Deregulation of Electricity
Posted by: info | April 24, 2007
More and more states are allowing customers to choose their own electric provider. There are still a lot of kinks that need to be worked out before we can determine it a success or not. Texas is one of these states that allows both residents and businesses to choose their own provider of electricity.
Since the start of deregulation here in Texas, my electric bill has sky rocketed. I am fairly confident that these higher rates are in part due to deregulation. However, the price of gas and crude oil probably has played a bigger role. Most Americans have probably seen similar rate hikes without deregulation. MY bill in 2003 was never over $200 a month. With that being said my bill in 2006 was never below $200 a month. I had multiple bills over $400 and one costing me nearly $600. However, this country has had success in the past with deregulation of other utility bills such as local and long distance telephone service.
The deregulation of long distance service was probably first. Back in the 80’s many of us was paying 0.30 a minute for a long distance phone call. Now you can find rates as low as 0.02 cents a minute. And there are not many consumers who pay more than 0.05. So you can see how far we have come since the deregulation of long distance service.
Local phone service was next. This has had very similar results as long distance calls. You can get both unlimited and long distance phone service for about $30 with VoIP. VoIP has also added to the competition and helped us save money. However, most of us have not seen a tremendous drop in our standard telephone service bill. This is a good thing though. As most products and items we buy have had big increases since 1996, telephone service has not. Each day more and more Americans are getting the opportunity to choose their local phone company, and in general this deregulation has been great.
So why are we having trouble with the electric deregulation? This is a really hard question to answer. For one many local or cities have municipalities that control the electricity in the area. These cities or regions would be hit very hard if they had the competition. This really shouldn’t be a customer problem. If they have a good business plan and model they should be able to succeed as any good business in America does. They have all the equipment, lines and power plants as a head start against the competition. This should be a huge advantage for them. As competitors would have to buy or pay for access to this equipment to serve customers. Basically this would mean the competition would serve as a middleman of sorts. Another problem with the slowed progress of deregulation could be the required license to serve customers. The state monitors and requires companies to be licensed before serving us. This we should all be very thankful for, even though it slows down the progress.
If past performances tell us anything, deregulation of electricity will work and save us money in the long run. This may take longer than any of us want, but it should be worth the wait. I don’t know how many of us can deal with another round of high electric bills. Until we get this all sorted out, many unfortunate Americans will have to make sacrifices they can’t afford. In Texas one of the best sites to get more information about switching carriers is http://www.powertochoose.org
Tags: deregulation of electricity, electric bill, local phone service, long distance service, provider, companies, company, carriers, municipalities, competitors, utility bills, rates, power palnts
Posted in: Telephone, General |
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