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Old 03-15-2016, 03:07 PM
 
Location: Avery Ranch, Austin, TX
8,469 posts, read 14,455,466 times
Reputation: 3664

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Quote:
Originally Posted by JPS1 View Post
Last month my full cost for electric energy purchased from Georgetown Utility Systems - the only game in town - was a mind boggling 24.3 cents per kWh. I am a low volume user, i.e. less than 200 kWh per month, so I get hit hard with the fixed or demand charge.

In most of Texas people can shop for electric energy in the deregulated energy market. Not in Georgetown, however, because it is owned by the city! And the last thing the public servants of the city want their constituents to have is choice. Which is understandable. Because if the city owned utility system had to compete against the investor owned electric utilities, it would go out of business within a month.
Big yawn...most of the residents of the city of Austin don't have a choice, either. Some get Austin Energy, some PEC. In the four states in which I've resided, I don't recall ever having the ability to shop for electric...nat gas, yes...and that was a mess back in Georgia for a couple of years.

I agree about the fees and "taxes" being somewhat outrageous. Seems you could cut your usage to nearly nothing and still have a significant bill. Same for auto tags and other utilities. They include "fees" so they can say the "taxes" are low
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Old 03-15-2016, 03:33 PM
 
Location: Austin, TX
13,615 posts, read 30,311,035 times
Reputation: 7195
You are not paying that much per kWh, really, you are paying for the access to electricity and the convenience to use as much or as little as you like. So, you are paying $50 for electricity, give or take? So, probably about 10cents per kWh and the rest is connection/regulation fees? Anyway, you would likely pay more on a deregulated plan - they charge you a penalty, in some cases, for not using enough, although a lot appear to have changed that to a 'cash back' if you use over 1,000 kWhr.
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Old 03-17-2016, 05:21 PM
 
Location: Sun City Texas
55 posts, read 110,010 times
Reputation: 53
Quote:
Originally Posted by 10scoachrick View Post
Big yawn...most of the residents of the city of Austin don't have a choice, either. Some get Austin Energy, some PEC. In the four states in which I've resided, I don't recall ever having the ability to shop for electric...nat gas, yes...and that was a mess back in Georgia for a couple of years.

I agree about the fees and "taxes" being somewhat outrageous. Seems you could cut your usage to nearly nothing and still have a significant bill. Same for auto tags and other utilities. They include "fees" so they can say the "taxes" are low
The key issue is choice. Outside of Austin and San Antonio, as well as a number of smaller communities, including Georgetown, Texans can shop for an electric energy plan that best fits their needs. Not the needs of a one size fits all government owned utility!

Texas began to deregulate the investor owned electric utility business in the Lone Star State in the early 90s with the opening of generation to competition. The process reached its full potential in 2002 when the retail side of the business was deregulated. Today, as an example, people in Dallas can select from more than 350 plans offered by nearly 40 retailers.

As an insider I participated in the processes of transitioning one of the largest utilities in Texas from a regulated monopoly to a competitive enterprise. As a result the waste and inefficiency normally associated with government owned enterprises, or those that act like government agencies, which was the case with the regulated monopolies, was mostly eliminated. It was either get lean and mean for a competitive environment or watch the business melt away.

The publicly owned utilities in Austin, San Antonio, etc. don't want competition because they know that they would lose the game in a relatively short period of time. Thus, their city councils, which control the city owned electric utilities, don't allow competition. It is one size fits all.

The council persons will argue to the cows come home that barring competition is the best outcome for their constituents. But they would howl loud and long if only one car dealer was permitted to operate in their community, and the only color choices were white, blue, and black.
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Old 03-17-2016, 07:02 PM
 
Location: Austin, TX
13,615 posts, read 30,311,035 times
Reputation: 7195
Dude, the public utilities are out to make money and pay shareholders and CEOs. The city 'waste' can't even come close. Really, giving bonuses for using more electricity? At my usage level (well under 1,000 kWh, on average), I don't think there is one of the 'deregulated' ones that comes close to what I pay to AE. I have lived in deregulate areas. I know the shenanigans.

And that is ignoring the fact the AE and CPS essentially subsidize the low users and instead of giving profits to board member or in dividends, they invest in energy efficiency programs and subsidize solar installations. The result is that the people in AE and CPS have a continued decline in kWh per sf compared to the areas served by the private utilities. AE has no desperate need to add capacity, even as the population grows. Private utilities want to squeeze as much power out on to the market as they can so they can make more profit by increasing volume.

Last edited by Trainwreck20; 03-17-2016 at 07:11 PM..
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Old 03-17-2016, 11:05 PM
 
2,898 posts, read 3,599,784 times
Reputation: 3191
Quote:
Originally Posted by JPS1 View Post
The key issue is choice. Outside of Austin and San Antonio, as well as a number of smaller communities, including Georgetown, Texans can shop for an electric energy plan that best fits their needs. Not the needs of a one size fits all government owned utility!

Texas began to deregulate the investor owned electric utility business in the Lone Star State in the early 90s with the opening of generation to competition. The process reached its full potential in 2002 when the retail side of the business was deregulated. Today, as an example, people in Dallas can select from more than 350 plans offered by nearly 40 retailers.

As an insider I participated in the processes of transitioning one of the largest utilities in Texas from a regulated monopoly to a competitive enterprise. As a result the waste and inefficiency normally associated with government owned enterprises, or those that act like government agencies, which was the case with the regulated monopolies, was mostly eliminated. It was either get lean and mean for a competitive environment or watch the business melt away.

The publicly owned utilities in Austin, San Antonio, etc. don't want competition because they know that they would lose the game in a relatively short period of time. Thus, their city councils, which control the city owned electric utilities, don't allow competition. It is one size fits all.

The council persons will argue to the cows come home that barring competition is the best outcome for their constituents. But they would howl loud and long if only one car dealer was permitted to operate in their community, and the only color choices were white, blue, and black.
You are making a huge assumption that the consumer will have choice along with economic deregulation. Your are assuming the consumer could switch to a provider of their choice whether it is based on $$ or some other factor. What happens with economic deregulation when consumers also do not have choice? In such a case no matter how good a service or product, the vendor cannot compete at all.

Where might this happen? In HOA-burdened subdivisions. This has already happened with numerous goods and services including internet services, video services, propane gas, telephone, etc.

The cable companies had monopolies in these places for years and it took federal law to prohibit an HOA from being able to prevent people from having satellite services.

When telephone was deregulated developers immediately sought to profit by using the HOA to mandate particular providers.

A perpetual residual income scheme off of propane was envisioned by vendors that colluded with developers to use an HOA corporation to mandate homeowner to install and use gas appliances - and then require them to purchase propane from a specified vendor. Of course all of this was marketed as "benefits the community". These propane vendors could compete unfairly outside of these subdivisions as well because they could subsidize sales where competitors existed by simply charging more to the involuntary customers in HOA-burdened housing. Those HOA homeowners were forced to purchase propane from specified vendors under threat of fine and foreclosure on their homes.

If you think folks won't immediately move to scheme to decouple "choice" from economic deregulation, you are operating under a false assumption. Economic deregulation means that higher prices can be charged too. I'm not a fan of monopolies but it would be better to have an economically regulated one without choice than to have the false appearance of choice coupled with economic deregulation. You can bet that you are going to have entire subdivisions of people trapped because of these schemes.
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Old 03-18-2016, 08:29 AM
 
Location: Sun City Texas
55 posts, read 110,010 times
Reputation: 53
Quote:
Originally Posted by Trainwreck20 View Post
Dude, the public utilities are out to make money and pay shareholders and CEOs. The city 'waste' can't even come close. Really, giving bonuses for using more electricity? At my usage level (well under 1,000 kWh, on average), I don't think there is one of the 'deregulated' ones that comes close to what I pay to AE. I have lived in deregulate areas. I know the shenanigans.

And that is ignoring the fact the AE and CPS essentially subsidize the low users and instead of giving profits to board member or in dividends, they invest in energy efficiency programs and subsidize solar installations. The result is that the people in AE and CPS have a continued decline in kWh per sf compared to the areas served by the private utilities. AE has no desperate need to add capacity, even as the population grows. Private utilities want to squeeze as much power out on to the market as they can so they can make more profit by increasing volume.
As any accountant knows or should know, the cost of a commodity - electric energy is a commodity - consists of the variable costs and the fixed costs divided by the basic unit. In the case of electric energy it is kWh.

No matter how one spins the numbers, the cost of energy in Round Rock, which is next door to Georgetown and Austin, is less than the total cost of energy in either place. In Round Rock it can be as low 5.6 cents per kWh on the spot market compared to 9.09 cents in Georgetown before the demand charge. Round Rock is in the competitive energy market. Its users can shop for the best deal. In Georgetown and Austin it is one size fits all. Take it or leave it!

As is true for public power across the nation, which serves approximately 15 per cent of the population, it pays no taxes. None! It is able to fund its infrastructure with tax free municipal financing, which is a taxpayer subsidy, whilst the investor owned utilities pay all sorts of taxes and must borrow money in the open financial markets.

City owned utilities are not only less efficient than investor owned utilities, they depend on the investor owned utilities for a significant portion of their power and, in some case, infrastructure.

Georgetown Utilities wheels a significant portion of its power over Oncor's transmission lines. Of course, it pays a tariff to do so, but it probably is less than what the utilities would have had to pay to build its own transmission lines.

Georgetown Utilities is touting the fact that it will be 100 per cent renewal by 2017. Wind and Sun! Built with taxpayer subsidized low cost financing. And if the wind does not blow or the sun does not shine, where will it get the power. From the ERCOT power pool, which gets most of its power from investor owned utilities and co-generators.
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Old 03-18-2016, 08:33 AM
 
Location: Sun City Texas
55 posts, read 110,010 times
Reputation: 53
Quote:
Originally Posted by IC_deLight View Post
You are making a huge assumption that the consumer will have choice along with economic deregulation. Your are assuming the consumer could switch to a provider of their choice whether it is based on $$ or some other factor. What happens with economic deregulation when consumers also do not have choice? In such a case no matter how good a service or product, the vendor cannot compete at all.

Where might this happen? In HOA-burdened subdivisions. This has already happened with numerous goods and services including internet services, video services, propane gas, telephone, etc.

The cable companies had monopolies in these places for years and it took federal law to prohibit an HOA from being able to prevent people from having satellite services.

When telephone was deregulated developers immediately sought to profit by using the HOA to mandate particular providers.

A perpetual residual income scheme off of propane was envisioned by vendors that colluded with developers to use an HOA corporation to mandate homeowner to install and use gas appliances - and then require them to purchase propane from a specified vendor. Of course all of this was marketed as "benefits the community". These propane vendors could compete unfairly outside of these subdivisions as well because they could subsidize sales where competitors existed by simply charging more to the involuntary customers in HOA-burdened housing. Those HOA homeowners were forced to purchase propane from specified vendors under threat of fine and foreclosure on their homes.

If you think folks won't immediately move to scheme to decouple "choice" from economic deregulation, you are operating under a false assumption. Economic deregulation means that higher prices can be charged too. I'm not a fan of monopolies but it would be better to have an economically regulated one without choice than to have the false appearance of choice coupled with economic deregulation. You can bet that you are going to have entire subdivisions of people trapped because of these schemes.
Presumably you favor re-regulating the airlines, telephone companies, internet, etc. Good luck with that.

Mercifully, most Americans have come to realize that deregulation of the commercial terms of these services, as opposed to health and safety standards, while not perfect, is better than regulated monopolies.

Choice drives efficiency and effectiveness or the entity goes out of business. To be replaced by a business than can respond to customer needs.
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Old 03-18-2016, 09:11 AM
 
Location: Austin, TX
13,615 posts, read 30,311,035 times
Reputation: 7195
Quote:
City owned utilities are not only less efficient than investor owned utilities, they depend on the investor owned utilities for a significant portion of their power and, in some case, infrastructure.
So, the municipal utilities are subsidizing the public utilities, therefore enabling the low cost of public utilities.

Also, municipal utilities are generally vested in maintaining cleaner air (and keeping their metro's in 'attainment' of the ozone standards), whereas the public utilities have no concern there other than what the regulations will allow. The cheapest form of electricity for decades has been coal, so the public utilities built coal/lignite plants. Also the dirtiest (albeit much cleaner than they used to be). The resulting pollution has pushed areas into, or contributed to, nonattainment status. Other businesses are impacted by nonattainment, so where the public utilities save money, others foot the final bill in clean air and the resulting impacts.

Now, mind you, Muni's also have coal power, but they have been much more aggressive in pursuing alternative energy. AE and CPS are both investing significantly in solar compared to public utilities, and work on reducing energy requirements/usage so that additional capacity is not needed. So even where the cost of electricity is 'cheaper' per kWh (if you use enough), the overall cost for a region may be much higher. It is essentially part of a pass-through cost that the individual user does not see.
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Old 03-20-2016, 10:14 AM
 
Location: Sun City Texas
55 posts, read 110,010 times
Reputation: 53
Quote:
Originally Posted by Trainwreck20 View Post
So, the municipal utilities are subsidizing the public utilities, therefore enabling the low cost of public utilities.

Also, municipal utilities are generally vested in maintaining cleaner air (and keeping their metro's in 'attainment' of the ozone standards), whereas the public utilities have no concern there other than what the regulations will allow. The cheapest form of electricity for decades has been coal, so the public utilities built coal/lignite plants. Also the dirtiest (albeit much cleaner than they used to be). The resulting pollution has pushed areas into, or contributed to, nonattainment status. Other businesses are impacted by nonattainment, so where the public utilities save money, others foot the final bill in clean air and the resulting impacts.

Now, mind you, Muni's also have coal power, but they have been much more aggressive in pursuing alternative energy. AE and CPS are both investing significantly in solar compared to public utilities, and work on reducing energy requirements/usage so that additional capacity is not needed. So even where the cost of electricity is 'cheaper' per kWh (if you use enough), the overall cost for a region may be much higher. It is essentially part of a pass-through cost that the individual user does not see.
Anyone in the competitive energy market can buy green power. One hundred per cent if that's what they want. It costs more than mixed power, but green power does not cost as much in Dallas, for example, as it costs in Georgetown. You can look it up on PowertoChoose, which is the on-line webpage that allows Texans in the competitive electric utility market to shop for power.

Almost all of the electric energy in Texas has some green in it. Last year approximately 11 to 13 per cent of the electric power generated in Texas was from wind or solar, with wind having the lion's share of green energy. In addition, nuclear power plants generated another 9 per cent of the state's power. Thus, more than 20 per cent of the electric energy generated in Texas came from non-fossil fuel sources.

AE and CPS have not invested anything in wind and/or solar generation in Texas. They have, however, signed contracts to buy the power, if it is available, on a long term basis. This gives the investors the incentive to go ahead with their projects. However, the bulk of the wind and solar power in Texas has been contracted for by the state's investor owned utilities.
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Old 03-20-2016, 10:31 AM
 
Location: Sun City Texas
55 posts, read 110,010 times
Reputation: 53
As noted above Sun City residents cannot shop for electric energy. They have to buy their power from the city owned electric utility. As a result they probably pay more for power than would be the case if the market was open to competition.

When asked whether the city had ever solicited proposals from potential alternative service providers, i.e. Austin Energy, Oncor, etc., to provide electric energy for Sun City (Georgetown), the response was no. Imagine! In more than 100 years Georgetown Utility Systems has not so much as attempted to determine if an alternative service provider could deliver electric energy better, faster, and cheaper than the city owned electric utility. Wow! No wonder they don't want to allow competition!

In addition to a non-competitive electric energy market, Sun City residents are pretty much locked into one supermarket: HEB. It has a lock on the grocery market business in Georgetown. If a resident does not like being locked into a sole grocer, she can drive approximately 10 miles to Wolf Ranch, where there is a Target, which has a limited line of groceries. Or she can drive approximately 9 miles to Walmart, which also has a limited grocery outlet. Everything in these outlets is prepackaged. There is no butcher, etc. on site.

Last edited by JPS1; 03-20-2016 at 11:01 AM..
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