Whenever they have a spike in demand, the de-regulated prices go up by several hundred percent. Example
Wholesale or Retail? I couldn’t read the article.
Most of us don’t pay the market price hour to hour. Our electricity provider absorbs the risk of price spikes and raises our rates if the math stops working for them.
Griddy was a provider that sells at the market rate, which is usually below the general price you would pay, but you take the risk of price spikes during peak demand.
Griddy
Thank you! So much misinformation floating around, its ridiculous.
I’ve done lots of tech projects within the retail energy industry in Texas - this is the right answer.
To expand a little bit:
Retail energy providers (REPs), like NRG, ClearSky, Just Energy, etc. make their money by forecasting the amount of energy that will be needed as far in advance as possible and purchasing that amount from power generators like CenterPoint and marking it up a few cents. The farther out, the cheaper they can get it. I’ve helped build forecasting engines for a few that ingest historical usage data from meters (all meters in Texas are smart meters), weather data, and others to use machine learning to forecast how much individuals will need and aggregate it together to help the energy traders make better informed trade decisions farther out.
If they mess up or an unforeseen event happens and they don’t have enough energy bought for that time segment (forgot the term for a window of time they use), they have to go to the spot market which is where the prices fluctuate and can be many many multitudes higher than the rate the customers are contracted to pay.
In a storm scenario or a freeze, it can be thousands of times more expensive because demand is so high and supply is so limited. This is when REPs go bankrupt if they don’t have the cash on hand.
There are also insurance plans that the REPs pay for that cover very specific conditions for different types of events or outages that can kick in to cover the huge costs they would otherwise incur on their own buying electricity at that spot rate. I’ve known a few that were only able to stay operating because someone a few years prior had bought an insurance policy that covered said weather event.
Griddy died because of the ice storm in Texas a few years ago and the huge costs people incurred. I actually met with their CIO the year prior as part of a technology assessment of their stack. Nice guy.
Edit: also you can largely thank Enron and Rick Perry for deregulating Texas’ energy - which directly led to the terrible “performance” of the Texas grid during the winter storm Uri in 2021. Same for Enron in the constant blackouts in California in the early 2000’s.
They don’t
I thank my lucky stars to be in San Antonio where we have municipal power.
People complain about CPS (city public service) but we get a say in how the company is run and our bills are quite reasonable compared to the state average.
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Get a hotel room like any adult man does when he is hot and bothered…
🤣
We have contracts like everyone else. No one pays the day by day rate.
Then what’s the point in having a day by day rate?
Because that’s what the electric company is paying, and if it stays high our contracts go up next year
It’s the same reason why the fed controls interest rates. Entities higher up the chain deal with those volatile costs so we don’t have to.
That’s the neat thing! They don’t.
What’s so neat about it?
sarcasm
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Hopefully getting their own solar panels
I hear you, but a solar set up with batteries for a house in TX is often well over $100K. It’s not easy for most of us to pull that off, even with financing. And it’s not an option at all for renters.
Thats not gonna be the minimum, its a sliding scale of how much solar you can afford.
When you include enough battery storage to keep your HVAC working without interruption, the price becomes extremely high. I was not able to find anything less than about $100k installed here that could cool a 1500-2000 sqft house for a half day.
Crazy thing about AC, its power draw lines up perfectly with solar production, you dont need much storage to run it.
That is simply not accurate in south Texas. It’s 90 degrees at midnight with 80% humidity. You need a great deal of storage.
Also, the system needs to over-produce and store that excess energy during the day so you can continue to run all night. If there is heavy cloud cover, you will also be relying on that storage during the day as well.
Im seeing lows in the 70s. If theres heavy cloud cover you wont need as much AC. Texas summers are ideal solar scenario
Where?! Austin?! Haha. Just stop. Our lows are in the high 80’s on a good day in the summer! Usually, that low happens at 4 am and is only that temp for an hour or two. At midnight, the temp is usually about 90. Also, humidity is extremely high, making our temps much more deadly. So, just stop. You definitely, definitely do not know what you are talking about.
Also, you can’t just turn off your AC when there’s cloud cover and easily get your house cooled back down when the sun comes back out, as you are implying. It takes a great deal of energy and an over-powered HVAC system (which no one has) to cool a house quickly when the sun is out.
I’m not sure what you are doing right now. Is your goal to try to convince me, a resident of this place who has tried for years to afford a solar system, to embrace a solar solution? I already want one. If you know of a vendor in south Texas that can install what’s needed to keep me and my family alive when the power goes out for the low prices you claim, please let me know who they are and I will call them!
Until then, I will just have to make do with my Generac natural gas generator that can run everything when the power goes out. That solution only costs $15k installed. There’s a reason people get whole-home generators instead of off-grid solar here. That reason is very obviously price. One day I hope to afford a solar solution (panels/batteries/installation) that can keep everything running when we lose power for several days at a time, but as of today, that is at least a $100k investment for a 1500-2000 sqft home.
$100k
that’s ten times what it costs to install domestic solar, battery storage across all of Europe including major cities. Why is it so expensive? Panels are ~$200 each online and an inverter is $5k for a really good one.
A quick google search shows prices more in line with my expectations (sources: https://www.forbes.com/home-improvement/solar/solar-panel-costs-texas/ and https://www.energysage.com/local-data/solar-panel-cost/tx/)
In Texas, you must also have enough battery power to run your HVAC for at least 12 hours, which is extremely expensive here (~$80k est. for my moderately-sized home), given how hot it is. Without a substantial battery system, you will lose power when everyone else loses power.
My $100k approximation is what I was quoted by multiple solar and battery installers here and is also in line with what my local friends, family and colleagues have paid for their systems.
As an anecdote of what happens if you don’t have enough battery storage: One of my close friends who has a whole-home system (2300 sqft home) actually still had to keep his HVAC turned off on day 2 of the recent derecho outage a few months ago because his $125k battery system could not store enough power due to cloud cover. They took out a second mortgage for that solar/battery system in 2023. He still loves the system and it mostly works fine, but it’s not perfect and it was still $100k more expensive than a 24kw Generac natural gas generator.
So, if you can find a vendor that can install solar and battery storage for a system that can keep our HVAC going in one of our multi-day outages here, please send me their information! I will definitely call them and get an estimate!
Donebrach deleted their comment :(
I’d be shocked that anyone puts up with this, but then I remember how the healthcare system “works.”
The article and comments here make me very happy to live in Quebec where the electricity is 0,067CAD per kWh for the first 40, then after it is 0,103CAD per kWh, and most of the time, that electricity is 100% renewable. In Québec we have many problems but the electricity is one big point to be proud of as a nation
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Thanks for getting to our level on your own 😘
$0.058 / kWh here in rural Oregon, it’s pretty awesome.
Now do the exchange rate.
How much is your income taxed? ~60%, like the rest of Canada?
If you want to talk about taxes, include cost of your healthcare. Because that’s included in our taxes.
Fun fact, America pays as much per capita for healthcare through taxes as Canadians, but that only gets you Medicare and Medicaid. Americans sure get angry about a lot of things, but I never see them get angry about that.
Bullshit.
According to ChatGPT:
15% on the first $49,275 of taxable income.
20% on the next $49,275 of taxable income (over $49,275 up to $98,550).
24% on the next $19,170 of taxable income (over $98,550 up to $117,720).
25.75% on the taxable income over $117,720.
Holy propaganda-muncher 😂
The last bracket which starts at 235k is about 58% (but there are many ways to put money aside to lower your income bracket). But don’t lose our hair worrying if we will have to file for bankruptcy to get basic healthcare. In Montreal we have a top 10 world university that costs less than 1000$ per semester for citizens. We also don’t have to worry about people carrying guns around. But go on I guess
A big part of that is it’s all state owned. Having private companies in charge of something as vital and important as energy infrastructure is just pure folly imo.
I like how my state does it. The grid is managed by a public utility, but we can shop around for providers. The utility handles the billing, and switching providers is super easy. I’m paying 9.5¢/kWh for 100% renewable energy, which is about 10% cheaper than the base rate I’d pay if I just used the utility.
Yeah 100%. the current government here has a tendency to do bad stuff and a big fear here is they will slowly make it more private owned. But I think that every essential service should be state owned. electricity, groceries, clothing, internet etc. We have too few companies here that share too much of the market
But I think that every essential service should be state owned. electricity, groceries, clothing, internet etc.
I’m right there with you. To think our food security hinges on a bunch of fat cats and the stock market makes me nauseous. If I start talking about the telecom industry, I might just throw my phone. Change is long overdue.
Telecom industry is so corrupt here it’s unbelievable they get away with it
Those are the wholesale prices to the utility company itself from the grid operators, not the prices to end users from the utility company. End users pay a flat amount per kWh that does not change by demand.
Most of us do. A few people do sign up for variable rate plans, and they did get astronomical bills during the snowpocalypse. IIRC they didn’t get any aid or anything, it was a small enough number of people that they just got hung out to dry.
That’s some next level owning the libs.
I’m certainly feeling owned right now. Ouch!
