October 2010 – The Energy Information Administration (EIA) recently published it’s “Short-Term Energy Outlook.” The EIA is a division of the Department of Energy. The report is published every quarter and provides history and forecasts with respect to the energy market.
Some of the important information in this report as it relates to electricity rates are the segments regarding natural gas AND electricity.
As natural gas is used to generate a large percentage of electricity in Texas, when the price of natural gas fluctuates, electricity rates are affected.
Below is an excerpt from the report: (see the full report)
U.S. Electricity Retail Prices. Although the average U.S. residential retail price of electricity fell by nearly 1 percent during the first half of 2010 compared with the same period last year, prices are expected to increase by 1.5 percent year-over-year during the second half of 2010. Higher generation fuel costs this year are expected to be passed through to retail consumers during 2011, pushing up residential prices by 1.4 percent next year.
The EIA report is a “nation-wide” report, and is NOT specific to the Texas market. Of note in the above paragraph is the prediction of only a 1.4 percent increase in electricity prices next year. If that was to hold true, that would be a small increase indeed. For instance, 1.4 percent on a 10 cent electricity rate is just .14 cents; a 10 cent rate become 10.14 cents. Here at Round Rock Electricity, we watch these reports continuously. We try to see the trends as they develop. We will share the information here, or will be glad to answer your questions should you call. 512-827-8005