Texas’ Summer of Energy Anxiety Continues

July 6, 2022

Texas Tribune:

Texans are seeing skyrocketing home electric bills this spring and summer, with many customers paying at least 50% more than they did for electric bills at this time last year.

And nobody seems to know when costs will go down.

“I am worried people are going to be shocked,” said John Ballenger, vice president at Texas retail electric provider Champion Energy. “Realizing this is 50 or 60 or 70% higher than what they had paid before, I’m just not sure it’s real to people yet. If it’s not, it will be very, very soon when the bills hit this summer.”

The elevated utility bills have primarily been driven by the price of natural gas, which has shot up more than 200% since late February when Russia, a top gas-producing country, invaded Ukraine and upended the world’s energy market.

Since then, Texas, the leading natural gas-producing state in the U.S., has not been able to keep offering its own residents cheap energy.

Since the war in Ukraine began, Texas has been exporting more natural gas than ever before, sending much of it to Europe as many countries try to wean themselves off Russian gas. Congress lifted a longtime ban on exporting U.S. oil and gas in 2015, which opened world markets to Texas oil and gas producers.

“People are lining up around the world to get our product,” said Todd Staples, president of the Texas Oil and Gas Association.

But demand for natural gas has also been growing at home as more people and businesses continue to flock to Texas. A hotter-than-normal spring and early summer also have driven demand for power to record-high levels. Most Texas power plants run on natural gas.

“We’ve seen Texas gas go over to Europe, which has then created a supply issue locally in the state of Texas,” said Cory Kuchinsky, chief financial officer and treasurer for CPS Energy, San Antonio’s municipal utility that provides energy to more than 1 million customers. “Our customers feel the real-time impact of changing fuel costs.”

The hike in utility bills comes during difficult financial times for many Texans, who have also been facing high prices at grocery stores and the fuel pump due to growing inflation.

With the war in Ukraine dragging on and upending the world energy market, Texas electricity providers are cautioning customers that the high rates could linger for months or longer.

The higher prices will, however, benefit some Texans. As a major gas producer, the state typically benefits from high oil and gas prices in the form of jobs and state taxes on oil and gas production. Cities located in the state’s oil fields usually benefit even more.

“I grew up in Odessa in the middle of oil and gas, and there’s always been this inverse relationship,” said Carrie Collier-Brown, lawyer for the Alliance for Retail Markets, a trade group for Texas electric providers. “For folks out there, it’s better for their economy when gas prices are high.”

But despite the spike in demand, the oil and gas industry isn’t seeing major production growth because of a backlog of orders for vital equipment due to supply chain issues stemming from the pandemic, said Garrett Golding, energy economist with the Federal Reserve Bank of Dallas.

3 Responses to “Texas’ Summer of Energy Anxiety Continues”

  1. Mark Mev Says:

    “Since then, Texas, the leading natural gas-producing state in the U.S., has not been able to keep offering its own residents cheap energy.”
    I wish they would just say it like it is. The global prices went up for gas/oil, so the Texas producers charge the global prices to americans because they can maximize profits. Even though it contributes to inflation thru a ripple effect. But then again, it is Biden’s progressive policies (the have failed to get thru congress, so maybe it is just the mention of them) that is really causing inflation here and all over the world.

    • rhymeswithgoalie Says:

      I did not read your comment before posting mine.

      Great minds think alike…and so do ours!

  2. rhymeswithgoalie Says:

    Texans are seeing skyrocketing home electric bills this spring and summer, with many customers paying at least 50% more than they did for electric bills at this time last year.

    Somehow, I’m sure, this is all Biden’s fault.


Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: