in Houston, Texas
How unregulated is Texas electricity? Commission considers price increase
Friday, May 18, 2012, 11:48AM CST
By Mark Lisheron
electricity

The electricity generation industry in Texas some insist on referring to as deregulated is facing a price increase ordered by the regulatory Public Utility Commission.

The three-member commission, meeting today in Austin, thinks it ought to impose an increase on customers to encourage this unfettered business to build more power plants, according to a story in the Fort Worth Star-Telegram.

Donna Nelson, chairman of the PUC, has supported raising prices as early as this summer as a hedge on the rolling blackouts that have occurred on peak generation days. Prices going up this summer will not help to meet demand this summer, they will simply deliver huge profits to the free marketeers in electricity, Commissioner Kenneth Anderson, says.

The story goes on to remind Texans that Senate Bill 7 passed in 1999 allowed power companies to set their own prices for electricity and allowed customers to shop for power and the price they wanted.

Unless the Public Utility Commission sees otherwise. The Electric Reliability Council of Texas, manager of the power grid in 75 percent of the state, also has the authority to control the wholesale price of electricity to inhibit the spiking of electric rates during times of high power demand.

Like most everything involving the role of government in our lives, some, like the conservative Texas Public Policy Foundation, contend that deregulation has been good for Texans. Others, like the liberal consumer group Public Citizen Texas, thinks deregulation has been a disaster for those same Texans.

Supporters say deregulated electricity is cheaper than it was before Senate Bill 7 passed. Detractors say it depends on how you’re figuring.

The Energy Information Administration says Texans pay an average of 11.3 cents a kilowatt hour, less than the national average of about 12 cents.Texas ranked 31st among the states in average cost, better than Illinois (11.7) and Florida (11.7) and much better than California (15.2) and New York (18.1).

Should that average go up a little or a lot depends on what the Public Utility Commssion thinks is best. But for heaven’s sake, don’t go calling it regulation.

***
Contact Mark Lisheron at 512-299-2318 or mark@texaswatchdog.org or on Twitter at @marktxwatchdog.

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Photo 'Power Lines' by flickr user Theodore Scott, used via a Creative Commons license.

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