Archive for December, 2010

Billing Issues to Consider with your electricity supplier

Friday, December 10th, 2010 | Permalink

To begin in understanding your residential electricity supplier bill it is worth mentioning the billing cycle.

The electric bill cycle is usually 28 days but depending on when you sign up for electric service it may differ the first month.

The billing cycle is also related to when your meter is read. If the transmission and distribution utility company only comes out on the 8th of every month to read your meter then this could be when the billing cycle starts.

So when you sign up for electric service with a new electricity supplier around the 1st you may get an electricity bill that may have a few days in additional charges added to it.

For instance, you usually must leave about 5 days available before the meter is actually read from the time you switch to a new electricity supplier in Texas.

If you signed up on the 1st and service started in your name on the 6th and the utility reads the meter on the 8th this gives the utility 2 days of electric usage to charge you for.

Your first months electric bill would be very cheap or they may hold those two days of charges and add them to the next bill cycles bill.

In the first situation the electric bill would be a pleasant surprise as the bill would be for 2 days.

In the second situation the electric bill may look a bit too high.

Also consider that the billing cycle is not always 28 days. Sometimes the electricity billing cycle in Texas can differ between 25 – 35 days.

Reasons your billing cycle could be lengthened to as long as 35 days relate to how many days there are in that month, if there are holidays on that month, when weekend falls, and is the electric meter accessible for the meter reader to see.

Billing issues related to the electric meter may be eliminated in a large part due to smart meters being installed in most areas of Texas. For instance, in the Dallas Fort Worth area and Houston area electric smart meters are almost completely installed in every neighborhood and business district.

These smart meters send electricity data directly to the Texas electric utility.

The number of days in a billing cycle are likely to come down in time because of the new smart meter technology being implemented in the state of Texas.

Can Energy Suppliers Manipulate the price of electricity rates in energy markets?

Wednesday, December 8th, 2010 | Permalink

Commodities being traded is a typical task performed in the energy markets. For instance, a company that sells the raw fuel of natural gas, gasoline, oil, and so forth will need to buy these commodities on the futures market to lock in their prices.

The argument made sometimes is that prices on the futures market start going up in price with little relation to current energy commodity market conditions. This is when news organizations, politicians, and energy regulators come in to say something is amiss.

The accusations usually revolve around an evil energy company manipulating the price of a commodity such as natural gas in order to make more money on the actual raw commodity they own or on the electricity service they may produce through power generation facilities.

At this time the U.S. Commodity Futures Trading Commission v. Dizona, the United States Court of Appeals for the Fifth Circuit has just recently considered some commodity manipulation accusations.

The United States Commodity Futures Trading Commission has brought forth allegations that a natural gas trader had attempted to manipulate the price of natural gas by purposefully sending in false price and volume data to reporting services.

By controlling the data a natural gas trader can indeed control price when it comes to natural gas because of the limited ability to store natural gas and its high demand in some electricity markets in the US such as Texas.

When the data is received by the reporting agencies from the natural gas trader that is alleged to have manipulated the markets what is given is told to have been fabricated trading numbers.This adjusts index pricing that is used in electricity rates in states that rely on natural gas as a power plant electricity generation fuel.

Rather then the data being based on real trades that occured the trades and numbers are simply made up to cause natural gas prices to increase or decrease depending on if the trader wanted to make money going short or long.

The fifth circuit has agreed with the district court that there was not enough evidence after incriminating hearsay evidence had to be removed. So hearsay evidence showed some suspicious issues but for justice to be served this type of evidence simply cannot be used as it may convict an innocent party.

The U.S. Commodity Futures Trading Commission expert’s offered only general findings of biased reporting but could not give specifics.

The incriminating evidence was recorded on audiotape and suggested that the energy trader would set the natural gas price at a certain level but was unclear enough as to mean he was indeed manipulating anything.

Energy lawyers are suggesting however that this conspiracy of big brand energy companies using their traders to manipulate the price of natural gas could show potential for litigation if more evidence can be gathered to prove such.

We however would like to remark that too much government regulation and the limited number of large natural gas energy traders may superficially cause prices to go up. This price manipulation theory could be more related to artificial rules and measures in place by the US state and federal governments to prevent prices from spiking too high or too low while creating the opposite effect. This then paints a large target on the biggest players in the energy trading game who are only doing their jobs within the rules of government policies.

The energy law blog sees the writing on the wall for a potential win in litigation against energy traders attempting to manipulate natural gas market prices. Read below.

“In U.S. Commodity Futures Trading Commission v. Dizona, the United States Court of Appeals for the Fifth Circuit recently considered allegations by the United States Commodity Futures Trading Commission that a natural gas trader had attempted to manipulate the price of natural gas by knowingly delivering false and inaccurate price and volume data to reporting services. These data gathering services would solicit bid data at the end of each month and would analyze this data to postulate an index price for natural gas, which would in turn set the price for the following month. Supposedly, the data reported to the reporting service was not based upon actual trades but was instead fabricated by the defendant to affect these indices, either positively or negatively – By Michael A. Mahone, Jr.”

Prepay Electric Meters in Texas New Jersey and Pennsylvania, Problems in the new smart grid

Tuesday, December 7th, 2010 | Permalink

The new smart grid uses smart meter technology that sends a customers electric usage in real time directly to the utility company that manages the poles and wires and keeps track of electrical usage at each facility.

Some prepay meters offer a way to insert a prepay card in the meter at the residence to keep the meter on and running. Door to door scammers however have been creating fake prepay cards and going door to door in low income neighborhoods selling these cards for cheaper than a customer can get them elsewhere.

Low-income families often times resort to prepaying for electric service to avoid paying a large upfront deposit amount. In the past and sometimes even now prepay electric companies have been able to charge much higher rates to low income families as a trade off of not having to come up with a deposit.

The deal usually sounds sweet, “only $99 to start electric service”. This is prepaid electricity but may only keep service on a week or two. Notice the ad does not give an impression as to what the per kWh rate really is.

The smart meters being installed in Texas, Pennsylvania, and New Jersey offer low income families the opportunity to choose a competitive electricity company while yet still prepaying for their electric service.

There are different types of prepaid electricity suppliers out there and one involves inserting a prepay card into the electric meter which allows the meter to continue to run and supply electric power to the home.

Energy consumers in Texas, New Jersey, and Pennsylvania need to be on the look out for this popular scam that involves scammers selling cloned prepay electricity cards that can be inserted into prepaid electricity meters.

If a consumer falls for such a scam they may not only be paying for this fake card but have to pay double when the card that was used is found to be a cloned copy off of some poor saps stolen credit card.

Biomass Power Plants means less illegal burning in East Texas

Monday, December 6th, 2010 | Permalink

Biomass is another name for creating power with those small skinny pine trees and ground stumps loggers burn or chip away.

For several years loggers in East Texas would gather up stumps and small trees and place them in a pile on a piece of land, throw some tires on that pile, pour diesel fuel on that and light it up.

This however can cause a logger nowadays to face steep penalties that could cost a logging company $100,000 or more.

It isn’t just logging companies that have done this but excavation companies that clear out and flatten land.

Tyler, Lindale, and the surrounding East Texas excavation industry would from time to time burn their smaller sized trees and any sized trunks when the enforcement was down regarding illegal burning.

This wait and see approach on whether to burn or run logs and branches through a tree chipper is about to change.

Excavation companies and loggers will now have a big incentive to put their garbage wood on a trailer and haul it to the nearest biomass power plant in East Texas.

There are more permits in the works for the one to be built in Lindale Texas but it is getting close to construction right of of Highway 20. Texas air pollution regulators have already approved the plant while loggers, excavators, and job seekers wait in anxious expectation for a new opportunity.

Once built excavation companies and loggers will have another source for making money by logging. East Texas may find that creating power from tree clearing becomes a new industry.

Before you slam this new energy industry for destroying our forests it is important to know the facts. These trees won’t be plucked up out of the ground simply to create electricity to feed on the Texas grid.

These are trees that would have been removed anyway to build homes, businesses, roads, and in the process of logging larger trees.

Rather then waist these trees by chipping them or burning them they can create much needed renewable energy via biomass power plants.

You can read more about this topic at the Texas Tribune “Biomass Power Plants in East Texas”

Solar Panels Banned in San Antonio Texas Town Neighborhood

Monday, December 6th, 2010 | Permalink

Solar panels are great as far as I am concerned but they are expensive. This however did not come into play as to why a Texas home in San Antonio will not be using solar power.

After a pro-green energy family installed solar panels on their home they were told by the home owners association that they would need to take them down.

There apparently was a rule in the home owners associations book that bars solar panels from being on homes in this neighborhood.

The home owners association did not say why the rule is in place but I would imagine it has to do with the ugly look it ads to a homes exterior and the neighborhood as a whole.

If I were to install solar panels on my Texas home I would start out with a grow and go system. This type of system starts out with one panel and more can be added to the system as a home owner save up and can afford to add on.

Unfortunately this home installed a very expensive system on their roof and will now be required to take the whole thing down.

A new law is being suggested to Texas state legislatures that would require all home owner associations, municipalities, public utilities, etc to not be able to bar the installation of solar.

This new law makes since as solar panels alleviate the demand on the Texas electric grid and will only serve to help everyone tied into it.

You can read more about this story at “Green Energy gets the red light in some Texas neighborhoods”

Electricity Suppliers