Houston-area Residents Paying more for New Electricity This Summer
As summer officially starts, cranking up the AC will cost Texans more this summer if they have to find a new
The average new 12-month electricity plan is roughly 6 cents more per kilowatt hour. Basically a 35% increase. To put that into context:
- A Houston-area customer using 2,000 kWh per month would have a bill that’s roughly $120 more expensive this June than last (1,000 kWh would be $60 more)
What’s caused this change? In Energy Ogre’s latest blog they describe where there are points where retail electricity providers are having to buy wholesale electricity at more expensive rates, and that then means the plans they can offer customers are also more expensive. There’s a pinch point as the sun is setting and wind energy hasn’t picked up yet in early eventings.
Why Are Summer Electricity Prices Getting Higher?
Another summer is upon us, and we know many of you are looking forward to enjoying your picnics, water balloon fights, beach trips, and more. But there is one aspect of summer that most Texans don’t look forward to: the electricity bills. You may be wondering, “Why does my bill seem even higher than last year’s summer?” Well, that’s because electricity rates are higher than they were this time last year.
About one year ago, all-in electricity rates were hovering around 10 to 13 cents per kWh. Right now, they’re around 14 to 16 cents. But what is causing this? Well there are a lot of factors that can result in rates going up. Some of these include extreme weather storms and geopolitical issues–both of which we’ve experienced in recent years. But this year, the reasoning is a little different.
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The Pinch Point: Identifying the Causes and Effects
As Texas moves forward with renewable energy and depend less on traditional energy resources like coal and natural gas, some pricing volatility may occur. Below are a few of the causes that can start the domino effect of price increases.
High Evening Demand
Electricity demand often peaks in the late afternoon and early evening when people return home from work, use household appliances, and turn on lights. This coincides with the time when solar generation drops as the sun sets.
Reliance on Solar Energy
Texas has a substantial amount of installed solar capacity. As solar generation decreases in the evening, there is a sudden gap in electricity supply that needs to be filled by other sources, like wind. But this can be challenging, especially if wind generation is also low, as the graph below shows.
Source: amperon.co
Storage Limitations
While energy storage systems like batteries can help mitigate the drop in solar power, the current storage capacity is not sufficient to cover the entire nighttime demand. This limitation requires reliance on traditional power plants.
Here are some of the effects of the causes listed above.
Grid Stability
The grid requires a consistent supply of electricity to maintain stability. Sudden drops in solar power can cause fluctuations that must be managed to avoid frequency and voltage issues.
Backup Power
Traditional power plants, such as natural gas or coal, need to ramp up quickly to replace the lost solar power. This transition needs to be smooth to ensure grid stability.
Cost
Using peaker plants (plants used during peak demand periods) to fill the gap can be more expensive. These costs can be passed on to consumers because buying wholesale electricity for the providers can be more expensive than usual. Electricity providers then raise their rates to compensate.
Understanding why electricity prices rise at certain times of the year can be a difficult thing to figure out for the average consumer. But we hope our points above make things a little bit easier!
How to Lower Your Electricity Bill
Below are a few ways you can try and lower your electricity bill while rates are higher.
Conservation
- Many electronics, such as TVs, computers, toasters, hair dryers, and phone chargers, use energy even when they are not in use. Unplug them or use a power strip to easily turn them off.
- A programmable thermostat can help you automatically adjust your heating and cooling settings to save energy when you are not at home.
- Take shorter showers, fix leaks, and turn down the temperature on your water heater to reduce energy usage.
- Use a clothesline or drying rack instead of a dryer to save energy and money.
- Ceiling fans can help circulate air and make your home feel cooler, reducing the need for air conditioning.
- Open curtains and blinds during the day to let in natural light instead of turning on lights. But, if you’re not home, it’s a smart idea to close the blinds.
- Use a slow cooker, microwave, or toaster oven instead of the oven to save energy when cooking.
- Seal gaps and cracks around windows, doors, and other areas to prevent heat loss and save energy.
Energy Efficient Appliances
- Look for Energy Star certified appliances, which use less energy and are better for the environment.
- Replace incandescent light bulbs with LED bulbs, which use up to 90% less energy and last up to 25 times longer.
- Changing your air filters at least once every 90 days can make a big difference. With cleaner filters, your air conditioning unit won’t have to run as long to cool down your home.
About Energy Ogre
Energy Ogre is an electricity management company in Texas. The Houston-based company finds Texans the right electricity plan for them now and going forward. Energy Ogre is not an electricity provider, but rather a consumer advocate. For more information, visit www.energyogre.com.