Electricity prices range widely in Reliant HL&P’s Texas territory

Ann de Rouffignac
OGJ Online

HOUSTON, Jan. 4, 2002 – Texas electric retailers have begun dangling incentives in front of consumers to convince them to switch providers. The market fully opened for retail competition Jan. 1.

While several competitors are selling electricity to consumers at prices two-tenths of a 1-/kw cheaper than the guaranteed price offered by Reliant HL&P, a unit of Reliant Energy Inc., one company, Energy America is offering electricity for half a penny/kilowatt cheaper. Two suppliers, Green Mountain Energy Co. and New Power Co., are selling electricity for more than Reliant’s guaranteed price.

TXU Energy, a unit of TXU Corp., Dallas, is offering a $25 credit on the first month’s electricity bill to entice residential consumers to switch service in Reliant HL&P’s Houston area service territory.

“We offered the incentive to make our initial offer more attractive,” said TXU spokesperson Sandy Smith. “We have incentives available in all market areas in Texas.”

TXU’s price for electricity based on 1,000 kw-hr/month is 8.4-/kw-hr. This compares to Reliant HL&P’s guaranteed price to residential customers of 8.62-/kw-hr. These prices include the company’s monthly fee and all other costs except applicable state and local taxes.

A residential consumer can save $2.20/month by switching service to TXU based on 1,000 kw-hr of usage. “It’s a lot of work to look into competition and switch,” said Smith. “The incentive is a sort of compensation for the consumer’s time and effort.”

Entergy Solutions, an affiliate of Entergy Corp., New Orleans, La., will sell its electricity in Reliant’s territory at 8.4-/kw-hr, the same price as TXU. Both companies said switching to them carried little risk because customers can cancel without incurring fees or penalties.

New Power Co., Purchase, NY, which helped lead the charge for retail residential deregulation, is offering electricity at 8.8-/kw-hr based on 1,000 kw-hr/month, according to the state-mandated electricity facts label that appears on the company’s web site. The price is good for 1-year. Customer must give 90 days notice and pay a $50 cancellation fee to stop the service. Without the 90-day notice, the cancellation fee is $95.

New Power recently announced a change in corporate strategy, gearing its future marketing efforts toward small and medium-sized business customers.

Renewable sources
Green Mountain Energy, Austin, Tex., is selling electricity generated from renewable sources such as wind power for the environmentally conscious consumer. With electricity priced at 9.2-/kw-hr, Green Mountain Energy doesn’t require a contract, imposes no cancellation fees, and has a 100% guarantee allowing customers to return to utility’s retail affiliate, said spokeswoman Molly Hanlon.

First Choice Power, a unit of Texas New Mexico Power Co., Fort Worth, is offering a 1-year deal for 8.6-/kw-hr based on 1,000 kw-hr. There is a $35 cancellation fee that will be waived, if customers cancel before receiving the first bill.

GEXA Energy Corp., Houston, also set the price at 8.6&cent/kw-hr based on 1,000 kw-hr usage, according to the electricity facts label. There is no contract term and no early termination penalty, exit, or switching fee.

But bills have to be electronically paid or the company assesses a $1 fee for each paper bill, $2 fee for each bill paid by check, money order, or cash, and a $15 one-time fee for apartment dwellers.

By the far the most competitive offer is from a unit of UK energy giant Centrica PLC. Republic Power, the British company’s US unit, is doing business in Texas as Energy America. Energy America has a 3-year deal for 8.07-/kw-hr based on 1,000 kw-hr/month. There is an early termination fee.

But spokeswoman Holly Winston said terms of the fee have not been decided. Energy America will have its product ready for the market later this month, she said.

Contact Ann de Rouffignac at annd@ogjonline.com

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