Factors That Affect Electricity Rates in Pasadena
Like any competitive sector, Texas’ deregulated energy market gets affected by the supply and demand variables. The fundamental factors that influence the electricity prices in Pasadena are:
Power Generation: The type of fuel used, price of the fuel, global market fluctuations, and more impact the prices of electricity generation. Currently, natural gas is the primary marginal source of power generation in the country. It is abundantly available and costs very less.
Power Plant Costs: The time and price required to construct a power plant, daily operations, and maintenance can impact the wholesale market prices for electricity. Compared to nuclear, coal, and hydroelectric power plants, it is relatively inexpensive and quick to build a natural gas combined-cycle plant.
Transmission & Distribution: CenterPoint Energy is the local utility company in Pasadena responsible for the maintenance of aging infrastructure. These include overhead wires, poles, and other that transmit and distribute electricity. These charges can increase your electric bill.
Seasonal Demand: Every year, summers have the residents of Pasadena, TX, utilizing their air conditioning more to beat the heat. Likewise, winters also may increase heating costs. In peak demand periods, power plants may depend on electricity generators, which in turn, can result in higher marginal prices.
Energy Deregulation Basics
Long before the energy reforms began, the people of Texas and many other states had only one default electricity provider. Each service area had a state-appointed entity that monopolized the market.
However, since 2002, several state representatives voted for their respective energy markets to become deregulated and competitive. This means that the residents in these states have the power to choose their electricity supplier. 85% of Texas is deregulated, and Pasadena is one of the fortunate service territories.
CenterPoint Energy is the transmission and distribution utility (TDU) in Pasadena that delivers power to the retail electric providers (REPs). These REPs package this reliable electricity into various energy plans to suit customers of different sectors, usage levels, and requirements. They can set their electricity rates.
Since deregulation allows multiple suppliers to compete, they vie for customers with lower prices. You can choose from the energy plans by comparing these affordable electricity rates. Consumers may switch their electric service to someone that offers better prices. As a result, providers get incentivized to keep the electricity rates low and improve customer service.
Your local TDU is still in charge of distributing electricity through power lines. You receive the same quality of power regardless of which electricity provider you choose.
Green Energy Options in Pasadena
Green energy is a term that describes electrical power generated from renewable resources, such as wind, solar, geothermal, hydro, and biomass. These methods of electricity production do not have adverse impacts on the environment.
In contrast, most conventional power generation techniques use fossil fuels like coal, petroleum, and its derivates, or natural gas that pollute the atmosphere, land, and water. Harmful greenhouse gases like CO2 cause the ozone layer to deplete, leaving all living beings on the planet vulnerable to solar radiation.
They also release other toxic substances like NOx, which cause surface-level ozone or commonly known as smog. SO2 gas is the primary reason behind acid rains.
So, the United States and the whole world are looking towards renewables as efficient power generation alternatives. They are abundant in the world, do not deplete, and contain similar genetic makeup as nature.
Texas is leading the charts in renewable-sourced energy production. Wind farms topped the market share in April 2020, while solar energy reached the fifth spot.
Pasadena customers who wish to support future clean power development and renewable technologies have a wide variety of green energy plans. Electricity providers purchase Renewable Energy Credits (RECs) on your behalf. Look through your plan’s EFL to view the amount of renewable content it offers.
Plan Length: Month-to-Month, 6-Month & More
Your plan type is one of the significant factors that can affect your month-end energy bills. Making an informed choice is possible when you can understand the difference between various plans and contract lengths.
Fixed Rates vs. Variable Rates
Choosing a fixed-rate plan saves you from the trouble of switching to a cheap rate plan in a short period. The rate remains the same throughout your agreement period. You can lock in an electricity price and have peace of mind knowing that there will be no billing shocks.
A variable-rate plan has the prices changing every month, according to the energy market rates. One of the major benefits you have with variable rates is that you pay less when the wholesale prices decrease. You have the flexibility to choose another cheap electricity rate plan.
Contract plans have agreement periods ranging from three months to three years, six months being the standard. Some providers may also offer extended plans for up to five years.
They come with locked in-rates that offer stability, security, and consistency. Summertime is the best period to lock in low fixed-rates as the rates are usually high between mid-October and late November.
These are also called month-to-month electricity plans as the rate fluctuates every month. They can also be fixed-rate plans, but you don’t sign a contract with the service provider either way.
You can switch providers whenever you want, unlike in contract plans, where you incur a penalty for early termination.
While the above plan types are strictly postpaid, you can choose a prepaid electricity plan to lower your energy bills.
Prepaid plans get initiated once you make your payment in advance. You must have a Texas smart meter, key-input, or token-based prepayment meter to get the connection. These meters allow you to monitor your real-time energy consumption.
You can adjust your usage per the remaining balance in your account or add more funds as credits go down. This way, you have complete control of your budget and electricity bills.
Prepaid plans are also called pay as you go electricity plans since you can top up your account digitally from anywhere. Or, when you receive the balance alerts on your mobile, you can even pay through an authorized agent of the electricity provider. Since your usage is tracked every minute, the disconnection and reconnection are also fully automatic.
These plans are ideal for Pasadena residents with temporary living situations, such as students, tenants, graduates on a job hunt, etc. If you tend to forget to pay the bills on time, a prepaid plan can save you money on penalty, late fee, and reconnection fee. Almost anyone can qualify as there is no credit check and no identity verification.