Fixed Electric Rates

by admin on February 5, 2009

A fixed residential electric rate means that the rate is locked in and will not change the entire term of the contract. Most Texas electric companies will lock in all fees and charges associated with the fixed electric rate. Occasionally the Public Utility Commission of Texas will tag on an additional fee like the most recent smart meter fee. The recent smart meter fee added about $4 on top of the electric rate charges you see on your Texas electricity bill. Since the Texas electric companies had no ability forsee this additional charge voted into the bill they could only pass it through on the bill and were not able to eat the loss.

There are a few disreputable electric companies that will advertise a fixed electric rate but will then pass through the TDSP pole and wires charges as if they had already mentioned them when quoting you a rate. The truth is that most electric companies fix the TDSP pole and wires charges into their energy rate to provide an “all-in” residential electric rate quote. This means that most electric providers in Texas happily disclose all charges associated with the electric rate in an all-in fixed rate that will not change.

The disreputable providers wil advertise a fixed rate and then tag on the TDSP charges later making you think you negotiated a much lower electric rate then you really did. Some providers will include the TDSP charge like the honest providers but will have a “fuel surcharge” in the fine print of the contract which allows them to adjust the “fixed rate” whenever they please. Since fuel price change in price daily they could change your electric rate every month if they wanted to. Now answer me this question, Why would you advertise your electric rate as a “fixed rate” if it has a fuel surcharge that allows the electricity rate to change? My answer is if you are a dishonest electric company and want to trick your customers into perceiving that your electric rate is lower then everyone elses when there is a hidden fee called the “fuel surcharge”.

If an electric provider in Texas wants to sell a fixed electric rate with a fuel surcharge to a residential Texas electricity customer that barely knows anything about how an electric contract works there needs to be a law created by the PUCT to protect the consumer from this loophole in the law that allows these electric companies to continue to trick the Texas energy consumer into a rate that is really too good to be true. Maybe spell it out in large letters on the literature of every contract page, on the terms of service, and on the facts label and require the sales people to explain it in a way that the customer understands or just outlaw this practice.

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