Best Time to Lock In Electricity Rates (Houston, Converse: apartment, power lines)

[pleasesaythe4th]

i need to check my rates asap

[rtrip]

Originally Posted by ChiefB

Hello all,

Wanted to address XodoX's statement: "I do not believe in lock in rates."

In a nutshell, the best way to pay the least for electricity over time is to LOCK IN a rate. But the timing of locking in is important. You want to 'come in and come out of' a contract in the WINTER MONTHS. Right now you DON'T want to lock in for a YEARLY deal. Take 6 month deals right now so you can exit your term in the winter.

Regarding not locking in: RISKY. When the rates go up, (like they did last year: they went up 80% from late January to July), the customer NOT locked in will pay the increases!

Think about it, if I am locked in at 10 cents and my neighbor is on a flex plan and wholesale cost of electricity approaches 10 cents, the electricity company has to have a profit from me to stay in business. I am locked in: MY NEIGHBOR is going to pay! That's just the way it is...

LOCK IN during the winter months, or 'shift' your term expiration date to the winter months..

Also, THIS YEAR is not typical.. (rates so low right now: industrial demand for natural gas is LOW, therefore costs for NG are low, therefore wholesale cost of electricity is down).. Look for next year to be more "typical."

Chief

I've kept powertochoose.org as one of my home pages and checked it every week for 77008 for over a year. Rates now are almost 2 cents lower than they were Oct-Dec. It was the same last year as well. I think that's why Dynowatt offered a cheaper rate for 6 months than 12 months fixed.

Regardless if you haven't you want to lock in a low rate now. Variable rates will be 20 cents plus/kwh when everyone has there air conditioners on in the middle of summer. Even if you switch to a 16 cent 3 month fixed then you will still have to wait a month to switch, a mistake now will cost the average consumer hundreds of dollars.

I locked in a few weeks ago at 10.7 cents, the lowest rate I had seen in 11 months.

[XodoX]

I don't know. I'm pretty sure there are some some people who have done some research on this, but I couldn't find an article that addresses that issue ( if it's wort or not).

I just know that the electricity companies here are pretty greedy. They also heavily advertise their lock in rates. I just don't think they would if they ended up losing money.

Also, the rates right now are even lower than they were october 2008. I paid 11.5 last year in october and 10.3 right now in may.

[pleasesaythe4th]

has anyone used champion energy? how is their service?

rates are at 10.2 cents plus $4.95 a month. im paying 15 cents with reliant

[tstone]

Champion is fine. No gimmicks or hidden surprises.

Never called their service line but I wouldn't expect much. All utility help lines = phone jockeys w/cue cards.

[XodoX]

I hate the 4.95 fee they slap you with if you save energy and stay below 500 KWH. I stay usually below 500 KWH and I am being punished for saving energy.

[ChiefB]

I have done the research.

I'll state simple bullet points covering most of this:

- Typically rates would be starting to go up about now (early summer). They aren't because of the low demand in the industrial sector for natural gas. i.e. THIS IS NOT A TYPICAL YEAR for electricity at this time of the year.

- WE WON'T see rates skyrocket this summer like we did last summer, so no BIG worries about seeing 20 cent rates like the month-to-month folks did last year.. (Unless you are with an unscrupulous, poorly managed provider/ ...about 9 providers went out of business last year because of poor management)

- If and when rates go up, the MONTH-TO-MONTH customer is going to 'foot the bill.' It's just plain math.. Someone has to pay.. (forecasts are that next year will get back to 'close to normal')

- The six month rate is better because the company only has to 'hedge' for 6 months. You'll pay just a little more for a 1 year deal because it's just a bit more of a risk for the company, so they have to 'hedge' a bit more.

- MONTH TO MONTH customers always pay more. (except those customers on THAT flex plan that follows the natural gas wholesale price. Those customers see low rates when Nat.Gas prices are low, but they can get hammered at a moments notice. Having said that, if there was ever a good time for that plan, it would be now.. Wholesale Nat Gas prices are real low.. Though I still prefer the peace of mind of low term rates, and not all companies offer THAT type of flex plan)..

- I wouldn't say you are being 'punished' for saving energy. You can find a plan that doesn't have a customer charge if you look hard enough, though the rate may make up the difference.
Here is the deal: The company HAS to make a profit. If you are using less than 500 kWh's, than your provider is not making much money from you at all. But they still have to send you a bill, which costs a little, they still have to process your account, etc. .. for those using such a small amount of electricity, the "customer charge" makes certain there is at least a little profit..

oh.. and one more thing:
"All utility help lines = phone jockeys w/cue cards."

NOT TRUE: I am in this business, I have hundreds of customers that get personal attention and get answers WAY BETTER than CUE CARDS I do my research and tell the truth.. Of course I don't have a crystal ball, but I make sure my customers know that too!

[XodoX]

Yes, "can get hammered". And that's the point. People need to KNOW what is out there. I switched companies 2 times last summer. So what? I never paid more than 15 cents. The rates just vary a lot, and you need to be ready to switch companies.

About the less 500 KWH charge...I don't know how much of the XX cents I pay the companies keep, but I am sure they won't go broke

Startex has a chart on its website that tells you what the current charge is. That way you always know when to switch.

[ChiefB]

I have been with the same company for 2.5 years: I have never paid more than 12.49 cents.. and that was the highest.. Most of that time was in the 11 cent range.. All the months I was in contract..

You can slice and dice it every way you want.. I have no reason to state anything other than the truth of what goes on in the market with respect to term rates and month to month plans..

Even though I work the business, don't worry folks, I will NOT publish my info here.. I have my business practice and it doesn't include advertising in forums..

Most people will not WATCH the wholesale market rates close enough to NOT get "bit" by a sudden increase in the rates. You yourself just said you paid as high as 15 cents, and you switched TWICE in one summer.. .. I use well over 2000 kWh's in a month, that 'jump' in the rates would be a good chunk of money out of my pocket..

In 'switching' company to company you won't always come out in good shape.. Find a good company that provides low competitive rates and stick with them, unless they go up.. You seem to indicate that all you need to do is watch the "Startex chart" so you know when to switch? You switched 2 times in one summer??

When you get your bill, and you notice a high rate, you have already paid a full month at a higher rate. When you decide to switch (after you get that bill) you will have to WAIT another month on that high rate before you'll be switched. (All switches take place at the NEXT regularly scheduled meter reading)..

You can't get around that "law." That's the way the switching process works.. To switch twice you would have had to notice a high rate, decide to switch, wait ANOTHER month on the high rate.. Then notice a high rate with your new provider after a month with them, then request to switch, then pay another full month of high rate, THEN be switched...

it's a FACT in the industry my friend: the month to month customer pays more...

Here is another TIDBIT that indicates this truth: The PUC recently created a new RULE that says the provider is REQUIRED to alert the customer that their TERM is about to expire.. Does anyone have a guess as to WHY that RULE was adopted?? Because the month to month rates are HIGHER and the customers got MAD that they weren't notified before their rate was raised!

Look, I would love if all the customers were month to month customers. That way I could convince many more customers to go with my service. LOL.. as it is, those in a contract I have a hard time getting.. I am telling you and all, if you wan't the best deals, year after year, find a good TERM rate and go with it... And EXIT and ENTER your ANNUAL terms in the winter months... There isn't much more to it.. Over the long haul that will serve you the best.. and you can rest and not worry about it after that..

Do the research... you'll find what I am saying is right..

If something changes, I'll come back and POST IT..

[XodoX]

You can keep telling me that month-to-moth customers pay higher rates...i still don't trust it. It might be true in the short term.. but I doubt it is in the long run. You said yourself that they need to make profit. Why would they heavily advertise lock-in rates if they lost money ? It just dosen't make sense at all. You haven't given me a sufficient explaination.


Yeah, I did switch twice. So? Why would I not switch if I get a better deal.

Btw, I rarely use more than 500 KWH...don't remember the last time I did. You should start saving some energy too