But competition didn't necessarily end up cutting prices, according to the report. One contributing factor is confusion among customers as they try to choose among scores of retail electricity providers and the overwhelming variation of plans, leading many to just stick with familiar companies rather than look for better deals, according to the Texas Coalition for Affordable Power .
Then, in 2002, Texas deregulated the electricity market and everybody cheered! Except that, sure, deregulation opened up the market to competition that may (or may not) have resulted in lower rates, but it introduced a whole host of other issues. These issues may not have been factors before but now they’re critical when you’re on the look-out for cheap Houston electricity providers.
Electric bills for customers in the Houston area can more than double in summer months, mainly because air conditioning. Not coincidentally, electric rates also rise in the summer months because of this increase in demand. The most dramatic rate increases occur in month-to-month plans, but electric rates do increase across the board for all fixed-rate contract lengths.
Business specialists say that retail electricity companies follow a model used in other mature industries, such as banking, cell phone services and cable television, where the market is saturated and the main way to grow is by poaching customers from competitors. In all these industries, companies use cut-rate promotional offers to win customers and then hope inertia sets in once promotions expire and prices increase.
Patrick Mays, an engineer for an oil and gas company in Houston, recently went shopping for a new electricity plan and found that the best deal available would cost about 55 percent more than what he’s paying, boosting his average rate to 9.5 cents per kilowatt hour from 6.1 cents under his expiring 12-month contract. The power bills for his 2,000-square foot home will climb an average of $30 a month over the year, he said, but he will take the brunt of the rate increase during the hot summer when he estimates his monthly bill will top out at $186, nearly double the $95 he paid last year.
3. Customer service: When the only utility available has lousy customer service, nobody is surprised. They don’t even pretend to care – they know they have you over a barrel. With all these new players in town, however, it’s a slap in the face to be treated like royalty until you’ve signed on the dotted line and now they won’t even return your calls or the person on the phone can’t string three English words together or if he does speak English, he’s brand new and panicking trying to pull up your account information.
Switching electricity supplier could shave pounds off your bills. But it’s not always about how much hard cash you could save. You might be fed up with poor customer service, you might want greater visibility of your usage through an app or you might want to choose your supplier based on their green credentials, or whether they supply a smart meter.
Electricity or Gas Supplier License/Order #s: CA 1359, CTA0006, CTA0032; CT 01-06, 06-07-11, 06-02-17; DE 00-162; DC GA2012-12, GA06-2, EA01-5, GA 11-5, EA 06-5-4, GA03-5; GA GM-46; IL 02-0489, 03-0320, 16-0205,17-0330, 07-0498; IA G-0010; ME 2000-989, 2002-64; MD IR-3645, IR-655, IR-311, IR-500, IR-3644, IR-228; MA GS-053, GS-030, CS-015, CS-045; MI U-14066, U-14867, U-13660, U-13245; NE NG-0043; NH DM 17-024; NJ GSL-0074, GSL-0101, ESL-0016, ESL-0066, GSL-0132, GSL-0099, GSL-0150, ESL-0171; OH, 09-153G, 00-003E, 00-013E; OR ES4 (12-162); PA A-2016-2542899, A-125095, A-110036, A-2016-2547424, A-110110; RI 2379(Z1), D-96-6(E); TX 10014; VA G-26, G-34, G-36, G-51, E-11A
If you live in the greater Houston area, there are over 60 different energy suppliers competing for your business. Many of these providers have websites that are confusing and difficult to navigate, their rates buried in misleading advertising and dense jargon. Who has the time to sort through and keep track of options across all these different sites?