Cities have no business in the electricity business

Cities have no business in the electricity business and here is why.

We’ve told you so, but don’t want to say it. Now word is out – it was printed in the Ft Worth Star-Telegram that investor-owned utilities are providing some lower rates than municipally-owned and co-op utilities.

That’s even after we eliminate the tremendous fraud which has occurred at the largest co-op in the country – Texas’ own Pedernales Electricity Co-Op right near Austin. And after the overhead which is often shared by other city budget items.

AFP’s Peggy Venable was one of the early advocates of electricity de-regulation, even when some retail utilities weren’t any too excited about it. But now, it is reported that:

Retail electricity providers often offer lower rates, survey finds

Retail electric providers in Texas’ deregulated market are offering residential rates that in many instances are lower than those of some municipal power companies, electric cooperatives and investor-owned utilities that are still under rate regulation, a Star-Telegram survey shows.

A decade after the Texas Legislature passed a law authorizing deregulation, retail electric providers compete intensely to win new customers. They have sharply lowered rates in response to a plunge in prices for natural gas, which is burned to generate much of the electricity produced in Texas.

http://www.star-telegram.com/business/story/1637355.html

Hats off to the Star-Telegram and to the free market – markets work, even when government doesn’t.

Texas’ principal Internet shopping mall for deregulated rates, the www.powertochoose.org Web site operated by the Texas Public Utility Commission, lists many plans with much cheaper rates than were available a year ago.
Wa-hoo! Go shopping!!!

But those of you who are unlucky enough to be captive to the Austin Municipal Utility have been overpaying your electricity and water bills. Austin residents enjoy a modest electric rate of 9.94 cents levied by city-owned Austin Energy and take pride in the fact that it has been a leading advocate for clean, renewable wind and solar energy. In addition, the utility transferred $95 million into the city’s general fund this year. That’s a $95 million overpayment this year – it’s gravy for the city and soaking the ratepayers.

If only those customers in municipal utilities and co-ops could just go shopping!