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Sep 10

Texas Energy News and Abilene TX Electricity Rates

ABILENE, TEXAS - September 10, 2022 - Texas Electricity Ratings

Abilene Electricity Rates Have Doubled and With No Relief in sight

High natural gas prices are putting a strain on Abilene-area pocketbooks. Texas energy analysts predict that there will be more pain.

Analysts say that Texas homeowners have the highest electricity rates in 13 years. This is about to get worse.

New contracts for electricity are being offered at prices that are near record highs by electricity providers. The perfect storm of conditions is converging that could lead to this summer being the most expensive for electricity in Texas history.

ERCOT has reported that 46 percent of Texas is powered by natural gas. Natural gas prices have tripled since the U.S. war in Ukraine. They are even higher in Europe. US natural gas prices will be more affected by the pressure to import more gas into Europe.

As you can see, the summer heat has risen faster than normal as we have witnessed over the past 2 weeks. Texas's hot summer days increase electricity demand. Wholesale electricity prices have risen due to high demand.

But there's more.

NOAA expects "a 70% chance" of 14-21 hurricane-type storms this year. As many as ten could potentially become hurricanes. These storms could grow to be major hurricanes. "NOAA has reported that this year's hurricane seasons will be "above-normal." Peak hurricane season runs from August to September.

Electricity providers are being cautious because of uncertainty in the energy markets.

The futures market also signals no immediate relief from higher prices.

Futures prices for wholesale power two years from now are much lower than what is forecast for next month.

Electricity is typically priced in 12-, 24-, and 36-month increments in wholesale markets. The rates will tend to stay the same if natural gas prices don't drop.

Everything is linked to the price of natural gas.

Natural gas is almost always used to meet the demand for power during power surges.

This is yet another reason why natural gas prices are so high

Texas electricity providers are considering the high natural gas prices and the potential for a significant rise in future prices.

For those consumers who were lucky enough to have signed a multi-year contract for as little as 8 or 9 cents a kWh six months ago, they won't have to worry in the short term.

Other people without a contract or with a renewal contract are eligible for residential rates at 15 to 18 percent right now.

Many providers are no longer offering new signups because it is not financially viable.

Prices are much higher now for 12-month contracts than they are for 24- or 36-month contracts due to current price pressure.

Customers without an existing energy contract have two options: either continue with a month-to-month plan in hopes of getting a lower price for a 12-24 month term contract or opt to lock in higher rates for a longer-term plan.

The current volatility in natural gas wholesale prices accounts for the majority of price uncertainty. Price relief is unlikely to occur until Europe has stabilized its situation.

To shop for the best Abilene energy rates available from the best energy providers, visit TexasElectricityRatings.com.

Texas Energy News and Abilene TX Electricity Rates

Texas Electricity Ratings

Texas Electricity Ratings
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