Texas Electric Customers: Why You May Be Paying More Even as Prices Go Down

by admin on April 8, 2010

Remember a couple of years ago when gas prices were $4 and $5 per gallon. We understood this when the price of a barrel of oil was escalating at the same time. But, as oil prices came down and gas prices stayed the same – and in some case kept going up – it left many consumers scratching their heads, exclaiming . . .

“Why is the cost of gas so high when the price of oil is going down?”

Makes no sense, right?

Well, this helps to explain why you may be paying too much for electricity, even as the price of natural gas – which powers most of Texas’ electricity – goes down.

Texas deregulated its electricity market in 2002, which caused many new energy companies to come on the scene and vie for consumer business. While some electric suppliers lure customers with initial discounts, many don’t. They may offer a high rate in hopes that you’ll take it. And many customers do. Why?

Because they may be disgruntled with their current electric company. Or, they may be moving and instead of paying a required deposit, they’ll sign up for a prepaid electric service account. These types of accounts routinely cost consumers more than a traditional electric service plan.

In fact, say energy experts, prepaid electric service account holders pay on average of two to three times what other consumers are paying per month. So even though Texas electric rates may be going down, you may still be paying a higher rate.

To ensure that you don’t, do some comparative shopping. Conventional electric companies have many plans to assist consumers in lowering their monthly electric bills, like Texas’ LITE-UP program. It offers discounts to consumers five months out of the year. Ask your current electric provider for qualifying details.

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