Power generation projects, which have to sell their power to these bankrupt utilities, require creative financing structures to get around these problems. In a bid to reduce their risk when financing these projects, bankers employ financial tools like put call options agreement or World Bank partial risk guarantees. The problem is these tools add complexity and cost which end up being passed on to the end-user or worsen the financial state of the power utility.
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The growth in wind power and natural gas fueled power will offset the loss in coal over time but for the summer of 2018, expected record demand for electricity will converge with power plant closures to put a squeeze on wholesale electricity rates. This, in turn, will cause the retail electricity prices paid by most Texas consumers to increase. The rise in wholesale rates could be particularly dangerous for consumers who have electricity plans that are tied directly to the wholesale price of electricity.
One of the most common sticking points for electricity customers is what, exactly, the difference is between an electricity provider (also called REP, CRES, or electric supplier) and an electric utility (also called a TDSP, TDU, or EDU). They’re both vital to the success of electricity deregulation, but they play very different roles. Understanding how they fit together can make a big difference in your overall confidence as an electricity customer trying to shop for the best electricity plan.
Generation / supply price: What you pay. Unlike other states, Pennsylvania keeps cost per kWh easy to understand. Other states muddy the waters by including fees and discounts applied according to usage amounts in the quoted rate. PA companies show you you one steady rate. If you’re looking at a variable plan, this cost will reflect your first month only. If it is a special introductory rate, they’ll tell you how long it lasts.
Just be sure you know what you’re signing up for. Just Energy doesn’t have the best track record when it comes to transparency. In recent years, the Massachusetts Attorney General ordered the company to pay $4 million in restitution to customers who were charged exorbitant rates and cancellation fees that did not appear in Just Energy’s advertising. As part of the settlement, Just Energy agreed to run all its advertising past an independent monitor.
If you’re on a fixed rate tariff with your current supplier, check to see if there’s an exit fee for leaving the contract early. If there is, you’ll need to factor this cost into your price comparison as it could swallow up some of the potential savings. If you can supply your tariff name when you get a quote, we can take your tariff into account when showing you the savings you could make.