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Energy expert says Gov. Abbott's claim of low energy prices in Texas is false


(Photo Credit: CBS Austin){ }{p}{/p}
(Photo Credit: CBS Austin)

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NOTE: This story has been updated with a response from the PUC

Electricity prices are on the rise, and energy experts are clearing up a statement Governor Greg Abbott made at the Texas governor debate on Friday. The governor claimed the state has one of the lowest electricity prices in the country, but experts say that's not true.

A majority of Texans are feeling the pain from their energy bills. During the one and only televised debate, Governor Abbott made a statement that some energy experts don’t fully agree with.

“After Uri, after the reforms that we passed, Texas has one of the lowest electricity prices in the country far below the national average," Governor Abbott said.

Doug Lewin who is the President of Stoic Energy said according to the U.S Energy Information Administration's 2019 average monthly cost of electricity bills, this statement is false.

“Our electricity costs are among the highest in the nation. A lot of times people get confused because I think the governor was in this situation between rates and bills," Lewin said.

Lewin said Texas is below the national average for rates, but those are rising faster than the rest of the country. What Texans pay on their overall bill is above the national average, Lewin said.

“Our bills are a function of two things, rates times how much we use. As a state, we have systematically underinvested in energy efficiency relative to other states," he said.

The Public Utility Commission of Texas (PUCT) reached out to CBS Austin on Wednesday to clarify that what Gov. Abbott said during the debate was, in fact, accurate. A spokesperson said that based on EIA data, Texas does maintain one of the lowest average electricity prices in the country.

According to the EIA data for July 2022, 38 states have higher average prices than Texas, at 11.21 cents/kWh.

"Texas is also well below the national average, by a full 2 cents/kWh (national average, 13.28 cents/kWh, all sectors)," the spokesperson said.

During the debate, Democratic challenger Beto O'Rourke didn't hold back and said electricity prices are the fastest growing costs in the state.

“When the blackouts started, he ordered the price of electricity pegged at its highest allowable rate. Gas started trading at 200 times what it had sold for the day before. Now, we are all paying 45 bucks more on average in our monthly utility bills," O'Rourke said.

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In response to O'Rourke's statement during the debate, the PUCT spokesperson said the cost of securitization to pay costs associated with the 2021 winter storm is estimated to be less than $1 per month for ratepayers whose providers are participating in the program.

Austinites could face paying $20 more for electricity if the city council approves a Power Supply Adjustment (PSA). A hearing on the issue was postponed last week. Austin Energy said cash balances are decreasing because that cash is paying the bills with the intent of recovering it in next year's PSA.

The price of natural gas has also doubled since Russia invaded Ukraine. The PUCT said natural gas prices and high electricity use during this summer’s record heat are two of the biggest drivers of prices.

“This is not unique to Austin, or ERCOT, or texas. This is happening nationally and even globally," said Mark Dombroski, Chief Financial Officer with Austin Energy.

The governor also said the power grid remains "more resilient and more reliable than ever before." Lewin said the state is still in a reliability crisis and it's also in an affordability crisis.

The PUCT said last week that they passed additional weatherization rules for electricity generators to make sure their equipment meets winter and summer weatherization standards.

"ERCOT has more authority than it’s ever had to manage when generators plan their maintenance, to ensure we have the generation capacity necessary to meet demand. Reliability reforms also reduced the price cap on electricity from $9,000 to $5,000 and trigger pricing incentives earlier when conditions are forecast to be tight, so generators will bring power to the grid," the PUCT spokesperson said.

During the debate, Gov. Abbott reminded Texans that just this summer ERCOT broke all-time demand records 11 times and never went into emergency conditions.

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