Wednesday, March 11, 2009

Texas Electricity Proposed Changes

State lawmakers are looking over a proposal by the Cities Aggregation Power Project (CAAP) that would give cities the power to choose your electric provider. This is possibly one of the worst ideas I think I've come across since deregulation began in 2002. Essentially - this would provide CAAP and cities with the power to tell consumers who their "electric choice" would be. So, how is that "electric choice" anyway. They basically think people (Texas consumers) don't know what they need so they want the government to tell them what they need and who should be their power provider. Some people I speak with simply don't want to change - they like their power provider that they've had since before deregulation and simply are not switching. Well, if CAAP gets their way - consumers like this would not have that choice to stay with their current provider. They would be switched away - then they would have to contact their previous provider and switch back or they would have to opt out of the power pool so to speak. How many people do you think would miss this tidbit of opt out information if they recieved it in the mail? This proposal simply makes absolutely ZERO sense to me. More power, more control and more government is certainly not what competition and freedom of choice is all about. You currently have the power to choose even if you choose to stay with your current provider - that should be your choice. That's why large markets like electricity, transportation, telecom and others have been deregulated - so that consumers could have a choice, competition could breed lower prices - and markets could thrive through innovation.

Listen, electric deregulation has certainly had it's ups and downs since it began in 2002, but let it run it's course and work out some of the market flaws. We are currently seeing some electric prices below what they were in December 2001 before deregulation started. How many items or services do you purchase today that are at a lower cost than they were 7 years ago? I would have to say not many. Plus, the run up in electric prices this past few years and especially this past summer were not only because of deregulation - without deregulation we would have seen similar prices increases. Did we not see $4.00+ gasoline prices? Was that caused by the deregulation of the Texas electricity market? No. More competition and innovation will help this market - not more control and regulation.

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