain sense of freedom that comes with knowing you won’t have to be tied to the gas pump. And think of all the money you’ll save!

Or maybe not…

Some people may save a lot of money by choosing an electric vehicle over a gas vehicle. Others may save little or none. The question of how much money you will save, if any at all, is actually pretty complicated. Here are the factors you’re going to need to consider.

A fair warning if you are going to try to answer this question; the math can get a little tricky. This online electric vehicle cost calculator will make the number crunching a little bit easier for you.

  • What is the fuel efficiency of the vehicle you are giving up to buy your electric vehicle? Are you passing up a 14 MPG, gas guzzling, 2005 Chevrolet Tahoe or a 28 MPG 2008 Ford Focus that sips gas with its pinky extended?
  • What is the price for gas in your area and what are your expectations for gas prices in the future? $4 a gallon? $5 a gallon? $3? At $3.50 per gallon your fuel cost for that Tahoe is $0.25 per mile. For the focus it’s more like $0.13 per mile.
  • What is your electricity rate? Depending on where you live in the U.S. you may pay anywhere from 7 cents per kilowatt hour to 16 cents per kilowatt hour. The cheapest electricity in Texas is about 8 cents per kwh. Many areas are starting to implement pricing based on time of day. This is good news for EV owners since overnight rates are typically the lowest rates of the day because demand drops dramatically at night.
  • What is the kilowatt hours per mile of your electric vehicle? This concept may be a bit foreign for most people at first. Rather than thinking about how many miles a car can drive on gallon of gas (MPG), EV drivers must be concerned with how many kWh of electricity are required to drive a mile.

If you assume a kWh per mile of .30 (a reasonable assumption for the Nissan Leaf) and a middle-of-the-road cost of $.10 per kWh for electricity you arrive at a cost per mile of $0.03 for electricity compared to a cost of $.13 per mile in gas to drive a 2008 Ford Focus. It seems like a no-brainer to go with the electric vehicle.

Battery Cost

But, as is often the case in life, things aren’t that simple. There is a second component to the fuel cost of driving electric that you must include in the cost. The batteries that power electric vehicles are quite expensive and they don’t last forever. So if you want to be thorough in your cost analysis you will need to make room for two more variables in your equation.

  • What’s the lifespan of your EV battery? There is not yet enough real world data to say anything definitive about the true lifespan of the current generation of lithium ion batteries. However, the Nissan leaf battery has a 100,000 mile warranty.
  • What’s the replacement cost of your battery? When your EV battery does eventually succumb to old age it will no longer hold a sufficient charge to power your vehicle. Then you have to buy a new one. Like most technologies, the cost of these batteries is expected to go down with time. It’s hard to know exactly what it would cost to replace it in 5 or 10 years but a reasonable estimate may be $8,000.

Putting it all together

So what does the final math show us? Well, once again the answer will depend greatly on your assumptions. But middle-of-the-road assumptions give us this answer.

Electricity cost per mile: $.03

Battery cost per mile: $.08

Total electric vehicle cost per mile: $.11

Gas cost per mile: $.19

Feb 01

Electricity Provider Austin Energy Seeks a Rate Increase

Posted on by

Consumers are pushing back as Austin electricity provider Austin Energy seeks an increase in the base electricity rate charged to Austin area consumers.

Unlike elsewhere in Texas, customers of Austin Energy don’t have a choice in electric providers. The rate hike is meeting opposition from many who are asking why rates in Austin are going up while electricity rates in Texas have been going down substantially in deregulated areas.

Many Austin Energy customers who live outside of the city are also asking why they are subsidizing the city of Austin who receives payment from Austin Energy for non-energy related expenses.

Jan 22

Biofuel and Texas Electricity

Posted on by

Electricity rates will only continue to head north for a lot of years to come making alternative forms of energy all the more important for meeting our future power needs. Our will need for fossil fuel derived electricity has come at a big cost to our ecosystem. Thankfully in recent years funding from governments, universities and forward-thinking power firms has led to breakthroughs in energy technologies that could bring about the implementation of highly efficient, environmentally friendly methods of powering our electricity needs. One of the promising technologies currently being studied is algae energy. Algae is grown all any place on the planet and there’s no practical limit to the quantity which will be grown.

Roughly half of algae’s weight is comprised of lipid oil which can be converted into biodiesel a fuel that burns clean and more effectively than petroleum. The key to generating energy from algae lies in the lipid oils that comprise almost half of the algae’s biomass. These oils can be converted to biodiesel which is cleaner and burns more efficiently than petroleum. This could replace any fuel that is burned to produce electricity. Algae can be grown anywhere provided it has access to carbon dioxide water and sunlight. There’re thousands of types of algae but it’s the pond scum form of algae that shows the most promise for being converted efficiently into biodiesel. Even better, the parts which might be not converted to biodiesel are suitable to produce fertilizer and feedstock.

Big corporations are slowly beginning to get on the bandwagon in researching algae’s possibilities as an energy source. A lot of the present research into algae as a fuel source is being funded by private corporations, not by governments or universities. Many proponents of algae as a bio-fuel source are frustrated in the lack of funding and attention directed at this by public institutions. For many the pace of research is frustratingly slow. They believe that there is an underappreciated opportunity to get out from under the heavy weight of oil dependence. Unfortunately oil is a big industry and it is still profitable for big oil companies to squeeze every last drop of profit from this venture before leaving it entirely.

Current shortages have driven oil prices up and continue to do so. Any business that has the opportunity to earn the same or more profits from having to handle less product will do so. The past century has been one of tremendous prosperity for human society. Such prosperity would not have been possible without the discovery and exploitation of fossil fuels. But this period in human history must eventually transition to one fueled by sustainable energy technologies. Because algae can be grown in every corner of the globe it has the potential to be a great equalizer when it comes to the geopolitical implications of energy. Today’s model of extracting fuel from one place in the globe and shipping it thousands of miles across oceans could be transformed to one of local production of algae to produce electricity and transportation fuel. This would mean more jobs in places where economic opportunity may be lacking today.

Using algae as biodiesel would have positive benefits for everyone.

Jan 09

A challenging year is predicted for the Texas electricity grid

Posted on by
Texas electricity rates

Texas electricity

ERCOT recently warned that a shortfall in the amount of electricity needed to support Texas electricity consumers in times of highest demand is likely. There are two trends leading to the anticipated troubles of the grid. There are multiple electricity plants that will be closing down in the near future and still others who will be delayed in coming online for the first time. The demand-side, on the other hand, will continue to increase particularly if the Texas economy continues to improve.

Texas consumers have already felt the impact of a loss in electricity capacity. In 2011 some 6 MW of electricity capacity was lost due to plant closings. The result was rolling blackouts in February. The problem was made worse when freezing temperatures caused mechanical failure at several power stations. Texas had to take the unusual step of importing electricity from the Mexican electricity grid.

ERCOT has taken steps to try to prevent a repeat of February 2011 when the grid was unable to meet demand and was forced to implement targeted blackouts. Working with the PUC they are seeking to update rules to allow for greater participation of contingent electricity sources in the event of an electricity demand emergency.

ERCOT is so concerned about the capability of the electricity system in Texas to handle peak demand that they have taken some unusual steps. They have approached the state’s transmission operators and asked for a thorough top-down review of current projects that are expected to be plugged into the grid over the next year. They need to have assurances that the assumed completion dates for projects that will begin feeding the grid are accurate. ERCOT’s chief executive cited new EPA rules among other factors as reasons why there is no margin of error when it comes to planning out the available capacity of the grid over the coming year.

ERCOT is being squeezed from all directions right now. The Texas electricity grid is being impacted by unusual weather conditions, new EPA rules, and a challenging economic background. 2011 will be remembered in Texas for weather extremes the likes of which have not been seen in living memory. Weather challenges faced by the Texas electricity grid started early in the year as February saw an ice storm that effectively shut down transportation and kept Texans in their homes where they switched on their heaters and demanded record electricity output from the grid. The record demand along with weather-related failures at certain key points in the power generation infrastructure forced ERCOT to implement controlled blackouts.

The pressure on the gird didn’t let up as the summer brought a near record string of 100 degree days. Once more, the Texas electric system skirted on the edge of capacity. In addition to the extreme temperatures, 2011 is also notable for the continuation of an historic drought in Texas as wells as unrelenting wildfires.

The troubles brought about by this unprecedented string of weather hardships are only compounded by the impact of EPA rules that have recently been announced. Many electricity plants will be closed down because the operators will not find it economically viable to update them to meet the new EPA rules. As the electricity grid struggles to meet demand these otherwise operational plants will be going dark. This is far from just a Texas problem. Concerns about how the rules will affect the reliability of the North American grid are being raised by the very group who is in charge of maintaining the reliability of the grid, NERC. The logistics of closing down many hundreds of plants even temporarily over a short time span are problematic.

Nov 25

TEXAS ELECTRICITY AND TXU NEW DEAL

Posted on by

TEXAN ELECTRICITY AND TXU NEW DEAL IN VOGUE-BOON FOR
ELECTIC VEHICLE OWNERS AND THE BUDGET-CONCIOUS

A summer heat wave alerted TXU to just how willing Texas were to reduce electricity usage during peak hours to voluntarily relieve strain on the state’s power grid. With that in mind, Nancy Perry, senior vice president of sales and marketing assessed that residential customers would be very willing to change their energy habits in exchange for financial savings.

With that in mind they instituted a new Electricity Plan called TXU Energy PowerSmart PM 24(SM), which is three-tiered and centered around the structured usage of
electricity during nighttime, peak, and off-peak hours. The plan implements
deep discounts for nighttime electric use. The plan even makes sense for solar
paneled homes, which typically produce their own electricity during peak hours.

However, with nighttime being the most advantageous for working class America, greater savings for the consumer would come from altering their basic behaviors and
doing electricity-rich activities such as running the dishwasher, doing
laundry, running swimming pool pumps, and charging electric vehicles at night.

“We’ve structured the new plan so that more than 90 percent of the hours in a year are
off-peak or nighttime hours, and we’re giving customers a lower rate for using
electricity at those times. “ This according to Nancy Perry, senior vice
president of sales and marketing.

The TXU PowerSmart PM 24 (SM) plan is available to residential customers who have a smart meter installed at their residence, and who live in Oncor or CenterPoint
service areas. Marketing reps stress that only a change in law or regulatory
changes can alter the guaranteed price protections built into the 24-month
plan.

Electric Vehicle owners will find this type of plan to be of enormous benefit, as deep discounts on nighttime electrical dollars when most consumers end their work day will
make perfect complimentary sense and savings.

The TXU plan also makes electric powered vehicles much more economical and therefore accessible to the American consumer. Since most owners would charge electric vehicles at night anyway, a plan such as PowerSmart would greatly increase the vehicle owners savings on the electrical dollar. That information comes from
Russ Kenne, president of Plug-In Texas coalition.

Any incentive that spurs EV adoption is a win all around. In addition to curtailing an
individuals gasoline expenses, electric vehicles can improve the state’s air
quality and reduce the nations dependency on foreign oil.”

Thus as Texans we can see that this type of new deal plan when implemented statewide would benefit everything from the residential dollar to the state environmental
and oil exports. Texans should give it a careful glance.