The most controversial reason not being mentioned for higher Houston electric rates has to do with solar and wind being propped up by government. The argument is that the government is moving this new technology on to a point where it will support itself and be beneficial without outside subsidy.
Answer: The higher electricity prices in Houston show up in the transmission and distribution line charges effectively hiding the renewable infrastructure costs.
I am not talking about a conspiracy as the Obama administration’s own assistant secretary of energy explains the renewable energy dilemma in the Instagram story below. The problem is just sugar coated. Who wouldn’t be interested in a utility subsidy over here and a government grant or subsidy over there to help pay for their solar panels?
If you have the mini-mansion house the next upgrade would be solar panels on your roof or backyard. You may get the swimming pool first but you get what I’m talking about. This is not for the poor. Look around you to see solar taking off in Texas, it’s starting to happen at scale.
When you say “the government” you might as well say “your taxes“. The renewable energy sector can be compared to fats and cholesterols forming on the walls of your arteries. Our healthy, affordable, and sustainable energy sector has developed heart disease you could say. The cholesterols and fats happen to be the renewable energy market being held up by big government.
There are federal taxes and state utility fees that are not transparent to the public that increase the overall cost of electricity. You can read the Instagram story with a quote from the assistant energy secretary for the Obama administration explaining the issue. Read the story to see how solar and wind create a serious energy affordability problem for Texans and those living in large populated areas like Houston.
What are the Immediate Reasons Houston Electric Rates are so High in 2022?
Answer: The immediate reasons where people saw the average 12 month contracted rate go up to 26 cents per kWh had to do with the war between Russia and the Ukraine. Houston had to deal with these high energy prices but the rest of Texas had to also.
When war time messes with energy prices it is easier to see how renewables kink the system we had and add too much complexity.
The war made liquid natural gas a hot commodity for European countries and countries surrounding Russia that needed to keep their economy running. Texas generates 47 % of their electricity from the burning of natural gas.
Our state had to export the Liquid form of natural gas to European countries to keep those countries running during war time. Texas paid the price by higher electricity rates.
Renewable generation increased the amount of pole and wires infrastructure unnecessarily. Combine the expense of renewables with our main generation fuel being bid up in price and you end up with very expensive prices.
Solar and wind works in tandem with primarily natural gas power plants as they need them to provide consistent supply. If someone offers the idea that now is the time for more renewables it is important for them to know they only work in tandem with something like natural gas to supply consistent power throughout the day and night.
In summary, I love wind and solar. I see them as a luxury item and something that the low-income cannot afford. Low-income families cannot afford the high electricity prices either. As people start putting “free solar panels” on their roofs it only increases the risk of higher prices to come. If you look at California they offer an example of a state that largely adopted solar but have unimaginably high electric rates.
Donny has been writing about the deregulated energy markets since early 2007. His knowledge has helped consumers lower their electricity cost.