PEC should seriously consider opening up its system to retail choice. Nobody likes central planning – holding us all captive in a one size fits all model. PEC still has a long way to go to get our trust back. No candidate is talking about cutting the average board members $80,000 compensation package for part-time service. Are they doing what’s right for the membership or feathering their own nest?
Choice allows diversity in product offerings. It is not all or nothing for everyone. If you want budget certainty, you can lock in a fixed price for five years under retail choice!
When markets were deregulated, cooperatives and municipal utilities were exempted from mandatory retail choice. Members should demand it.
The marginal price of electricity is dependent on natural gas prices. When natural gas prices were rising, these closed system rate adjustments lagged the market so their prices were cheaper. However, natural gas prices are now down to around $2.75/MMBtu from $13/MMBtu in 2008. PEC’s rate decreases have not nearly kept up with this huge decline. That is because they signed a long-term deal with LCRA that favors LCRA so they can’t shop wholesale supply, except for renewable energy. LCRA’s cost plus deal is higher than the market and PEC’s cost structure likely needs more scrubbing starting at the board’s ludicrous compensation.
It is true Nueces Co-op’s customers are not happy with retail choice but that’s because their distribution charges are very high. It’s not because the competitive supply of electricity is over priced. Kerrville buys from LCRA. They have no meter charge. Their delivery charges as well as the cost of power are much lower than much larger PEC. Why?
PEC has a lot of non-contiguous territory in the Junction area it purchased some years ago which has low demand and low demand growth. So, to maintain this expansive rural distribution system, wires charges will be higher per kilowatt. Should PEC decide to offer consumer’s the freedom of retail choice, it should consider this in the context of spinning off the Junction system we are subsidizing through higher transmission and distribution charges.
Bryce Bales
Manchaca
