In this article:
- What happened in 2019?
- What’s going to happen in 2020?
- Will my bill increase this summer?
- Future electricity trends
- Am I vulnerable to summer’s high prices?
To say the Texas electricity space resembled a roller coaster ride in 2019 would be an understatement. What does that mean for 2020?
In 2019, wholesale customers were subjected to volatile price spikes, the demand in Texas reached a historic high, and additional renewable energy was developed. Peak demands in June and July were actually lower in 2019 compared to years prior.
And then temperatures rose, and electricity prices skyrocketed.The day’s heat prompted record-breaking energy consumption, setting an all-time record for electricity demand in Texas.
Despite record consumption, no brownouts or blackouts occurred.
Wholesale Electricity Price Volatility in 2019
As mentioned, the historic heat upended the wholesale electricity market, causing some wholesale customers to pay $9 kWh. Are you wondering what the heck is a kWh? If so, it’s the measure of electricity homeowners use each month, which determines how much they pay.
Considering electricity consumers typically pay between 6-24¢ per kWh, a $9 kWh spike left many wholesale customers with unprecedentedly high bills.
Speaking of demand, it will continue to grow as population increases, especially here in Texas. So to distribute the amount of electricity needed, more electricity must be generated.
Consequently, when demand increases, prices typically increase too. Regardless of price, the state grid manager predicts Texas will have enough power to meet demand moving forward.
It’s important to understand the past is not always the best prologue. So what’s the forecast for 2020?
What to Expect in 2020 and the Foreseeable Future?
The Electric Reliability Council of Texas (ERCOT) expects the reserve margin to increase to ensure enough power is available during peak summer heat. This reserve margin can prove beneficial in preventing blackouts and brownouts when the grid nears its capacity.
Looking further into the future, we reviewed a 2019 report from the U.S. Energy Information Association (EIA). It provides valuable insight into the future of electricity generation and consumption.
Beginning in 2020, EIA analysts used historical data to project 30-year electricity generation and consumption trends. Here are three relevant and interesting charts we pulled from the report.
Worldwide Energy Consumption to Increase by 50%
1.) According to the report, worldwide energy consumption will increase by 50% by 2050. In the same report, the EIA projects renewable energy will become the leading source of primary energy consumption by 2050.
Consequently, energy management and efficiency will become more important in the future. After all, it’s easier to lessen and modify the way we use electricity rather than generate more and more of it. Resultantly, energy management and enhancing efficiency will do the following:
-bring down electricity rates
-lessen the strain on the grid, decreasing the risk of blackouts and brownouts
-reduce the environmental toll that fossil fuel electricity generation creates
More Solar and Wind Energy Will Be Generated
2.) EIA expects a surge of solar and wind energy generation in 2020 and subsequent years. By 2050, it projects both energy forms to increase by nearly 30% collectively. With the new renewable energy generation, green plans will become cheaper and more accessible as supply increases.
Additionally, the implementation of renewable energy will add much-needed power into the grid. Solar energy is generated and consumed during the morning, throughout the day and into the afternoon. Inversely, wind generates electricity in the evenings and early mornings before the sun rises.
Fortunately, renewable generation perfectly coincides with peak electricity demand during the day, and it also helps out at night. Lastly, as new renewable power is integrated into the grid, the grid’s capacity increases, reducing the cost of electricity.
Coal Dependence Will Decrease as Renewable Energy Capacity Sustains
3.) The Organization for Economic Co-operation and Development (OECD) is an international organization comprised of participating countries. It strives to establish international norms and implement evidence-based solutions to a range of social, economic and environmental challenges. Moreover, they have a vested interest in promoting renewable energy generation and advancement for environmental purposes.
In both OECD and non-OECD countries, increases in electricity demand are primarily met with renewable generation — solar and wind. Inversely, coal dependence will shrink over the next 30 years as renewable energy generation increases.
So Does That Mean My Bill Will Increase During Summer 2020?
Only time will tell. Just as with any product or service, price is determined by supply and demand. But if you’re an existing Energy Ogre customer, you’ve taken the necessary first step to protect your home and wallet.
If your contract ends in July or August, chances are the market price for your next contract will be substantially higher than it would be outside of summer. This difference exists because the amount of energy consumed during the warm summer months far exceeds the cool winter months, driving new contract rates higher.
Good news is, as an Energy Ogre member, you may consume more power in the summer, but your rate will be low compared to other market rates. Look at it this way — the more electricity you use in the summer, the more money you save. Inversely, the less power you use, the less you spend.
I’m not an Energy Ogre Member, So Am I Vulnerable to Summer’s High Prices?
OK…don’t panic, but yes. This is especially true if you are enrolled with a wholesale provider like Griddy or Evolve Energy. So if you’re a wholesale customer, do yourself a favor, and become an ogre today. Not only will you save some money, but you’ll enjoy the peace of mind of not having to constantly monitor your usage each day. Being an Energy Ogre member protects you, preventing vulnerability or exposure to summertime price spikes.
Our members have access to below-market rates that ensure they don’t overpay for electricity each month, or ever again for that matter. Our membership includes low prices, excellent customer service, and allows you to save time and hassle that would be normally spent on shopping for your next contract.
Thankfully for you, it’s not too late to enroll and secure a below-market rate that will save you money. Our satisfaction guarantee demonstrates our unwavering commitment to our members.
If you are not satisfied with our service, we will do everything in our power to change that. If we are unable to make things right, we’ll gladly refund your membership fee.