A BKV Energy expert says Houston-area shoppers may find some of the lowest electricity rates in two years, but fixed-rate plans and fine print still matter.
Justin Sullivan/Getty Images
Houston’s electric bills are not magically getting cheaper, but the window to shop for a better plan may be better than it has been in years.
Energy experts like Sam Luna of BKV Energy told Chron the electric supply side of Houston-area bills has dropped sharply, even as delivery costs tied to CenterPoint and grid maintenance continue to pressure customers.
Article continues below this ad
“When you look at the cost per kilowatt over the last two years in Texas, this last month in August is the lowest it has been in two years,” Luna said.
That matters because Houston-area power bills are generally shaped by two things: delivery charges tied to CenterPoint and the rate customers pay their selected electricity provider. But because storms continue to strain the region’s grid and more infrastructure work is needed, CenterPoint’s part has not been able to fully recover.
What about data centers?
Luna also pushed back on concerns that data centers will automatically drive up residential electricity costs in Texas, saying many new projects are expected to generate power through private-use networks or behind-the-meter setups instead of relying directly on the grid.
Article continues below this ad
“That protects the grid itself and residents and businesses,” Luna said.
The part shoppers can control, however, is their retail electricity plan. Luna’s advice for customers was to still consider switching (even if under contract) as some residents may save enough on a lower rate to offset an early termination fee within months.
“If you’re shopping right now, you’re going to get some of the lowest rates we’ve seen in two years,” Luna said. “For most people that we’re seeing, it’s two to three months and they start seeing savings.”
How long will we see low rates?
It’s unclear how long this trend will continue, but Luna pointed to our less than active hurricane season. But with El Nino looming, prices may change sooner than we think.
Article continues below this ad
“There will probably be the possibility of one or two winter storms, but nothing long held and the pricing that we’re seeing today should hold in the market until we start to see a more solidified weather pattern for the winter,” Luna noted.
Why this matters for Houston wallets
The advice comes as affordability continues to creep up in almost every corner of Houston life. Chron recently reported how Houston’s rent looks cheaper than major cities on paper, but many renters are still struggling financially because incomes are lower. City Council also recently approved an ordinance requiring landlords to provide working air conditioning in rental units; a debate that included concerns over electric bill costs to tenants and property owners.
Luna admitted the new AC rule could raise costs for some landlords but does not expect a major change in most tenants’ electricity bills. Instead, he gave a bigger warning to avoid plans that look cheap or offer free incentives.
Article continues below this ad
“Don’t be fooled by gimmicks,” he said. “There are a lot of marketing tactics. Get free this, get a free that, get a bill credit, get a free subscription to something. You’re paying for that in your electricity rate.”
Do not get fooled by the freebies
Instead, Luna recommended fixed-rate plans for most shoppers, saying variable or month-to-month plans can become risky if weather forecasts or market conditions change.
“Look at the electricity facts label, see what the real rate is and go for that,” he said.
Article continues below this ad
That does not mean every household needs the same plan that works for them and their families. In other words, you don’t have to feel obligated to abide by “free nights.”
“Find the plan that matches your lifestyle and your usage. Don’t get taken advantage of,” Luna said. “”Sixty percent of your usage in Texas is from your AC and if you can’t shift your AC load, a free night plan really doesn’t make sense for most people.”
Ways to actually save and keep cool
His practical tip is to pre-cool the home early in the morning if you have a programmable thermostat.
Article continues below this ad
“If you have a programmable thermostat, you set it to cool to 68, you know, between 2 and 4 in the morning,” Luna said. “It was less work for your AC to cool the home because it’s already cool outside.”
Fans can help, too, but only if someone is actually in the room.
Stay informed, and entertained.
By signing up, you agree to our Terms Of Use and acknowledge that your information will be used as described in our Privacy Policy.
“Fans cool people,” Luna said. “They don’t cool a room, but they cool you.”
Article continues below this ad
Still, the simplest takeaway for shoppers was less technical: check your plan, read the fine print and ask your provider for a better rate.
“Right now the rates are so low, if your electric provider isn’t willing to lower your rate to keep you, then they’re not viewing you as really a valuable customer,” Luna concluded.