Texas Energy Price Swings
Why Are Texas Energy Prices So Volatile?
Texas energy price swings are usually larger then in other markets and last longer. For instance if you were used to paying a cheap energy rate last month and now wonder why only a month later when you went electric price shopping rates were several cents a kWh higher then you are familiar with the price volatility experienced in the state of Texas. Texas utilizes natural gas power plants to produce much of the electricity here. Because the transportation and storage of natural gas is a bit harder to control in comparison to electricity you have to deal with quite a few factors. Transportation and storage of natural gas as well as the cost of turning natural gas to electric power are a part of this price volatility in Texas. As Texas uses more coal, nuclear, hydro, wind energy as well as other power generation approaches the playing field will even out and we will not be relying upon one of the most volatile energy sectors in the market.
Should I Hold Out and Wait for Rates to Drop?
If you have come up on the end of your Texas commercial energy contract and need to price shop again for a low electric rate don’t try and hold out for a drop in prices. When natural gas and or electricity in Texas goes above a certain price threshhold it may stay there for several months before it begins to come back down. When the price does come down it many times will come down quite fast. This type of price volatility causes Texas businesses to react emotionally to what looks like an unstable market. The truth is that what goes up in the commodities market eventually must come back down. Because no one knows exactly when energy will drop it is important to have a energy risk management strategy to still be able to remain confident when procuring power in a volatile market. Certain electric power products out there allow you to purchase energy cheaper then most would feel comfortable doing. The key to purchasing power at an affordable level is to know how to hedge it correctly based upon accurate data. Texas Facility Energy Management company’s sole purpose is to educate and assist in the purchase of a discount electric rate product while protecting your company against any possible price swings that could jeopardize the savings potential of that rate.
Learn More About Texas Industrial and Commercial Energy Options
To learn more about how Facility Energy Management Company can work with your business to obtain a competitive electric rate in the face of higher electric prices we ask that you give one of our energy consultants a call. We can be reached at 817-929-7095.
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