Retail electric providers in Texas’ deregulated market are offering residential rates that in many instances are lower than those of some municipal power companies, electric cooperatives and investor-owned utilities that are still under rate regulation, a Star-Telegram survey shows.
A decade after the Texas Legislature passed a law authorizing deregulation, retail electric providers compete intensely to win new customers. They have sharply lowered rates in response to a plunge in prices for natural gas, which is burned to generate much of the electricity produced in Texas.
Deregulation critics have frequently noted in the past that residential electric rates in the deregulated market were considerably higher than those charged by municipal power companies, called "munis," rural and suburban electric cooperatives and investor-owned utilities, or IOUs, in areas such as the Texas Panhandle and East Texas that are outside the deregulated market. But that price gap appears to be narrowing, the Star-Telegram analysis shows.
Many consumers in Dallas-Fort Worth and other deregulated markets have been entering into fixed-rate plans of one year or longer to lock in lower rates before natural gas prices bounce back, as energy analysts have forecast will occur once the economy rebounds and gas supplies tighten.
Other consumers have chosen low-rate variable plans in which the rates are directly tied to the current low natural gas prices. They include former state Sen. David Sibley of Waco, who has represented the Association of Electric Companies of Texas in Austin and was a prime sponsor of the state electric deregulation law passed in 1999.
Sibley declined to name his retail provider but said he’s enjoying a rate of less than 10 cents per kilowatt-hour. He said it appears that "a lot of people are switching" companies to get better deals while gas prices are low.
Read more at Star-Telegram.com